Demand for LNG shipping is set to remain strong through into next winter, new GasLog Partners chief executive Paolo Enoizi said in a results call.

Enoizi, who has been in the job for three months, said: "We anticipate that the growth of inter-basin trading and the likely recycling of older tonnage will more than offset scheduled deliveries over the next couple of years projecting a relatively tight shipping market through 2022 and 2023."

He said consultant Wood Mackenzie is forecasting that the Pacific basin will have an LNG shortfall of 129 million tons (mt) in 2022 which should support strong shipping demand.

Enoizi said US supply is expected to meet strong demand from Asian buyers, highlighting that total US exports rose 18 mt in third quarter 2021.

He said ton-mile demand for LNG carriers is up 16% in the year-to-date, more than twice the rate of LNG demand growth in the first nine months of 2021.

Record setting

Some 129 LNG carrier term charter deals have been logged in 2021 so far, he said, setting a new record.

Enoizi quoted Poten & Partners one-year time-charter assessment for tri-fuel diesel-electric (TFDE) vessels at almost $100,000 per day with headline spot rates for TFDE ships at $160,000 per day and those for steam turbine vessels at over $112,000 daily.

He said that while it is not unusual for spot rates to move higher ahead winter these are well ahead of where they were last year and are approaching a five-year record high.

The CEO said LNG spot rates have benefitted from strong growth in the inter-basin trading of LNG and persistent Panama Canal congestion along with port congestion and drydocking delays due to Covid-19 which have helped reduce vessel availability.

But restocking in both Europe, where gas storage levels are low, and Asia will create high demand which is positive for LNG carriers, he said.

Looking at the LNG carrier orderbook, Enoizi said the number of deliveries scheduled for 2022 is less than half those ships delivered this year, with just three unfixed vessels due for handover next year.

Paolo Enoizi is three-months into his tenure as chief executive of GasLog Partners. Photo: GasLog

Coupled with this the earliest delivery time available is the second half 2024 and the price of a newbuilding is up at around $210m.

Setting strategy

Enoizi reiterated the company's strategy of strengthening its balance sheet and reducing its break-even costs on its 15-ship fleet while detailing its debt reduction targets.

"We believe that prioritising debt reduction supports the partnerships future growth in equity value," he said

Answering an analyst's question on whether GasLog Partners will fix out its ships that potentially come open in the second quarter of 2022, Enoizi said this would be unlikely in the next few weeks.

But he added: "The enquiries keep coming, even for 2022. We are very positive about this.

"We do anticipate continued growth of demand for LNG and therefore for LNG shipping for many years to come as a compliment for renewables as the world transitions to a carbon free future," Enoizi said.

"We want to strengthen the partnership to the best shape to be an industry consolidator over time as opportunities for growth and fleet modernisation will appear."