LNG

GasLog Ltd, the operator of a fleet of 27 vessels along with affiliate GasLog Partners, posted a more than 78 percent surge in annual profits as global energy shipping activities intensified and charter options were extended.

Daewoo Shipbuilding & Marine Engineering (DSME) has awarded TMC Compressors (TMC) a contract to deliver marine compressed air systems to four GasLOG LNGCs currently under construction.

South Korean shipyard Samsung Heavy Industries said it was awarded a contract worth 3.9 trillion South Korean won ($3 billion) to build 14 liquefied natural gas carriers, apparently with 12 of the ships being for Qatar’s expansion project.

SHI declined to say in a regulatory filing whether the bulk of the new orders were related to a potential mega-deal from QatarEnergy after South Korean shipbuilders were asked by the Qataris in 2020 to reserve a major portion of their LNG ship construction capacity.

The shipbuilder received a separate order for two vessels and worth around $430M from an unnamed client in Africa to deliver the two ships by the end of December 2024.

The latest orders brought SHI's total for 2022 to $6.3Bln for 33 ships, including 24 LNG carriers.

With these orders, SHI said it had achieved 72 percent of its annual order target estimated at $8.8Bln for 2022.

SHI’s 12 newbuild carriers, destined to deliver Qatari volumes and which would be Bahamian-flagged, would each have capacity of 174,000 cubic metres.

SHI said this latest order marked the single largest shipbuilding contract and LNG carriers order that a Korean shipyard had been awarded.

In March 2021 the shipyard had obtained a then record order worth $2.48Bln to build 20 containerships with capacities of 15,000 twenty-foot units.

DSME order

Daewoo Shipbuilding and Marine Engineering disclosed on June 8, 2022, that it had received a $850M order for four newbuilds from Qatar.

The LNG carrier orders are increasing to keep pace with LNG and demand liquefaction plant expansion by nations such as Qatar and the US.

DSME, the world's No. 4 shipbuilder by order backlog, said it would build the Qatar project vessels with 174,000 cubic metres of capacity at the Okpo shipyard on the south coast and deliver them by the first half of 2025.

The DSME order was the first result of a $19 billion contract that DSME, SHI and Hyundai Heavy Industries, signed with Qatar to construct scores of LNG vessels through 2027.

The contract is in line with Qatar's plan to boost its LNG production capacity to 126 million tonnes per annum by 2027 in two expansions from the current 77 MTPA.

GasLog Ltd, the Greek LNG shipping company, has announced executive changes at the top with the decision of Chief Executive Paul Wogan to retire from his position on March 9, 2022.

“He will remain, in an advisory role until June 30, 2022 to ensure a smooth transition,” said GasLog.

The GasLog board named Paolo Enoizi, currently Chief Operating Officer of GasLog Ltd and CEO of US affiliate GasLog Partners LP. As the new CEO of GasLog Ltd, effective March 10, 2022.

GasLog is currently expanding its fleet and has ordered four newbuild 174,000 cubic metres capacity vessels for delivery in 2024 and 2025.

GasLog Ltd ordered the vessels from South Korea shipyard Daewoo Shipbuilding and Marine Engineering.

The four newbuilds will have latest generation M-type Electronically Controlled, Gas Injection (MEGI) propulsion system.

GasLog completed a merger in June 2021 with BlackRock’s Global Energy and Power Infrastructure division and de-listed its common shares from the New York Stock Exchange.

Structure

GasLog’s ownership structure has three main shareholders in both companies, parent GasLog Ltd and subsidiary GasLog Partners LP.

They are the Greek Livanos family with 55 percent, the Monaco-based Onassis Foundation with 12 percent and BlackRock’s Global Energy and Power infrastructure fund (GEPIF), holder of 45 percent of the equity.

GasLog Ltd, whose Chairman remains Peter G. Livanos, has an LNG fleet comprising 20 vessels, 12 dual-fuel, seven tri-fuel, diesel electric (TFDE) and one steam-turbine carrier.

Subsidiary GasLog Partners LP owns 15 LNG carriers, including 10 tri-fuel-diesel-electric (TFDE) ships and five steam-turbine vessels.

The GasLog business has undergone a substantial overhaul in recent years to improve efficiency and to reduce overheads.

This followed its decision in November 2019 to move its headquarters from Monaco to the Greek port of Piraeus, home of its operational platform.

