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    Russia’s Sovcomflot Reiterates LNG Focus

Summary

The shipping company says gas and offshore are central to its strategy.

by: Tim Gosling

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Russia’s Sovcomflot Reiterates LNG Focus

Russian shipping giant Sovcomflot reiterated that its growing gas business remains central to its strategy as it reported strong first quarter results May 15. 

Net profit rose to $70mn in January-March from a $16mn loss the previous year. Revenue rose by 18.9% to $411mn.

The turnaround in net income was largely driven by a partial recovery in the conventional tanker segment, Sovcomflot said. However, the company stressed that its LNG business is now the key segment. Russian LNG exports are growing rapidly, driven by the Yamal LNG project delivered by Novatek last year. The independent has recently raised it ambitions to expand LNG capacity.

“Despite cautious optimism about conventional tankers, it is our industrial fleet working in the offshore and gas sectors … that remains central to group strategy going forward,” said CEO Sergey Frank in a statement.

Sovcomflot is also moving its fleet over to using LNG as fuel. The first quarter saw delivery of the Korolev Prospect and Vernadsky Prospect - the fourth and fifth vessels in a “pioneering” ‘Green Funnel’ series of six LNG-fuelled 114,000 DWT Aframax tankers.

The period also marked the 10th anniversary of the start of LNG shipments from the Gazprom-led Sakhalin-2 project. Sovcomflot has delivered 43.5mn m3 of LNG to Asian customers during that time, the company noted.