Very Large Gas Carrier (VLGC) owner and operator Avance Gas has exercised an option to purchase two mid-sized LPG/ammonia carriers (MGCs) from China’s CIMC in Shanghai.
The newbuilds will be equipped with dual fuel engines, have a cargo capacity of 40,000m³ and follow Avance’s order of two other MGCs in June of this year, which included the option for these ships.
Avance Gas CEO Øystein Kalleklev said: “Given the high expected growth of the ammonia trade, the four new MGCs are a very attractive addition to our fleet, where we already have two VLGCs on water, which are ammonia ready in terms of running it as fuel, while the two VLGCs for delivery next year can both carry and burn ammonia.”
The new ships will be capable of running on both LPG and compliant fuel oil and will be equipped with shaft generators to improve operation and maintenance costs as well as their environmental impact.
They are expected to be delivered in the second and fourth quarters of 2026 and will cost $61.5m each, the same as the previous two ships contracted by Avance from Nantong CIMC Sinopacific Offshore & Engineering Co.
Kalleklev described the ships as “highly versatile” and “future-proof in terms of emissions” thanks to the dual fuel engines and shaft generators.
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Kalleklev explained recent sales allowed for the purchase.
He said: “Given the substantial cash balance in Avance Gas of $220m at the end of the first quarter, the recent sale of Iris Glory at $60m and the strong freight market, we have the capacity to fully finance these ships without adversely impacting our ability to continue to pay dividends.”
Avance Gas claims itself as one of the world’s leading owners and operators of VLGCs thanks to its fleet of 20 LPG ships, including the four MGCs to be delivered by CIMC.
The company is also waiting on the delivery of two dual-fuel VLGCs ordered from Daewoo Shipbuilding and Marine Engineering in South Korea in January 2021.