GasLog, the Greek LNG shipping company, is expanding its fleet by ordering four newbuild 174,000 cubic metres-capacity for delivery in 2024 and 2025.

GasLog Ltd is ordering the vessels from South Korea shipyard Daewoo Shipbuilding and Marine Engineering.

The four newbuilds will have latest generation M-type Electronically Controlled, Gas Injection (MEGI) propulsion system.

GasLog completed a merger in June 2021 with BlackRock’s Global Energy and Power Infrastructure division and de-listed its common shares from the New York Stock Exchange.

The GasLog’s ownership structure has three main shareholders in both companies, parent GasLog Ltd and subsidiary GasLog Partners LP.

They are the Greek Livanos family with 55 percent, the Monaco-based Onassis Foundation with 12 percent and BlackRock’s Global Energy and Power infrastructure fund (GEPIF), holder of 45 percent of the equity.

GasLog Ltd, whose Chairman remains Peter G. Livanos, has an LNG fleet comprising 20 vessels, 12 dual-fuel, seven tri-fuel, diesel electric (TFDE) and one steam-turbine carrier.

GasLog Ltd subsidiary, GasLog Partners LP and whose Chief Executive since August 2021 has been Paolo Enoizi, owns 15 LNG carriers, including 10 tri-fuel-diesel-electric (TFDE) ships and five steam-turbine vessels.

GasLog Partners in November 2021 reported a third-quarter increase in revenues and profits as global demand gathered pace.

The partnership said income jumped 11 percent to $80.53M from $72.8M in the same quarter to the end of September in 2020.

At the end of October GasLog Partners said it completed the sale and lease-back of the “GasLog Shanghai”, with 155,000 cubic metres capacity, to China Development Bank Leasing.

GasLog noted that headline spot rates in the third quarter benefited from LNG demand growth from Asia as well as longer than average wait times at the Panama Canal.

Teekay LNG Partners reported a jump in net income in the third quarter as the shipping company prepared for a December vote on a deal worth $6.2 billion to become the latest LNG fleet to be taken over by, or merged with, US equity fund interests.

GasLog Ltd, which controls an LNG carrier fleet of 35 vessels, has made its first major foray into the debt securities market to lower interest on financing since the merger in mid-2021 with a unit of giant US investment US fund BlackRock.

GasLog Ltd entered into a Note Purchase Agreement with the US investment funds, the Carlyle Group and EIG Global Energy Partners, for a $325 million credit facility.

The Notes carry an interest rate of 7.75 percent and are due in 2029.

Carlyle’s global credit platform made the investment with capital primarily from its Infrastructure Credit Fund.

EIG extended its funding through various funds and accounts in the investment group’s direct lending division.

“GasLog anticipates drawing down the Facility in March 2022. The proceeds of the facility will be used to refinance the company’s 8.875 percent Senior Notes due in March 2022,” said GasLog.

“Any remaining proceeds may be used to pay transaction costs and expenses incurred in connection with the private placement and/or general corporate purposes,” added the company, whose corporate headquarters are in Hamilton, Bermuda and operational base is in the Greek port of Piraeus.

GasLog completed a merger in June 2021 with BlackRock’s Global Energy and Power Infrastructure division and de-listed its common shares from the New York Stock Exchange.

The GasLog’s ownership structure has three main shareholders in parent GasLog Ltd and subsidiary GasLog Partners LP.

The Greek Livanos family owns 55 percent, the Monaco-based Onassis Foundation holds 12 percent and BlackRock Global Energy and Power infrastructure fund (GEPIF) owns 45 percent.

The GasLog Ltd, whose Chairman remains Peter G. Livanos, has an LNG fleet comprising 20 vessels, 12 dual-fuel, seven tri-fuel, diesel electric (TFDE) and one steam-turbine carrier.

GasLog Ltd subsidiary, GasLog Partners LP and whose Chief Executive since August 2021 has been Paolo Enoizi, owns 15 LNG carriers, including 10 TFDE ships and five steam-turbine vessels.

The contracted revenue backlog at the end of June 2021 for the Partnership’s fleet was more than $660M and the average age of the vessels was nine years.

Wilhelmsen Ships Service of Norway, the largest ports agency network in the world, expects crew changes for LNG carriers and other vessels to proceed smoothly if required in the global shipping hub of Singapore under new Covid-19 guidelines.

