GasLog Singapore, a 155,000 cbm LNG carrier owned by GasLog, image: GasLog
International owner and operator of LNG carriers, GasLog (NYSE:GLOG), said Friday that it has ordered two charter-backed 174,000 cbm tri-fuel diesel electric LNG carriers from Samsung Heavy Industries in South Korea, and at the same time announced the modification and extension of a separate long-term charter contract with BG Group for another one of its newbuilds.
GasLog says the two newbuilds announced today will cost just over $200 million each, for a combined total of US$410-$420 million fully delivered in Q1 and Q2 2016. Upon delivery the vessels will commence a firm ten-year charter with a subsidiary of BG Group and are expected to generate a combined annual EBITDA of approximately US$47–$48million over the first twelve months of operation.
As for the other contract with BG Group, GasLog says it has agreed to modify and extend the charter currently in place for its Hull Number 2017, which is chartered to a subsidiary of BG Group and scheduled for delivery in Q3 2013. Under the new agreement, the ship will be delivered into an eight year charter where the first three years remain as previously contracted, but the subsequent five years are a seasonal charter under which the ship is committed to BG Group for seven consecutive months per year and remain available for other charters for the remaining five months.
GasLog now has a twelve-ship fully owned fleet, including three ships that have already been delivered – two in 2010 plus one on January 29, 2013 – and nine ships either under construction or planned construction through Q2 2016. All three of the ships in operation, including the recently delivered GasLog Shanghai, are currently on charter. GasLog has just two of the newbuilds for which no charter has yet been signed. GasLog also has another 12 LNG carriers operating under its technical management for third parties.
Paul Wogan, CEO of GasLog commented: “These contracts reinforce our strategy of building high quality ships at competitive prices for charter to strong, creditworthy customers. The seasonal charter also demonstrates our flexibility in meeting customer needs whilst also being able to capitalize on opportunities in the LNG spot market during a period where we expect increased demand for shipping from planned liquefaction projects.”
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