Abu Dhabi-based Adnoc Logistics & Services’ joint venture with Wanhua Chemical Group, AW Shipping, has confirmed a huge $1.9bn order.
The deal spans up to 13 supersize ethane carriers and ammonia vessels at China’s Jiangnan Shipyard.
Adnoc L&S said AW Shipping had contracted nine 99,000-cbm very large ethane carriers priced at about $1.4bn in total with Jiangnan.
The vessels can use ethane or conventional fuels and are due for delivery dates from 2025 to 2027.
A picture from the contract signing describes the VLECs as a novation agreement.
Last year, TradeWinds reported Wanhua had ordered a series of VLECs at Jiangnan. The novation reference would imply these on-order vessels have been moved into the AW Shipping joint venture.
“The VLECs will be deployed on 20-year time charter contracts, generating revenue of $4bn (AED 14.7bn) through 180 years of contract coverage,” Adnoc L&S said.
The company, whose parent is energy giant Adnoc, did not name the charterer of the vessels. But a photo of the charter signing lists the name of the parties as Wanrong New Materials and AW Shipping.
The company, which signed its contracts at a ceremony in Beijing, also confirmed TradeWinds’ report of 15 May that AW Shipping had inked an order for two 93,000-cbm very large ammonia carriers priced at approximately $250m in total.
The vessels can be fuelled by LPG or conventional fuels and are scheduled for delivery from 2026 to 2028.
This deal includes options for an additional two VLACs at the same price.
“The new vessels will be among the world’s largest ethane and ammonia carriers and run on energy-efficient dual-fuel engines,” Adnoc L&S said.
“Currently, there are more than 25 VLECs in operation with different shipping companies around the world,” the Abu Dhabi logistics company said. “Upon receiving the nine new vessels, AW Shipping will own one of the world’s largest fleets of VLECs.”
The massive gas carrier haul comes on top of Adnoc L&S’ $2.5bn worth of orders for up to 10 LNG carrier newbuildings split between South Korean shipbuilders Hanwha Ocean and Samsung Heavy Industries, signed at the end of June.
Speaking about the new contracts with Jiangnan, AW Shipping chairman and Adnoc L&S chief executive Captain Abdulkareem Al Masabi said: “This new order by AW Shipping reinforces Adnoc L&S’ ongoing fleet expansion and will bolster our ability to transport lower-carbon energy sources and support the energy transition.
“Importantly, the vessels will generate substantial revenue streams for Adnoc L&S, underscoring our commitment to value-accretive strategic investments as we serve our customers.”
Wanhua Chemical Group president and chief executive Kou Guangwu said: “These green and low-carbon ships will support Wanhua to reduce transportation carbon emissions and accelerate the decarbonisation objectives and is a concrete commitment from Wanhua to better deal with the climate change challenges.”
Jiangnan chairman Lin Ou said: “These newly ordered VLECs and VLACs are future-oriented green vessels developed by Jiangnan.”
AW Shipping was set up in 2020 to grow Adnoc L&S’ global operations and strengthen the industrial relationship between the United Arab Emirates and China.
“This latest order aligns with Adnoc L&S’ vision to deploy more than $5bn [AED 18.4bn] in value accretive investments following the company’s ADX listing in June 2023,” the Abu Dhabi shipowner said.
