West African producer Nigeria LNG (NLNG) has sold a 22-year-old, steam turbine-driven LNG carrier as the number of elderly vessels continues to build up in an exceptionally weak market.
Brokers said a deal had been concluded on the 137,098-cbm LNG Sokoto (built 2002), which is part of NLNG subsidiary Bonny Gas Transport (BGT)’s fleet.
Details of the price and buyer have yet to emerge.
The ship, which was briefly laid up in 2016, is said to have attracted offers at below last done, with one broker suggesting this was in the $30m range. Others said the vessel was worth something starting with a “2”.
The LNG carrier is said not to be for immediate delivery to its new owner and may lift a few more cargoes for NLNG before it is handed over.
TradeWinds has contacted NLNG about the vessel.
Industry players have pointed to several companies with fleets comprising rafts of ageing steam turbine vessels that they will need to upgrade or replace to comply with emissions and global trading requirements.
BGT, set up in 1989, is one on their watch lists. Two years ago, the company controlled a fleet of 23 LNG carriers of which it owned 13, comprising seven steam-turbine vessels and six dual-fuel diesel-electric ships.
In 2022, the three oldest ships in BGT’s fleet — the steam turbine LNG Sokoto, 137,231-cbm LNG Rivers (both built 2002) and 137,065-cbm LNG Bayelsa (built 2003) — were circulated for sale with offers requested on modern tonnage that could be chartered in.
A year later, BGT appeared to begin its fleet renewal moves, selling the LNG Rivers for about $35m to Evangelos Marinakis-controlled Capital Gas Ship Management Corp.
The 21-year-old, Moss-type steam turbine vessel was named Trader IV but later sold and is now trading as a sanctioned vessel under the name Asya Energy for Russian interests.
The purchase appeared to be part of a larger deal under which Capital fixed its two 2024-delivering, 174,000-cbm LNG newbuildings Axios II and Aktoras to BGT.
The new LNG carriers were reported fixed on bareboat deals of about seven years at $100,000 per day, equating to a time-charter equivalent rate of close to $120,000 per day.
At a shipyard naming ceremony for the Aktoras in May, NLNG managing director and chief executive Philip Mshelbila, who is also BGT executive vice president, said: “The charter of a newbuild modern tonnage to BGT, on a bareboat charter basis, represents a strategic move towards diversifying our shipping portfolio. This vessel signifies a new era of greater efficiency and sustainability for BGT’s fleet.”
Steam turbine LNG carriers are having a torrid time in a severely depressed LNG chartering market.
There was already a growing clutch of them for sale as the vessels rank as small, inefficient and unsuitable for global trading as new emissions regulations toughen.
This week, brokers were pegging spot rates for steamships at below $20,000 per day, although several admit that these benchmarks were fairly meaningless for some of the oldest vessels in the global LNG fleet.
They said that, in reality, open steamers are not being chartered and even those with low operating expenses in the $12,000 to $13,000 per day range see no point in trying to trade them.
Then there is the added issue of any upcoming special surveys with few prepared to pay out to upgrade elderly vessels due to the current market prospects.
