Shell has signed fresh long-term charter deals for six LNG carrier newbuildings worth over $1bn with three shipowners, bringing its declared tally to 14 new vessels.
The energy major said its Shell Tankers (Singapore) division has signed separate agreements for two LNG ships with affiliates of Knutsen LNG. It signed up for charter deals for another two with Korea Line Corp and ICBC Financial Leasing, and the third pair of ships was chartered by institutional investors advised by JP Morgan Asset Management.
The 174,000-cbm LNG carriers will be built by Hyundai Heavy Industries and Hyundai Samho Heavy Industries, both part of the Hyundai Heavy Industries Holdings group of yards.
Shell said the ships will be integrated into its time-chartered trading fleet with delivery dates from mid-2023.
The announcement confirms TradeWinds report last week that the owners were declaring six optional vessels in addition to the eight which they signed up to in December.
Optional slots
This publication reported that a further six optional LNG newbuilding slots have been secured at the yards, giving Shell the opportunity to up its vessel total to 20.
The six latest vessels appear to be sisterships to those inked by the three owners last year when Knutsen LNG contracted four vessels with Korea Line and JP Morgan signing up to two apiece.
TradeWinds reported at the time that the ships were fixed at rates in the low $60,000-per-day range against seven-year charter deals.
Industry sources have indicated that Shell, which has been moving to shed older LNG tonnage, may have committed to other LNG carriers with JP Morgan interests which control another three LNG newbuildings at Samsung Heavy Industries.
Shell, which last month unveiled its “Decarbonising Shipping: All Hands on Deck” report, said the newbuildings will be fitted with X-DF engines, boil-off management plants, air lubrication systems and shaft generators for auxiliary power.
The design and addition of energy efficiency technologies will give these ships the best emissions performance in their class, the company said.
"These ships will deliver a 60% reduction in carbon emissions compared to 2004 steam turbine LNG carriers," said Grahaeme Henderson, head of Shell Shipping & Maritime.
"Shell’s ambition is to be a net-zero emissions energy business by 2050 or sooner and highly efficient ships like these are one of the ways that we are reducing emissions in our operations.
"As we work together to develop new zero-carbon fuels at scale, we believe that LNG can play a fundamental role in providing a cleaner supply chain right now for the goods and energy that are shipped around the world every day."
