MOL Energia, a subsidiary of Japanese shipping major Mitsui O.S.K. Lines (MOL), has signed a long-term charter contract for three new very large ethane carriers (VLECs) with SCG Chemicals (SCGC), Thailand’s largest petrochemical company.
As informed, MOL ordered the 100,000 cbm VLECs from South Korean shipbuilder Samsung Heavy Industries. The vessels, which will have a length of 230 meters and a breadth of 36.6 meters, are scheduled for delivery in 2027.
The newbuilds will be equipped with dual-fuel ethane propulsion engines which are expected to reduce greenhouse gas, sulfur oxide, and nitrogen oxide emissions compared to conventional heavy fuel oil vessels.
“With this contract, the number of VLECs managed and operated by our group will increase to 12 vessels out of approximately 90 VLECs which have been delivered or in order,” MOL said.
SCGC has decided to import ethane to enhance its competitiveness through lower feedstock cost and flexibility for Long Son Petrochemicals (LSP), which is one of the largest petrochemical plants of SCGC, while also lowering carbon emissions.
In a separate statement, SCGC revealed it signed a long-term agreement with an affiliate of US ethane supplier Enterprise Product Partners to procure 1 million of ethane per year for fifteen years.
At the same time, SCGC inked the aforementioned long-time charter agreement with MOL for the vessel trio. As per the agreement, MOL will provide 15 years of logistics services, transporting ethane from the United States to Vietnam .
The remaining two charter agreements for ethane carriers are currently in progress, SCGC added.
MOL entered the VLEC business in 2014 and has steadily built up a ‘solid’ track record in liquefied ethane transport. In November 2016, it took delivery of Ethane Crystal , believed to be the ‘world’s first’ VLEC.
“To meet the expected increase in demand for ethane transportation, we will continue to expand our VLEC business,” MOL concluded.