Avance Gas Delivers First of 12 VLGCs to BW LPG as Part of $1.05B Deal
Avance Gas has delivered the first very large gas carrier (VLGC) to BW LPG, marking the start of deliveries of total 12 vessels as part of $1.05 billion agreement signed earlier in 2024.
Avance Gas concluded sale and delivery of the first VLGC, the 2015-built non-scrubber ship Chinook, to BW LPG on November 1, 2024.
As part of the transaction, 1.35 million shares in BW LPG have been issued to Avance Gas corresponding to approximately 1% ownership share.
The vessel is currently on a variable time charter with an energy major expiring in mid-2025 and this time charter has also been successfully novated to BW LPG.
Under the agreement made by the companies, Avance Gas will sell off the entirety of its VLGC fleet, including four 91,000-cubic-meter (cbm) vessels built in South Korea in 2022 and 2023 and eight 83,000-cbm vessels built in China in 2015, growing BW LPG's owned and operated VLGC fleet from from 41 to 53.
Once the transaction is finalized and all shares has been received, Avance Gas will be the second largest shareholder in BW LPG with approximately 12.8% ownership share.
The 11 remaining vessels are scheduled for delivery to BW LPG before the end of 2024.
According to Avance Gas, eight vessels are expected to be delivered to BW LPG in November while the remaining three VLGCs are expected to be delivered in December.
Two of the ships are subject to closing procedures in connection with novation of lease while customary closing procedures under the memorandum of agreements applies to all ships.
"We are pleased to start executing deliveries of the VLGC fleet to BW LPG with the first delivery of Chinook successfully executed according to plan. During the next few weeks, we will deliver the remaining 11 VLGCs to BW LPG.
“While the winter market for VLGCs has so far been on the soft side, we are glad to see that BW LPG has been able to capture more of the value chain economics though its integrated operations. Hence, we are looking forward to becoming the second largest shareholder of BW LPG with a 12.8% shareholding before year-end,” said Øystein Kalleklev, CEO of Avance Gas.