LNG

Japanese shipping company Nippon Yusen Kabushiki Kaisha (NYK Line), with almost 80 LNG carriers and a fleet of over 700 vessels covering all sectors, has given an overview of shipping difficulties such as Panama Canal congestion and trading route problems, China’s economic slowdown and lower global oil output for its tankers to handle.

Japanese shipping company Mitsui OSK Lines has presented its annual update on activities, praising the role of the LNG fleet as it cemented its position as the world’s third-largest shipping group behind Japan’s NYK Line and the giant Chinese company COSCO Shipping.

The overview from President and Chief Executive Takeshi Hashimoto was contained in the updated presentation called “Blue Action 2035”, involving an initial first phase of 1.2 trillion yen ($8 billion) in investments.

“To date, the group has worked to strengthen its LNG carrier business and offshore business to increase the ratio of stable earnings,” Hashimoto explained.

“In particular, MOL’s LNG carrier business has grown to become one of the world’s leading businesses in terms of both scale and competitiveness,” he added.

Long-term contracts

“Furthermore, the group intends to increase the asset allocation to areas within the shipping industry where long-term contracts can be obtained, such as crude oil carriers and liquefied petroleum gas carriers, as well as to businesses different from industrial cargo transport, such as domestic ferries and cruise ships, and to land-based businesses such as real estate property and warehouses,” the CEO explained.

“We aim for the best mix of businesses that can resist recession, maintain stable dividends, and enjoy large profits when market conditions are favorable, by striking a good balance between market driven businesses such as containerships, which offer high returns but also large fluctuations in earnings and stable revenue businesses such as LNG carriers and real estate,” Hashimoto declared.

“The opportunity to enjoy unexpected profits over a long period can be said to be an attractive feature of the shipping business,” said the CEO.

“On the other hand, however, considering the huge capital investment required for consistent fleet renewal to continue the business, the company cannot solely rely on this irregular economic boom,” he added.

Hashimoto stated that while the shipping business would continue to be the core of the group and a source of “competitive advantage that generates high returns during market boom” MOL would also be looking to diversify and invest in other businesses to help stabilize the earnings base. 

LNG stability

MOL said that LNG continued to be a “stable revenue business” while containerships was a “market driven business” along with the car-carrier fleet.

MOL said it was currently the third-largest global shipping company with a fleet of799 vessels, just behind Japan’s NYK Line with 800-plus vessels, though well behind Chinas COSCO Shipping with around 1,300 vessels

Hashimoto noted thatLNG shipping was rapidly increasing around the world as an environmentally friendly and clean energy source.

“Since first participating in LNG transport in 1983, we have accumulated considerable expertise in this field, and boast the world’s leading share in the ownership, management, and operation of LNG carriers,” he stated.

In what it called its “energy business fleet”, MOL currently has 367 vessels operating, including 158 tankers for oil and other products and 94 LNG carriers and more than 30 other gas carriers including floating storage and regasification units, ethane carriers and LNG bunkering vessels.

“We have also entered the business of transporting ammonia, which is attracting attention as a next-generation clean fuel that does not emit CO2 when burned,” noted Hashimoto.

Nippon Yusen Kabushiki Kaisha, the Japanese shipping company known has NYK Line, is continuing to expand its liquefied natural gas-powered fleet of vessels now numbering over 800 owned and operated ships, including 86 LNG carriers.

March 1 (LNGJ) - NYK Line, the Japanese shipping company operating more LNG-powered vessels, said the car carrier “Jasmine Leader” had entered Hiroshima Port in Japan after being completed at China Merchants shipyard at Nanjing. “After completion, the vessel received LNG fuel from the ‘Kaguya’, an LNG bunkering vessel operated by Central LNG Marine Fuel in which Mitsui Osk Lines has a stake,” said NYK. “In the future, the ‘Jasmine Leader’ will be engaged in the transportation of finished vehicles for Mazda Motor Corp,” added NYK.

Japanese insurance companies will raise premiums for liquefied natural gas carriers operating in Russian territorial waters by about 80 percent starting on January 25 after previously threatening to withdraw the cover from shipping lines.