Despite the Covid-19 pandemic, any crew changes can now take place in Singapore under procedures established by the Maritime and Port Authority of Singapore (MPA) and the Singapore Government, along with Wilhelmsen and other agencies.

“The new guidelines provide both predictability and a solid foundation for safe crew changes in substantially larger numbers than seen in the last few months,” said Wilhelmsen.

“In that regard, the new clear, consistent guidelines could become the blueprint for port authorities elsewhere when looking at reopening for crew changes,” said the company.

Singapore is the busiest hub for all vessels, including LNG carriers and liquefied petroleum gas carriers.

According to the MPA’s own figures 206 LNG and LPG carriers arrived in the vicinity of the port of Singapore in March 2020 and 180 LNG and LPG ships were logged in April 2020.

In the energy sector, the biggest proportion in Singapore waters were oil tankers, with 1,588 passages counted in April 2020.

The new crew change protocols are published in the Covid-19 Singapore Crew Change Guidebook and were developed in accordance with International Chamber of Shipping (ICS) Frameworks for crew changes and the MPA’s Port Marine Circular (PMC) 26 of 2020.

A guidebook has been issued by the MPA, Singapore Shipping Association (SSA) and Singapore Maritime Officers’ Union (SMOU), all in cooperation with the International Maritime Employers’ Council Ltd (IMEC) and the World Shipping Council (WSC).

Wilhelmsen said the first seafarers to benefit from the use of a chartered flight to comply with the new crew change protocol, developed by the Singapore Crew Change Working Group (SGCCWG), finally disembarked the bulk carrier “Genco Liberty” at the Port of Singapore on June 6.

The signing off crew had completed their contracts onboard.

“As an integral part of the Singapore Crew Change Working Group, (SGCCWG) we are very happy to now be coordinating the first full crew change, performed in line with the new crew change protocol we worked so hard to put together as part of the SGCCWG,” said Neal De Roche, Executive Vice President, of Wilhelmsen Ships Agency.

“It is encouraging to see how regulators, industry bodies, customers and indeed competitors now coming together to address such a critical matter, the welfare of seafarers,” added De Roche.

“As port agents, we are committed to supporting the industry in any way we can to get our seafarers home, and new crews redeployed safely and efficiently,” he stated.

The 19-man Indian crew of the “Genco Liberty” will now return home via a chartered flight from Singapore to Colombo in Sri Lanka and then on to India.

Their colleagues made up of 14 Sri Lankans and four Indian seafarers who arrived at Singapore from Sri Lanka early on June 6, also via the same chartered flight, signed on the same day.

“At Synergy Group we have desperately been trying to conduct crew changes since the outbreak of Covid-19,” said Captain Rajesh Unni, founder and Chief Executive of Synergy ship management company.

“In early March, we proposed the idea of a safe corridor for seafarers to facilitate crew changes, founded an alliance of leading maritime companies in April to push for collective crew changes and most recently have been one of the participants in the Singapore Crew Change Working Group,” he added.

“By enabling a full complement of Sri Lanka and Indian seafarers to join and disembark this GENCO Shipping & Trading bulk carrier, through this well planned and controlled changeover, they have shown the world that crew changeovers for seafarers of other nationalities are possible even during a pandemic,” stated Capt. Unni.

In the current environment, where the impact and restrictions relating to the pandemic remain fluid in many places, the expectation is that the coordination of crew change will continue to be a challenge.

Despite the COVID-19 pandemic, crew change can take place in Singapore under procedures established by the MPA.

For example, on-signers of the “Genco Liberty” were asked to remain in home quarantine for 14 days and tested negative for Covid-19 before their departure flight.

They were met at the airport by an agent with private transport that complied with safe distancing measures. Face masks and hand sanitisation were also provided for all arriving crew.

For the crew signing-off, an approved medical doctor certified that all crew members were fit-to-travel prior to sign-off. There was no sharing of passenger launch boats for crew and service engineers-technicians.

The crew were conveyed in private transport that complied with safe distancing measures, and fresh face masks and hand sanitisation were provided for all crew before boarding the vehicles.

The designated agent also reminded crew members that the donning of face masks is compulsory in Singapore.

“Singapore continues to facilitate crew change under established procedures, in view of the ongoing pandemic,” said Ms Quah Ley Hoon, Chief Executive of the MPA.

