LNG선 해운시장의 변화에 대한 하주의 전략적 대응에 관한 연구: Spot 시장의 등장 가능성을 중심으로

Abstract

Natural gas is expected to be the fastest growing component of world primary energy consumption under projected environment changes like both liberalization of natural gas markets and open-door policy to the third party access to them. To add to this, the existing gas participants both of sellers and buyers are trending to balance supply and demand by using flexibility tools which enable supply to be adapted to fluctuations in demand, and enable demand to be modified in case of insufficient supply.

In this connection, LNG business which forms a part of nature gas trade and plays an important role in it, has also been affected by such market climate changes and succeeding risk redistribution. Moreover all the parties concerned are being squeezed by intensifying deregulatory moves, etc. and can no longer afford all risks, regardless of volume or term. In times past, however, only three major elements of sizeable contract volume, long contract term and take-or-pay (TOP) were seen as crucial to LNG business characterized by bilateral contracts between specified sellers and buyers although three characteristics guarantee stability of the business, but represent rigidity concurrently.

On the whole, such a changing market trend can bring radical risk to the existing buyers as LNG shipper from the point of view that entrants will be eager to get gradually on the market which is coupled with cost decrease through the buyers' hardships. As an expected result, the market can be strenuous contributing to the expectation of strong worldwide growth for LNG.

In the meantime, taking a view of the large-scale shippers' weight to improve the quality of people's lives by supplying quantities of LNG, the shippers as buyer also face opportunity because they have affected LNG and LNG shipping markets, and because they will affect consecutively the both markets in the future.

In these days, projected environment changes in LNG business require shippers to participate in offering their strong comparative advantage of being able to put their decisions in the proper transport with emphasis on investment in maritime sector, which can be termed transportation flexibility, whereas commercial pressures to some LNG ship operators and their disability to raise substantial amounts of private capital, in the course of attractive investment opportunities to transportation, can have hindered the transport project financing itself.

With regard to the shippers' market position, economical efficiency and related policies should be considered throughout ship's lifetime from delivery to scrap in company with the operators' activities. In addition their role should be consulted on competition and technological advancement in ship arrangement which can lower transport costs, and then help to execute an effective decision-making as occasion demands.

The best solution for current market complexity can be a more commercially oriented approach to the design of a specific transport project financing that is transportation-flexibility-driven and shipper-oriented under using shippers' credit if possible.

This paper contains an analysis of the complexities of LNG business including shipping sector as well as the current state. In addition, for further study, system dynamics as a methodology is introduced to study the potential LNG shipping market in the future, whose central concept is understanding how all the objects in a system interact with one another. And VENSIM as a visual modeling tool is selected to conceptualize, document, simulate, analyze and optimize models of dynamic systems throughout the process of causal loop, stock and flow diagrams, and exploration of behavior of the model.

As a result of the VENSIM analysis for recent LNG shipping market which contains strategical trends in past years and forecasts for the future, potentiality of the spot LNG shipping market is systematically established in connection with embodiment of the spot LNG market. Moreover its appearance is predicted to take a concrete shape in about 3 years from now unless relevant situations have dramatically changed. As a necessity, shipper's strategic shifts focused on the potential spot market is needed to cope with changing LNG shipping market's environment. At the same time, the shippers are also strongly requested to prepare for the coming spot market.

This paper guides three methods, which are centered on newbuildings of ships, for the shippers to prepare for the spot LNG shipping market on the basis that maritime economics can make a direct contribution to shippers' business decision-making as follows.

First, shippers' direct participation in building necessary ships as investor. The objective of this method is to lighten a burden imposed on the operators to arrange a new ships. During the last years financing shipping by the operators' debt has been the favoured way which is attractive to the operators as a flexible device to finance a shipping company, while retaining full ownership of the business. But at present the situation is changed and security conditions, which are imposed by lenders setting out the conditions that a borrower must satisfy and the rights of the lenders in default case of repayment, comes to be the most important part of lending process. Some operators, however, do not seem to meet capital concentration and intensified global competition in financing shipping rather than sound large-scale shippers. And the operators' loan arrangement for the potential spot market preparation may be lLNGthy process to obtain credit approval from lenders, or fundamentally be impossible to promote it without shippers' backup. So shipper's direct participation in building necessary ships as investor can be valid to solve the problems.

Second, shipper's indirect participation as investor through a financial subsidiary company to gather the lenders. This is complement to the first method where relevant laws and regulations shall not permit the previous one. The subsidiary company is established to structure the loans including shippers' participation to own the necessary ships for spot business as well as contract volume. A more detailed definition of some of the terms and concepts with the second method will be determined in accordance with the respective cases.

Third, shippers' indirect participation as investor through a consortium, for instance, with ship funds under the Ship Investment Corporation Act. Nowadays most of long-term investment is carried in the way of funds by institutions such as pension funds, insurance companies and related industries. Accordingly shippers can use this method to gather long-term investment by institutions including parties concerned with sound finances, and then to prevent the risk from financing shipping by the operators' debt. The strong point of this method can be illustrated by availability of whole funds by investors in return for a share of the profit, and be formed into bonds and securities for investment.

In conclusion, for a certain reason that the advent of the spot LNG shipping market is obvious, shippers should recognize such a market trend, and prepare to take an opportunity of prior occupation for the future market through direct or indirect investment with financial institutions.