Nippon Yusen Kabushiki Kaisha (NYK), the Japanese shipping line is teaming up with two Finnish entities, to complete concept design of an LNG-powered Capesize bulk carrier and a very large crude oil tanker in a project also aimed at easy conversion for other future fuels such ammonia.

The partners from Finland are the Monohakobi Technology Institute (MTI) and a company called Finnish Elomatic Oy.

A concept design of an ammonia fuel-ready LNG-fuelled vessel (ARLFV) includes ship specifications such as overall length and width, load capacity, voyage distance and ship speed.

The joint project participants listed the main challenges in designing and developing the ARLFVs .

Firstly, because of the lower energy density of ammonia compared with LNG, a larger fuel tank capacity is needed to maintain the same level of endurance.

Secondly, the space for cargo loading, as well as the loadable cargo weight, is reduced.

Thirdly, a bigger fuel tank and additional fuel tanks affect a ship’s stability and hull strength.

Fourthly, due to the extreme toxicity of ammonia, ventilation for the ammonia tanks must be designed according to international conventions and domestic laws.

More costs

Furthermore, it was noted that conversion from an LNG-powered vessel to an ammonia-fuelled ship requires additional work periods and costs.

The three - NYK, MTI, and Elomatic - said they had sought solutions to the challenges by research and study of the fuel-tank layout and other specifications of the ship.

“The three companies then completed a concept design that has viable, functional, and safe features,” they added.

“Compared to a conventional LNG-fuelled vessel, the ARLFV in this concept design is expected to feature a conversion-cost reduction of 12 percent for a capsize bulk carrier and 25 percent for a VLCC,” they said.

The next step in the process is for the three to work with shipyards and marine equipment manufacturers on the actual design of the ARLFV based on the concept design.

Nippon Yusen Kabushiki Kaisha, the Japanese shipping company known as NYK Line, increased fiscal first-half profits and revenues from shipping liquefied natural gas and other fuels worldwide as it also ordered five new LNG carriers to add to its fleet of 58 owned and co-owned LNG vessels.

NYK’s revenues soared by 30 percent for the six months from April to the end of September 2022 and amounted to 1.36 trillion Japanese yen ($9.31 billion) compared with 1.05 trillion yen ($7.16Bln) in the fiscal first-half of 2021.

Profits jumped by 71 percent and came to 706.06Bln ($4.81Bln) versus 411.32Bln yen ($2.80Bln) in the same six months of last year.

NYK said the profits grew even as bunkered fuel costs for its fleet of ships jumped by 76 percent year-on-year to average $839.95 per ton versus $477.42 per ton in the same six months of 2021.

The NYK LNG carriers are in the energy fleet of the company’s Bulk Shipping division.

The company’s fleet comprises 658 owned and co-owned vessels, including in the largest sector 382 bulk carriers, 113 energy tankers and associated vessels, 108 car carriers and 55 containerships.

Contracts

“In the LNG carriers unit, the results were steady based on support from the long-term contracts that generate stable earnings. Also, in the offshore business, FPSO (Floating Production, Storage and Offloading), drill ship and shuttle tankers were generally steady as expected,” said NYK.

Overall Bulk Shipping revenues came to 616.4 billion yen ($4.20Bln) in the six-month period.

In the Very Large Crude Carrier (VLCC) market, NYK said that there was a further rebounded off market lows from July. Then, after oil prices fell in mid-August following the release from the strategic petroleum reserve in the United States, shipments of oil from the Middle East and US in particular rose to destinations in Europe and Asia.

“Due in part to this, the use of VLCCs increased, causing supply-and- demand conditions to tighten and the market to rapidly recover. Thereafter, the higher shipment volumes continued into September,” explained NYK.

“In the petrochemical tanker market, due to the impact of the situation in Russia and Ukraine, the origin of shipments bound for Europe shifted from Russia to the United States, Middle East and India, resulting in longer sailing distances,” the company added.

NYK also said that a consortium it is part of had signed a long-term time-charter contract with QatarEnergy for five LNG carriers for delivery between 2025 and 2026 for Qatar's expansion of LNG production.

The partners of NYK in the newbuilds contract are Malaysian shipping company MISC Group and China LNG Shipping.

