Singapore’s Eastern Pacific Shipping, a newcomer to the VLGC segment, plans to order up to six more newbuildings.
The Idan Ofer-controlled company, which already has four VLGC newbuildings on its orderbook, is said to be holding talks with shipyards in South Korea and China for two firm vessels plus options for two pairs of additional ships.
Hyundai Heavy Industries, Jiangnan Shipyard and VLGC shipbuilding newcomer Samsung Heavy Industries are said to be on Eastern Pacific’s list.
Jiangsu-based New Times Shipbuilding, which has never constructed gas carriers, was also approached. The privately owned shipyard is known for building large bulk carriers, tankers and container vessels and has delivered LNG dual-fuel vessels.
Shipbuilding sources said Eastern Pacific is seeking dual-fuel vessels of panamax beam that can transit the old Panama Canal locks. They will also be capable of carrying both LPG and ammonia.
Shipyard officials said several shipowners from Europe and Asia are enquiring about VLGCs, adding that the interest in the ship type appears to be “genuine”.
The yards did not disclose the identities of the companies, citing contract confidentiality. Eastern Pacific chief executive Cyril Ducau declined to comment.
The interest in VLGCs is said to be driven by the strong market fundamentals. One gas player said the market outlook for the ship type looks good due to growing Asian demand for LPG. US production of LPG is also set to increase because of the war in Ukraine.
“The world is also expecting an increase in use of ammonia and these new VLGC ships can be used to transport the cargoes,” said the gas player.
“Currently, ammonia is transported by large gas carriers of about 50,000 cbm to 60,000 cbm due to size restrictions at ammonia terminals. But the new ammonia supply and demand will not be coming from the same sources; there will be new terminals and new ports.
“Thus, investing in large gas carriers is not advisable and shipping companies are finding VLGCs to be more suitable.”
According to Clarksons’ Shipping Intelligence Network, the VLGC orderbook stands at 83 ships, of which 42 will be delivered this year.
Shipbuilding players think Eastern Pacific will be asked to pay close to $100m each for the vessels if it goes ahead with the order.
The diversified shipping company made its debut in the VLGC segment in 2021 when it ordered two LPG-fuelled, 86,000-cbm newbuildings at Hyundai Samho Heavy Industries for a reported $82.25m each. The vessels, to be called Logan Explorer and Nirvana Explorer, are due to be delivered in September and December this year.
Trader Trafigura was reported to have chartered the duo for five to seven years.
Last October, Eastern Pacific gave Samsung its first VLGC order when it booked two newbuildings. The LPG dual-fuel 88,000-cbm vessels, reported to cost around $95m each, are scheduled to be delivered in the second half of 2025. Gas players said the pair is still charter-free.