“These procedures elaborated in the Singapore Crew Change Guidebook are the efforts of many stakeholders including many Singapore government agencies, the Singapore Shipping Association leading an industry taskforce, and the Singapore Maritime Officers Union,” she explained.

“We are glad that together with Wilhelmsen and the Synergy Group, and by using a chartered flight, we have been able to help 37 crew members sign on and sign off,” said the MPA CEO.

“Such chartered flights provide an effective means of crew change under the established procedures,” she stated.

GasLog Ltd., the LNG carrier fleet owner with 19 vessels and with another 15 ships held by its US affiliate GasLog Partners, reported annual and quarterly losses as it started cost-cutting measures by moving its headquarters to the Greek port of Piraeus from Monaco and wrote-down some asset values.

GasLog posted a fourth-quarter loss of $119.9 million versus a profit of $30.3M in the same quarter of 2018.

For the year, GasLog’s losses came to $114.6M compared with a profit of $126.4M in 2018.

Annual revenues rose to $668.8M from $618.3M in the previous year, while fourth-quarter revenues slipped to $182.2M from $188.6M in the prior-year quarter.

“GasLog implemented a plan to relocate GasLog’s senior management and more of its employees to the Piraeus, Greece office, to enhance execution and efficiency and to reduce overheads,” said the company.

At the same time, the carrier operator as of December 31, 2019, recognized an impairment loss of $162.1M on its six steam-turbine propulsion vessels built in 2006 and 2007, including five US GasLog Partners LP vessels and one GasLog directly-owned vessel, due to negative market conditions.

Paul Wogan, Chief Executive, said he was pleased with the performance of the company in 2019.

“It represented another year of excellent execution for GasLog. We took delivery of two newbuild LNG carriers and signed long-term charters with the principal LNG shipping entity of JERA Co. (Japan) and a subsidiary of Endesa SA (Spain), both new customers for GasLog,” said Wogan.

“We also chartered two on-the-water vessels to Gunvor Group Ltd. and secured up to 10 years employment for one of our vessels as a floating storage unit,” added the CEO.

Wogan noted that the company also successfully completed a new debt facility for its newbuild deliveries in 2020 and 2021.

GasLog signed an export credit agency-backed debt financing facility in December 2019 for $1.05 billion with 12 international banks.

The newbuild facility covers the balance due to the shipyard on delivery and consequently the final instalments of the seven newbuild are fully funded.

Five of these seven ships are scheduled to deliver from the yards into firm multi-year charters in 2020 and the remaining two into firm multi-year charters in 2021. 

The company said one of its charters was for 10 years for one TFDE ship to act as a Floating Storage Unit for a power project being developed in Panama.

GasLog said that while spot rates for LNG carriers had improved in 2018 and 2019 compared to prior years, the term charter market for on-the-water vessels has not developed as anticipated, resulting in reduced expectations for future vessel utilization and earnings.

The company said this was particularly the case for the five steam vessels owned by GasLog Partners and one owned by GasLog after the expiry of their current term charters.

“As we continue to execute on our efficiency improvements and cost reductions, we will continue to look for further opportunities to enhance shareholder returns, on top of the special dividends paid in 2018 and 2019,” said Wogan.

GasLog said that in the LNG shipping spot market, tri-fuel diesel electric vessel headline rates, as reported by brokers averaged $70,000 per day in 2019, a 23 percent decrease on 2018 levels. 

“Low gas prices during much of 2019 limited the arbitrage opportunities for transporting LNG between the Atlantic and Pacific basins,” said the company.

“However, the market balance remains tight, as evidenced by the quick run up in TFDE rates in the fourth quarter of 2019 when they reached a peak of $140,000 per day in November, following a marked decrease in spot ship availability,” added GasLog.

“While headline spot rates in the first quarter of 2020 to date have fallen from their peaks in the fourth quarter of 2019, current headline rates are in line with or above the comparable dates of recent years,” it stated.

GasLog said that brokers currently assess headline spot rates for TFDE and Steam LNG carriers at $65,000 per day and $43,500 per day respectively. 

GasLog Ltd., the Monaco-based LNG carrier fleet owner with 19 vessels and with another 15 ships held by its US affiliate GasLog Partners, said it signed an export credit agency-backed debt financing facility of $1.05 billion with 12 international banks for its current newbuilding programme.