A refinery owner turned shipowner is said to be helping Yangzijiang Shipbuilding to break into the newbuilding market for very large ethane carriers (VLECs).
Industry players said the Chinese shipyard bagged an order for three 99,000-cbm vessels from Singapore-headquartered SP Chemicals, also known as Singpu Chemicals.
Gas players say SP Chemicals has until now been operating one or two VLECs chartered from Chinese owner Pacific Gas, including the Jiangnan-built 99,000-cbm Pacific SP Minerva (built 2024).
Shipbuilding sources said Singapore-listed Yangzijiang, which made its debut in the LNG sector in 2022, has been looking to expand its product portfolio to include large LPG ships and ethane carriers.
They added that the Yangzijiang VLECs with a type-B tank cargo solution were designed by the Marine Design & Research Institute of China.
Details of the contract have yet to emerge, but brokers suggested that Yangzijiang may be able to deliver the three vessels between 2027 and 2028.
They believe it has offered a “special price” to SP Chemicals for the newbuildings, as this is the first VLEC deal for the shipbuilder.
Brokers speculated that it will be less than $160m per ship, as Jiangnan Shipyard — the only Chinese yard building the ship type — is seeking about $170m.
Officials at Yangzijiang declined to comment, citing contract confidentiality. SP Chemicals has been contacted for comment.
There was a mini-surge in VLEC orders last year; Clarksons’ Shipping Intelligence Network recorded 28 newbuildings contracted.
Companies ordering the ship type included Wanhua Chemical, Sinogas Maritime, Pacific Gas, AW Shipping, Purus Marine and Mitsui OSK Lines.
The orderbook for VLECs stands at 41 ships, of which 31 are being built by Jiangnan and the rest by Hyundai group yards.
SP Chemicals was incorporated in Singapore in 1990 and started a chemical business in Taixing, China, in 1995 with an initial capital investment of $29.5m.
The refiner imports its ethane from the US and has a gas cracker plant in Taixing with a production capacity of 650,000 tonnes per annum of ethylene.
It produces ethylene, propylene, styrene, vinyl chloride monomer, caustic soda, chlorine, hydrogen and other chemical raw materials.
The paid-up capital for SP Chemicals Taixing has increased to $521.9m and the total investment outlay was CNY 11bn ($1.52bn) as of the end of 2021. The company generated CNY 13.6bn of revenue in 2021 and employs more than 2,000 employees.
It plans to achieve a target revenue of more than CNY 35bn by 2025 from its principal business.
SP Chemicals was privatised and delisted from the Singapore Stock Exchange in 2009, following six years of being publicly traded.
