ADNOC Logistics and Services (ADNOC L&S) has announced that AW Shipping, its joint venture with Wanhua Chemical Group, has awarded shipbuilding contracts worth approximately $1.9 billion (Dh7 billion) to Jiangnan Shipyard in China. The contracts include the construction of nine Very Large Ethane Carriers (VLECs) priced at around $1.4 billion (Dh5.1 billion) and two Very Large Ammonia Carriers (VLACs) priced at approximately $250 million (Dh900 million), with an option for an additional two VLACs at the same price.
These new vessels, among the world’s largest ethane and ammonia carriers, will feature energy-efficient dual-fuel engines. The VLECs are set to operate on 20-year time charter contracts, generating $4 billion (Dh14.7 billion) in revenue through 180 years of aggregated contract coverage.
“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,” said Captain Abdulkareem Al Masabi, Chairman of AW Shipping and CEO of ADNOC L&S. “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, over 25 VLECs are in operation globally with various shipping companies. Upon delivery of the nine new vessels, AW Shipping will own one of the world’s largest fleets of VLECs.
The VLECs, each with a carrying capacity of 99,000 cubic meters, can be powered by ethane or conventional fuels and are scheduled for delivery between 2025-2027. The VLACs, each with a carrying capacity of 93,000 cubic meters for ammonia, can be powered by liquefied petroleum gas (LPG) or conventional fuels and are expected for delivery between 2026-2028.
