CMA CGM set to go for gas with $1.7bn order for up to 12 newbuilds

After its supersize containerships, liner giant again leans toward dual-fuel option for 14,000-teu boxships

CMA CGM has pencilled in a potential $1.7bn order for up to 12 boxship newbuildings of about 14,000 teu, and plans to build them with dual-fuel propulsion.

Newbuilding sources tell TradeWinds the French containership owner has signed a letter of intent with South Korea's Hyundai Heavy Industries for six ships, with an option on six more.

They price the vessels in the region of $115m each, but say the LNG-fuelling capability is likely to add up to 20%, bringing the price into the high $130m range. Delivery will start from 2020.

Brokers indicate HHI scooped the contract after it lost out on CMA CGM’s earlier tender for nine 22,000-teu vessels, which was won by two Chinese shipbuilders after a close battle for the business.

Senior shipyard officials declined to comment. CMA CGM said it does not comment on market talk.

The deal comes hot on the heels of a series of 12,000-teu ships contracted by Evergreen; pending orders from Hyundai Merchant Marine; and Yang Ming Marine’s decision to forge ahead with an order for 20 boxships of 11,000 teu and 2,800 teu.

But CMA CGM is bucking the trend set by its Asian liner cousins, which are widely expected to fit their newbuildings with exhaust gas scrubber systems to meet incoming sulphur emissions restrictions; make them scrubber-ready; or skip either option.

CMA CGM returns to yards with LNG fuel on the table

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When it emerged late last year that CMA CGM had returned to the market for another round of newbuildings after placing orders for nine pioneering 22,000-teu vessels at Hudong-Zhonghua Shipbuilding (Group) and Shanghai Waigaoqiao Shipbuilding, it was unclear whether it would opt for a dual-fuel solution on its smaller vessels.

Newbuilding brokers said the economics of adding LNG bunker tanks, weighed against the loss of container space on ships of this size trading on different routes, did not stack up as well as they did for the larger containerships.

But at the time of ordering its boxship behemoths, Rodolphe Saade-led CMA CGM outlined its commitment to the use of LNG, describing it as “a disruptive but necessary innovation to fight global warming”.

CMA CGM has signed up with French energy major Total to supply 300,000 tonnes per year of LNG as bunkers for its 22,000-teu ships. Each newbuilding is being fitted with an 18,600-cbm bunker tank to enable it to undertake a round-trip from Asia to Europe without refuelling.

Total announced this month that it is chartering in an LNG bunker vessel newbuilding contracted at Hudong-Zhonghua by Japanese shipowner MOL to supply the new boxships in northern Europe.