Samsung Heavy Industries wins first U.S. FLNG contract worth $2.9B

Samsung Heavy Industries said Thursday that the floating liquefied natural gas production facility (FLNG) contract it disclosed Tuesday is the first FLNG construction deal for the Delfin LNG project in Louisiana.

The Delfin FLNG will be the first of its kind ever built in the United States. The contract is valued at $2.9 billion (4.33 trillion won).

The Delfin LNG project marks the first time an FLNG has been developed through a partnership between a purely private developer and a shipbuilder acting as EPC (engineering, procurement and construction) contractor — without the involvement of a major oil company or state-owned enterprise.

The project breaks from the traditional model of building massive onshore LNG plants, instead adopting a "multiple FLNG" approach in which several identically specified units — three are planned — are deployed together. The model spreads early-stage investment risk and maximizes production flexibility in response to market shifts.

The vessel is designed as a hybrid FLNG that combines the economic advantages of a nearshore configuration with the stability required for an offshore environment. The topside plant will feature a slim, lightweight design that receives pre-processed gas supplied from shore, reducing construction costs. The unit will also be equipped with a large 120-person accommodation block and a mooring system to allow safe operation 75 kilometers off the Louisiana coast.

The vessel will incorporate a range of advanced eco-friendly technologies — including an air-cooled cooling system and a combined power generation system designed to maximize energy efficiency and minimize carbon emissions — to reduce its impact on the marine ecosystem. Samsung Heavy also plans to install a self-propulsion system that allows the unit to actively maneuver away from hurricanes.

Samsung Heavy's integrated FLNG execution capability underpins the advanced technology built into the Delfin unit. The company has secured 7 of the 11 newbuild FLNG orders placed worldwide to date, starting with Royal Dutch Shell's Prelude — the world's largest FLNG. Its global market share stands at 64 percent.

Samsung Heavy is currently in negotiations to build follow-on units in the Delfin series. "The Delfin project is significant because Samsung Heavy Industries is leading series construction while independently carrying out the entire EPC process for the first time," a company official said. "We will drive the era of FLNG mass production by applying the optimized design and solutions that Samsung Heavy proactively proposed to ensure economic viability."

Meanwhile, Samsung Heavy's cumulative order intake this year stands at 28 vessels totaling $8.3 billion, reaching 60 percent of its annual target of $13.9 billion. The company's first-quarter operating profit came to 273.1 billion won, more than doubling from the same period a year earlier.