Singapore player confirms deal for VLGC at Kawasaki Heavy

December 15, 2011 23:01 GMT
Irene Ang and Trond Lillestolen

Singapore player confirms deal for VLGC at Kawasaki Heavy

Singapore-based Kumiai Navigation confirms it has ordered a very large gas carrier (VLGC) at Japan’s Kawasaki Heavy Industries.

A company official says the 82,000-cbm ship is slated for delivery at the end of 2013. He did not disclose the price but shipbuilding players in Japan say it will cost in excess of $77m but less than $80m.

Kawasaki is quoting a market price of $85m for a VLGC today but Kumiai is a special customer, having ordered all its LPG ships at the yard, so would be expected to secure an attractive deal.

Kumiai did not say if the newbuilding is part of the company’s fleet expansion or a replacement for an older ship but hints that it plans to sell one of its VLGCs.

LPG sources are certain the order is backed by a long-term charter to a Japanese company. Kumiai has previously fixed its ships to Showa Shell, Cosmo, Zen-Noh and Astomos and some suggested this week Astomos has taken the new order.

Gas players familiar with Kumiai say the company sold the Kawasaki-built, 75,400-cbm Crystal Mermaid (built 1990) to trader and shipowner Petredec a few months ago in a deal not reported in the market.

The 75,000-cbm Pacific Harmony (built 1990) is also up for sale as it shortly comes off a period charter to Petredec. The vessel has recently been open for inspection at Cosco Zhoushan Shipyard in China.

Kumiai is a subsidiary of Tokyo-based Kumiai Senpaku. The company’s website lists it as owning four VLGCs, including the Crystal Mermaid, five capesize bulkers, two panamaxes and a pair of aframax tankers.

On the newbuilding front, it also has three 58,000-dwt supramax bulkers, one 180,000-dwt capesize and one 205,000-dwt bulker under construction at Japanese-owned yards.

The bulker newbuildings are due for delivery between 2012 and 2013 and are said to have been booked before the market collapsed in 2008.

The spot market for VLGCs has fallen, according to Oslo-based broker Fearnleys, and stands at slightly less than $1m per month — the lowest level in five months.