LNG ship owners launch vessel pool to cut costs in depressed market

Dynagas LNG Partners LP

18/08/2015 12:00

MILAN, Aug 18 (Reuters) - Three of the top liquefied natural 
gas (LNG) tanker owners have decided to market 14 vessels 
jointly on a spot charter basis, part of a new pooling 
arrangement that is aimed at cutting operating costs in a 
depressed market. 
    The pool, consisting of eight modern vessels from Norwegian 
shipper Golar LNG  GLNG.O  and three each from Gaslog  GLOG.N  
and Dynagas  DLNG.N , will commence chartering operations in 
September, a statement from Gaslog said on Tuesday. 
    A glut of newly built LNG vessels emerging from shipyards in 
Asia has been one factor driving down daily charter rates to 
around $30,000/day, compared with $130,000 two years ago. 
    "The LNG Carrier Pool allows the participating owners to 
optimise the operation of the pool vessels through improved 
scheduling ability, cost efficiencies and common marketing," it 
said. 
    The vessels will seek employment exclusively for charters of 
12-months duration or less.  
    The move reflects a growing LNG market shift towards 
short-term trading of cargoes as prices come under pressure and 
new production from Australia and the United States towards the 
end of the year is expected to add to oversupply. 
    "The real driver primarily is the fact that we are seeing 
the short-term shipping market growing substantially, in the 
year to date there have been 97 short-term vessel fixtures 
versus around 78 in 2014," Gaslog Chief Executive Paul Wogan 
told Reuters. 
    "It's becoming a much more important piece of the (LNG) 
shipping market," he said. 
    The pool is expected to cater to this need by making vessel 
scheduling more flexible for traders, including the provision of 
rare single-voyage charters known as Contracts of Affreightment 
and other contract forms new to LNG shipping, the firm said. 
    In May, Golar LNG broke the mould by allocating six LNG 
tankers to Swiss trader Trafigura on a single-voyage, or COA, 
basis, as part of a bid to keep its fleet busy and keep the 
ships refrigerated at low temperatures to make them more 
marketable.  ID:nL5N0YA4WJ  
    LNG is ordinary natural gas chilled into liquid form at 
minus 162 degrees Celsius. Tankers carrying the fuel must be 
"cold" in order to store and transport the fuel. If vessels 
become "warm" through lack of use, they have to go through a 
cooling process before accepting cargoes. 
 
 (Reporting by Oleg Vukmanovic, editing by David Evans) 
 ((Oleg.Vukmanovic@thomsonreuters.com; 00 39 348 7607154; 
Reuters Messaging: 
oleg.vukmanovic.thomsonreuters.com@reuters.net)) 
 
Keywords: LNG SHIPPING/POOL