Hafnia is plotting orders for new tankers to export methanol from a US production plant it is investing in.
The Singapore product tanker owner said it and an unnamed "strategic" joint venture partner are putting a combined $10m into Northwest Innovation Works (NWIW) in Kalama, Washington state.
Hafnia said this demonstrates its ambition to pursue the development of sustainable and modern clean technologies.
NWIW will use the cash to develop a 3.6m-tonnes-per-year production and export facility.
NWIW was founded in 2011 by the Pan-Pacific Energy Corp, owned by Shanghai Bi Ke Clean Energy Technology, the private equity arm of the government-owned Chinese Academy of Sciences, and BP, which later sold out.
An MR cargo every four days
Private equity fund Stonepeak Partners, no stranger to shipping investments, came on board in 2016.
Hafnia chief executive Mikael Skov said: "The plant will convert regionally sourced natural gas to methanol, which will then be transported via ship — the equivalent of an MR cargo every four days — for use in dedicated materials pathway production in Asia."
Skov said Hafnia will also provide and operate purpose-built next-generation methanol dual-fuelled ships to transport one-third of the volume produced by the plant.
These vessels will be tied to 19-year charters "with a satisfactory guaranteed return during the period", he added.
Skov later told TradeWinds: "Depending on the ultimate size of the vessels (MR or LR2), it will probably be in the range of two to five vessels required.
"Place of building will be decided in due course. pending price and quality."
Fearnley Securities said: "Given the length of the contract we would expect project returns around the 7-10% mark. With volumes destined for Asia, we would expect this to amount to 2-4 vessels depending on vessel size (MR or LRs)."
The Kalama facility will provide an economically viable alternative to coal-based methanol production, the company said.
Versatile product
The methanol can be used to produce materials, including olefins, which go into medical devices, such as masks, gowns, gloves, and eye protection, recreational equipment, clothing, mobile phones and furniture.
NWIW will offset all of its greenhouse gas emissions from direct and indirect sources within Washington.
"This initiative is another example of our strategy to support and promote industry decarbonisation while still transporting the resources necessary to sustain the world," Skov said.
"We recognise the world is changing, and that the ways we operate and conduct business need to change with it. While there is much uncertainty as to exactly what the future will look like, we’re confident that the steps we’re taking have Hafnia, our stakeholders and the industry moving in the right direction."
TradeWinds reported last month that Hafnia’s joint venture with CSSC (Hong Kong) Shipping signed up for four dual-fuel LR2 tankers at Guangzhou Shipyard International.
Vista Shipping has ordered the 115,000-dwt newbuildings against charter contracts from Total, which issued a tender in May, seeking offers for two vessels plus options for up to two more.
The ships, which will be built to run on LNG or conventional fuels, are to be chartered for five years starting in 2022.
Last month, Hafnia achieved its best quarterly result ever, boosted by a soaring freight market for its product tankers in the first months of the year.
However, it trimmed its dividend payout in view of heightened market uncertainty amid a new flare of the Covid-19 pandemic.
Net second-quarter profit rose more than eight-fold year on year to $97.7m, from $12m in the corresponding period of 2019. First-half results climbed 340% to $175m.
