The Company is leading China's LNG transportation business, and is now an important player in the global market. Strengthening cooperation with partners in the industry, we serve the global LNG industrial chain together.
We participate in LNG projects via two subsidiaries, COSCO SHIPPING LNG Investment (Shanghai) Co., Ltd., a wholly-owned subsidiary of the Company, and China LNG Shipping (Holdings) Limited (CLNG), of which the Company holds 50% equity. By June 30, 2021, we have invested in 41 LNG carriers in total, of which 38 are in operation with a shipping capacity of 6.42 million cubic meters. Three carriers are under construction with a ship capacity of 522,000 cubic meters.
LNG is the abbreviation of Liquefied Natural Gas. It is formed by liquefying natural gas under ultra-low (-163°C) conditions, and its volume is 1/625 of its gas form. The liquefaction of natural gas can greatly save storage and transportation space. The LNG industry chain is a complete chain that is capital and technology intensive. The chain runs through the entire process of the natural gas industry. The natural gas extracted from onshore or offshore oil fields is pre-processed by liquefaction companies and then liquefied. The produced LNG is transported to LNG receiving stations in accordance with the trade contract by shipping or other methods for storage and regasification, and then delivered to users via the pipeline network.
The characteristics of the LNG transportation industry: First, LNG carriers feature high-tech, high-difficulty, and high-added-value, which are expensive to build. LNG transportation has higher requirements for ship management, so the LNG shipping industry is highly concentrated. Second, affected by the LNG industry chain, most carriers in the current global LNG fleet are bound to specific LNG projects (referred to as "project ships") and sign long-term time charter party with the project parties.