LNG Tanker Rates Trending Up: Awilco
Norway’s Awilco LNG, which owns two 2013-built LNG tankers, said February 13 it made a loss in both 2017 and 4Q, but indicated that the outlook for tanker rates was positive.
Its view contrasted with a more pessimistic outlook for 2018 earlier the same day from much larger LNG shipowner MISC, controlled by Malaysian state gas producer Petronas.
Oslo-listed Awilco LNG said that activity and rates worldwide in 1Q2018 have softened marginally, which it said reflects seasonal patterns. But it said that utilisation and rates had improved through 2017, with average charter rates for 155-165,000 m3 tankers moving above $80,000/day for the first time since 1Q2014.
As owner of the two 156,000 m3 LNG vessels WilForce and WilPride, Awilco LNG itself however reported net losses of $4.5mn in 4Q2017 and $31.8mn in full year 2017, the latter being 39% greater than its 2016 loss; pre-tax earnings in both periods were positive but were offset by net finance costs and ship depreciation.
It nonetheless insisted that mid-to long-term demand for LNG transportation “remains strong”, with 18% of the global LNG fleet built prior to 2000, and few uncommitted newbuild ships being ordered. Citing shipbrokers' data, the company said that 24 LNG vessels were delivered worldwide in 2017, against the 43 expected; and that 49 vessels are scheduled for delivery in 2018 but that only 38 are now expected.
Global LNG trade increased by 12% in volume in 2017, an increment of 31mn mt last year, and that 38mn mt/yr of new liquefaction capacity is expected to start up in 2018, and a further 50mn mt/yr spanning the three-year period to 2021, the company added.
(Photo credit: Awilco LNG)