Dynagas LNG Partners — a master limited partnership with considerable exposure to business in Russia — reported stable revenue and higher profit for the second quarter as it remains untouched by Western sanctions against Moscow over the war in Ukraine.

Five of the New York-listed company’s six large LNG carriers are on long-term charters involving Russian companies or projects.

In April, the German government effectively took over three of these ships — the 149,700-cbm Clean Energy, Ob River (both built 2007) and Amur River (built 2008).

The move was part of a wider takeover by Berlin authorities of Gazprom Germania, a German subsidiary of Russia’s state-controlled energy gas giant.

Dynagas LNG Partners said late on Tuesday that it had carried out scheduled dry docks on all three ships since then, also installing ballast water treatment installation systems on them.

The Clean Energy and Amur River started dry-docking on 16 March and 25 June, respectively, while the OB River began and completed its dry dock in the third quarter.

Looking for future growth

German regulators, who placed the three vessels under their administration to “guarantee the security of European energy supply”, continue honouring their charters without fail.

Dynagas LNG Partners said all the partnership’s counterparties “are currently performing their obligations under their respective time charters, in compliance with applicable US and EU rules and regulations”.

As a result, the partnership’s voyage revenue remained broadly constant year on year in the second quarter at $33.4m.

Net income even rose during the same period at an annual pace of 22% to $11.1m, helped by accounting gains.

The favourable valuation of the company’s interest rate swaps outweighed increased dry-docking costs.

The company reiterated earlier statements that even though the full impact of US and EU sanctions against Russia remains uncertain, they “do not materially affect the business, operations or financial condition of the partnership”.

Even though Russian exports of natural gas to Europe via pipeline have been seriously curbed, LNG remains outside the scope of EU sanctions.

“We are in a period of high demand for LNG shipping, which we believe will benefit the partnership,” chief executive Tony Lauritzen said in the statement.

Lauritzen said earlier this year that the company was considering converting part of its ships to floating storage and regasification units.

“We continue our strategy of using our cash flow generation to deleverage our balance sheet and reinforce our liquidity so as to build equity value,” Lauritzen said on Tuesday.

He added that this “will enhance our ability to pursue future growth initiatives”.

Gazprom has the Clean Energy, Ob River and Amur River under charter until between 2026 and 2028.

Dynagas LNG Partners’ 55,000-cbm Yenisei River and Lena River (both built 2013) are on charters lasting for at least another 11 years at the Yamal LNG project — an LNG production terminal on the Yamal Peninsula in northern Russia.

The owner’s sixth ship — the 155,000-cbm Arctic Aurora (built 2013) — is on charter to Norwegian oil major Equinor until the first quarter of 2026.