Shanghai yard

The joint-venture companies have executed shipbuilding contracts for the five vessels with 174,000 cubic metres capacity with Hudong-Zhonghua Shipbuilding of Shanghai.

“Over the past 39 years since the delivery of the LNG carrier ‘Echigo Maru’ in 1983, NYK has continued to enhance its LNG safety and expertise and worldwide LNG transport network,” said the company.

“The skills that NYK has acquired in safe and optimized navigation, the construction of LNG carriers, and high-level ship-management quality have earned high regard from QatarEnergy, leading to the successful conclusion of this contract,” declared the Chiyoda City-based shipping line.

“NYK and QatarEnergy have had a long-term relationship with several existing projects and the relationship will be further extended through this contract,” it added.

NYK said these five vessels will be equipped with the latest propulsion in the X-DF 2.1 iCER engines designed by Winterthur Gas & Diesel (WinGD), headquartered in Switzerland.

The X-DF low-speed, dual-fuel engines use gas admitted at low pressure and will reduce emissions and increase fuel efficiency.

The company added that the five LNG newbuilds will be around 299 metres in length with a moulded breadth of 46.40M and with speed capability of 19.5 knots.

Nippon Yusen Kabushiki Kaisha, the Japanese shipping company known as NYK Line which has a US LNG investment and a fleet of 660 vessels from tankers to containerships and car carriers, has signed six long-term charters for LNG carriers with China National Offshore Oil Corp.

Mitsubishi Shipbuilding Co. has signed a contract to construct the first liquefied natural gas bunkering vessel to serve a growing base of LNG maritime fuel customers in Western Japan.

Mitsubishi Shipbuilding, a subsidiary of Mitsubishi Heavy Industries, signed the newbuild contract with Keys Bunkering West Japan Co. comprising a group of leading shipping and utility companies.

The new Japanese bunkering vessel with 3,500 cubic metres of LNG capacity will be built at MHI’s Shimonoseki Shipyard in Yamaguchi Prefecture with completion and handover scheduled for March 2024.

“The use of LNG propulsion for ships is attracting attention as a solution for compliance with regulations aimed at reducing greenhouse gas emissions,” said Mitsubishi Shipbuilding.

“The planned LNG bunkering vessel will have an electric main engine, and be equipped with a dual-fuel engine capable of using both LNG and heavy oil as fuel,” added the company.

Investors

Keys Bunkering West Japan is a joint venture company established in February 2022 to supply LNG fuel for ships in the Kyushu and Setouchi regions of the country.

The parties in the venture include Kyushu Electric Power Co, Shipping company Nippon Yusen Kabushiki Kaisha (NYK Line), a unit of trading house Itochu and Saibu Gas Co., a gas utility based in Fukuoka in Northern Kyushu.

“Mitsubishi Shipbuilding, as part of MHI Group’s strategic initiatives for the energy transition, will make use of the gas-handling technologies and experience it has accumulated from building LNG carriers,” added the statement from the Yokohama-based company.

“Through this business project involving low environmental-impact LNG fuel, Mitsubishi Shipbuilding, as a maritime system integrator, aims to further the decarbonization of the marine industry,” it stated.

The Mitsubishi newbuild when operating in gas mode will provide “exceptional environmental performance” with considerably reduced emissions such as carbon dioxide, nitrogen oxide an sulfur oxide.

The company said the bunkering ship of 4,850 gross tonnage will be 82.4 metres in length with a beam of 18.2 metres and a 4.8 metres draft.

March 28 (LNGJ) - Nippon Yūsen Kabushiki Kaisha (NYK), the Japanese shipping line, said it had taken delivery of the LNG-powered pure car and truck carrier (PCTC), the “Plumeria Leader”. The vessel was built at the Shin Kurushima Dockyard in Hiroshima.

   “This is NYK's second LNG-fuelled car carrier following the ‘Sakura Leader’ being delivered,” said NYK. “This ship will be one of the world’s largest PCTCs, capable of transporting approximately 7,000 units (standard vehicle equivalent) per voyage, beginning with vehicles produced by the Toyota Motor Corp.,” added NYK.