Singapore’s Eastern Pacific Shipping is making a big push in the VLGC segment with an order for four VLGC newbuildings worth more than $400m from China’s Jiangnan Shipyard.
The Idan Ofer-controlled company is joining a growing number of owners ordering dual-fuelled large gas carriers that can carry LPG and liquefied ammonia gas, or NH3, simultaneously.
Shipbuilding sources following the LPG market said with the quartet of 93,000-cbm newbuildings booked at Jiangnan, Eastern Pacific now has a total of eight VLGCs on its orderbook.
South Korea’s Hyundai Samho Heavy Industries and Samsung Heavy Industries are building two vessels each.
TradeWinds learned that Eastern Pacific is paying Jiangnan more than $100m each for the four dual-fuelled VLGC newbuildings. They will be equipped with separate cargo tanks designed to carry LPG and liquefied ammonia gas at the same time.
China’s Jiangnan is scheduled to deliver the first vessel in mid-2026.
News of Eastern Pacific planning to order VLGCs was first reported in TradeWinds in February. Then, the company was said to be looking to order up to six vessels including optional units.
The Singapore-headquartered company was reported to have approached Hyundai Heavy Industries, SHI, Jiangnan and New Times Shipbuilding for the newbuildings.
Shipbuilding sources said Eastern Pacific picked Jiangnan as the South Korean shipbuilders could not offer the delivery slots being sought by the company and New Times decided not to pursue the project because of its limited shipbuilding capacity.
One gas player told TradeWinds that it is likely Eastern Pacific ordered the newbuildings on speculation.
He said the strong market fundamentals are driving demand for VLGCs. The market outlook for VLGCs looks good due to a growing Asian demand for LPG. US production of LPG is also set to increase because of the war in Ukraine.
“The ammonia trade will come into play from 2026 onwards,” the gas player said. “There will be new trading patterns opening up for VLGC business.”
The design of the LPG/liquified ammonia carriers gives the flexibility to respond to different trade patterns.
Eastern Pacific’s two 88,000-cbm VLGC newbuildings at SHI are also said to be able to carry LPG and ammonia simultaneously. The duo are charter-free and scheduled to be delivered by the end of 2025.
One gas broker said about two-thirds of the 70 VLGC newbuildings on order will be built to carry LPG and NH3 at the same time.
Orderbook below average
Meanwhile, Mia Groeng of Norwegian shipbroker Fearnleys said the number of VLGC newbuildings on order looks big but the “orderbook to fleet ratio is only at 20%, which is actually below the 20-year average”.
The LPG advisor said the VLGC fleet needs some renewals, partly due to an ageing profile, but mostly down to new environmental regulations.
Eastern Pacific does not currently have any VLGCs on the water. But the company is due to take delivery of two LPG dual-fuelled 86,000-cbm vessels from Hyundai Samho in September and December this year.
The duo — to be called Logan Explorer and Nirvana Explorer — have been chartered out to trader Trafigura for five to seven years.
Jiangnan is the only VLGC shipbuilding yard in China, sources said. The Shanghai-based yard entered the large LPG segment in 2012 and has since delivered 36 VLGCs.
Jiangnan recently delivered one 40,000-cbm gas carrier to Kumiai Senpaku of Japan. One shipbuilding source said the ship can carry LPG and ammonia.
The design of the dual-fuelled 40,000-cbm Mirai (built 2023) was developed by the Chinese shipyard.
The ship is able to load LPG and can transport petrochemical products such as anhydrous ammonia and vinyl chloride monomer.
Officials at Eastern Pacific and Jiangnan declined to comment when contacted by TradeWinds.
