NYK to expand LNG fleet

Nippon Yusen K.K., the largest Japanese shipping line, plans to order 20 new LNG carriers by 2010 and use five or six tankers for spot contracts, a change in strategy that may bring higher returns.

The company will fund the purchase of 15 of the ships jointly with customers with whom it has long-term contracts while it will be the sole owner of new or existing ships for the spot market. Operating LNG tankers under spot contracts will enable the company to sell LNG to the USA in case demand for LNG among domestic utility companies falls due to a slump in demand for electricity in Japan.

NYK currently operates 33 LNG tankers, making it the fourth largest shipper of LNG worldwide. It has already ordered 28 more LNG ships and plans to have a fleet of 80 by 2010. Hyundai Heavy Industries and Mitsubishi Heavy Industries are the two main shipbuilders for the Japanese shipping company.