The contract for nine VLECs is priced at approximately $1.4 billion while the contract for two VLACs is valued at around $250 million, with the option for another two VLACs at the same price.
According to ADNOC L&S, this is the largest order of the joint venture which was established in 2020 to support a 10-year LPG supply contract between UAE and China.
The newbuilds, slated for delivery from 2025, are expected to be among the largest ethane and ammonia carriers propelled by energy-efficient dual-fuel engines.
As disclosed, the VLECs will have a carrying capacity of 99,000 cubic meters each and can be powered by ethane or conventional fuels. They are scheduled for delivery between 2025 and 2027.
Nine VLECs will be deployed on 20-year time charter contracts, generating revenue of $4 billion through 180 years of aggregated contract coverage.
Each VLAC will have a carrying capacity of 93,000 cubic meters for ammonia and can be powered by liquefied petroleum gas (LPG) or conventional fuels. They are scheduled for delivery between 2026 and 2028.
Abdulkareem Al Masabi, Chairman of AW Shipping and CEO of ADNOC L&S, commented on the order: “This new order by AW Shipping reinforces ADNOC L&S’ ongoing fleet expansion and will bolster our ability to transport lower-carbon energy sources and support the energy transition.
“Importantly, the vessels will generate substantial revenue streams for ADNOC L&S, underscoring our commitment to value-accretive strategic investments as we serve our customers.”
Currently, there are more than 25 VLECs in operation with different shipping companies around the world. Upon receiving the nine new vessels, AW Shipping will own one of the world’s largest fleets of VLECs, ADNOC L&S said.
Kou Guangwu, President & CEO of Wanhua Chemical Group, added: “We are extremely happy to place new VLECs and VLACs shipbuilding orders to Chinese Jiangnan Shipyard together with our strategic partner ADNOC L&S through our AW Shipping joint venture, which is a firm recognition of high-end Chinese equipment manufacturing capability and creates a solid foundation to further deepen the strategic cooperation between Wanhua and ADNOC L&S.
“These green and low-carbon ships will support Wanhua to reduce transportation carbon emissions and accelerate the decarbonization objectives and is a concrete commitment from Wanhua to better deal with the climate change challenges.”
In 2023, AW Shipping also welcomed five new dual-fuel very large gas carriers (VLGCs) built at Jiangnan shipyard in Shanghai, China.
