Jiangnan Shipyard, a subsidiary of China State Shipbuilding Corporation (CSSC), and Tianjin Southwest Shipping are extending their long-standing partnership through a new shipbuilding project. On December 2, Jiangnan Shipyard and Southwest Shipping signed a cooperation agreement for two Very Large Ammonia Carriers (VLACs).
Sources revealed that Jiangnan Shipyard and Southwest Shipping have signed a formal shipbuilding contract for two new vessels, each with a capacity of 90,000 cubic meters and a cost of approximately US$114.5 million. Delivery is scheduled for 2028. The total value of the two new vessels is approximately US$229 million (approximately RMB 1.62 billion).
This order represents Southwest Shipping’s latest move into the large-scale ammonia transport sector. As a pioneer in the Very Large Gas Carrier (VLGC) market, Tianjin Southwest Shipping has progressively built a diversified fleet of gas carriers.
Over a decade ago, the first VLGCs for the Southwest Shipping fleet were constructed by Jiangnan Shipyard. Since then, the company has placed multiple orders for large gas carriers, establishing itself as a key partner for Jiangnan Shipyard.
Not only that, but Southwest Shipping formally entered this market in 2020 by ordering two 99,000 m³ Very Large Ethane Carriers (VLECs) from Jiangnan Shipyard. The two VLECs were named “GAS PEONY” (delivered on the day of naming) and “GAS VIOLET” on December 8, 2025 (scheduled for delivery in January 2026).
Currently, Southwest Shipping operates a fleet of small-to-medium-sized liquefied petroleum gas/ethylene carriers, fully refrigerated liquid ammonia carriers, VLGCs, and bitumen carriers, transporting various gaseous chemicals and liquid cargoes. As one of China’s largest LPG transport enterprises, the company was among the earliest domestic operators of ethylene carriers, VLGCs, and refrigerated ammonia carriers, serving clients that include major domestic and international energy and petrochemical giants.
The delivery of these two 90,000 m³ VLACs will further solidify Southwest Shipping’s position in the rapidly growing ammonia transport market. With the development of emerging clean fuel projects and long-distance ammonia trade, demand in this market is expected to continue growing.
Given the projected significant growth in global low-carbon ammonia trade over the coming years, several shipowners have placed bets on new VLAC construction projects in 2024. However, some analysts note that insufficient ammonia transport demand in the medium term could lead to an oversupply of vessels, which may initially pivot to the liquefied petroleum gas market.