LNG

The United Kingdom is expected to receive about half a dozen cargoes of liquefied natural gas in the coming week, including three shipments from the US at the UK port of Milford Haven.

Burckhardt Compression, the Swiss LNG-equipment maker, is providing a comprehensive overhaul service for fleet owner Teekay LNG as part of a long-term service agreement between the two companies.

Teekay LNG has interests in 47 LNG carriers, 23 mid-size liquefied petroleum gas carriers and seven multi-gas carriers.

Part of Teekay’s LNG fleet is equipped with dual-fuel propulsion systems that use boil-off gas (BOG) for fuel to deliver cargoes around the world.

Each of these vessels is equipped with a Burckhardt-supplied Laby®-GI BOG compressor that supplies fuel to the main and auxiliary engines as well as the reliquefaction system and the gas combustion unit.

“After five years in operation, the compressor on the ‘Creole Spirit’ was due for a scheduled maintenance inspection during dry-dock in Singapore,” explained Burckhardt.

“Dry-dock maintenance projects are planned years in advance. With hundreds of specialist technicians and engineers working for dozens of suppliers, precision coordination by all those involved is essential,” added the company, based in Winterthur, northern Switzerland.

“The resources involved and the scale of these projects mean that everyone has to deliver their part perfectly for the on-time completion of the whole scheme,” said Burckhardt.

Burckhardt said its team planned and coordinated the numerous groups of contractors working on the compressor skid in the confines of the compressor machinery room to ensure optimum working safety and efficiency.

As the only BOG compressor on board, it is a crucial piece of equipment and the maintenance project was essential for continued availability.

“Thanks to more than a year’s planning, the service ran with Swiss precision and was completed within the 13 days allotted, ensuring the complete dry-dock program was also accomplished on time and without any safety incidents,” stated Burckhardt.

Preparations included tailor-made packing cases for all the parts that were shipped to the Singapore Service Center to ensure safe transportation.

Burckhardt’s on-site engineers were also able to quickly provide a solution to additional components of the control system that needed to be replaced.

With such a successful project, Teekay LNG has said that it appreciated the benefits of the partnership with Burckhardt, which adds considerable value to their operation.

“The fleet of LNG vessels equipped with the Laby®-GI BOG compressor will continue to deliver reliable service and contribute to reduced sulfur and CO2 levels,” added Burckhardt. 

Teekay LNG Partners, whose gas group units own, charter or have stakes in 77 vessels, including 47 liquefied natural gas carriers and 30 liquefied petroleum gas or multi-gas vessels, reported a first-quarter net profit following a loss in the year-ago period as voyage revenues also jumped.

First-quarter net income attributable to partners and preferred unit holders swung to a profit of $87.59 million from a loss of $32.90M in the prior-year period.

Voyage revenues increased 9 percent in the first quarter to $152.80M versus the $139.88M in the in the same three months of 2020.

“Results were positively impacted by operational claims under the Partnership’s charter contracts, lower repairs and maintenance expenses and lower net interest expense during the first quarter of 2021,” said the company.

“These increases were partially offset by redeployment of certain LNG carriers at lower rates and unscheduled off-hire for repairs,” added Teekay.

Teekay said it secured three LNG charters during March and April 2021, increasing the Partnership's LNG fleet to 98 percent fixed for the remainder of 2021, and 89 percent fixed for 2022.

In its chartering activities, the Partnership in April 2021 secured a fixed-rate charter contract for the “Oak Spirit” LNG carrier, which is expected to commence in August or September 2021, for a period of one-year.

In March 2021, a one-year, spot market-linked charter contract, with a one-year, fixed-rate option was arranged for the “Creole Spirit” LNG vessel.

Both of the vessels are modern, next generation, large LNG carriers with two-stroke engines with M-Type Electronically Controlled Gas Injection (MEGI).

As regards the dual-fuel, diesel-electric powered carrier, “Arwa Spirit”, which is 52 percent-owned by Teekay, the company said the charterer had exercised its one-year option to extend the contract to May 2022 at a fixed-rate.

“The strength of our fixed-rate LNG contract portfolio was evident again this quarter as Teekay LNG continued to generate strong earnings and cash flows even as the broader spot LNG shipping market declined from the high levels experienced during the recent winter period,” said Mark Kremin, President and Chief Executive of Teekay Gas Group Ltd.

“This decline was short-lived, however, as LNG demand rebounded counter-seasonally in late-March and into the second quarter of 2021,” added Kremin.

“We were able to take advantage of this strength by chartering out three LNG vessels, including one on a 12-month spot market-linked contract that allows us to achieve full utilization of the vessel while also retaining upside to strong markets,” stated the CEO.