ADNOC L&S awards contracts to build ethane and ammonia tankers

Abu Dhabi (Al Ittihad)
ADNOC Logistics & Services PLC has announced that AW Shipping, its strategic joint venture with China’s Wanhua Chemical Group, has awarded contracts totaling AED 7 billion (US$ 1.9 billion) to China’s Jiangnan Shipyard for the construction of nine ethane supertankers (VLCCs) valued at AED 5.1 billion (US$ 1.4 billion) and two ammonia supertankers (VLCCs) worth approximately AED 900 million (US$ 250 million), with an option for two additional ammonia supertankers of the same value.
The new tankers will rank among the largest ethane and ammonia tankers globally and will feature energy-efficient dual-fuel engines.
The VLCCs will be chartered for 20 years and are anticipated to generate revenues of AED 14.7 billion (US$ 4 billion) over the 180-year term of the contracts. The contracts were signed in Beijing, China, during a special event attended by His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Group CEO; Liao Zengtai, Chairman of Wanhua Chemical Group; Xiandi, Mayor of Fuzhou City; Cai Hu, Chairman of China Shipbuilding Corporation Limited; Ou Lin, Chairman of Jiangnan Shipyard; and Wen Gang, Chairman of China State Shipbuilding Corporation Limited.
“This new order from AW Shipping demonstrates ADNOC L&S’ continuous efforts to expand its fleet to enhance low-carbon energy transportation capabilities and facilitate the energy transition. These VLCCs will significantly contribute to ADNOC L&S’s revenue, highlighting its commitment to strategically valuable investments and effective customer service,” stated Captain Abdulkareem Al Masabi, CEO of ADNOC L&S and Chairman of AW Shipping.
Currently, there are over 25 VLCCs in operation with shipping companies worldwide, and with the addition of the nine new vessels by AW Shipping, the company will operate one of the largest VLCC fleets in the world.
“We are extremely pleased to receive the contract from Jiangnan Shipyard to construct the VLCCs in collaboration with our strategic partner ADNOC L&S through our joint venture AW Shipping, which showcases China’s exceptional manufacturing capabilities and lays a strong foundation for strategic cooperation between Wanhua Group and ADNOC L&S. These low-carbon vessels will assist Wanhua Group in reducing transportation emissions, accelerating its decarbonization initiatives, and represent a tangible commitment to addressing climate change challenges,” remarked Qu Guanggu, President and CEO of Wanhua Chemical Group.
AW Shipping, established in 2020 as a joint venture between ADNOC L&S and Wanhua Chemical Group, aims to support ADNOC L&S’s global operations and enhance UAE-China industrial relations. The recent tanker contracts align with ADNOC L&S’s vision to invest over AED 18.4 billion (US$ 5 billion) in valuable investments following its listing on the Abu Dhabi Securities Exchange in June 2023.
Lin Ou, Chairman of Jiangnan Shipyard, noted: “As a world-leading shipbuilder and developer of gas carriers of all types, we are pleased to strengthen our collaboration with ADNOC L&S. The new VLCCs we have ordered are low-emission, future-ready vessels, and we are committed to delivering these ships on time and with high quality to support ADNOC L&S’s growth strategy and carbon reduction objectives.”
Notably, each giant ethane tanker will have a capacity of 99 thousand cubic meters and will be equipped with engines capable of running on ethane or conventional fuel, with delivery scheduled between 2025 and 2027.
The colossal ammonia tankers will each have a capacity of 93,000 cubic meters, equipped with engines that can operate on liquefied petroleum gas or conventional fuel, and are expected to be delivered between 2026 and 2028.

<div class="post-content">
    <h1>ADNOC Logistics & Services Expands Fleet with Major LNG and Ammonia Tanker Orders</h1>

    <h2>Overview of the Announcement</h2>
    <p>In a significant development for the maritime and energy sectors, <strong>ADNOC Logistics & Services PLC</strong> has announced a strategic partnership expansion with <strong>AW Shipping</strong>, its joint venture with China’s <strong>Wanhua Chemical Group</strong>. The partnership recently awarded contracts totaling approximately <strong>AED 7 billion (US$ 1.9 billion)</strong> to <strong>Jiangnan Shipyard</strong> for the construction of groundbreaking ethane and ammonia supertankers.</p>

    <h2>Details of the Contract</h2>
    <ul>
        <li><strong>Nine ethane supertankers (VLCCs)</strong> valued at <strong>AED 5.1 billion (US$ 1.4 billion)</strong></li>
        <li><strong>Two ammonia supertankers (VLCCs)</strong> valued at around <strong>AED 900 million (US$ 250 million)</strong></li>
        <li>Options for <strong>two additional ammonia supertankers</strong> of similar value</li>
        <li>Contracts include a charter of 20 years</li>
    </ul>

    <h3>You can expect significant revenue generation</h3>
    <p>The new vessels are expected to generate revenues of approximately <strong>AED 14.7 billion (US$ 4 billion)</strong> over a contract span of <strong>180 years</strong>, underscoring the long-term strategic vision of ADNOC L&S.</p>

    <h2>Significance of VLCCs in the Market</h2>
    <p>With over 25 VLCCs currently in operation globally, this latest order positions AW Shipping to become one of the largest VLCC fleets worldwide. Each ethane tanker will have a cargo capacity of <strong>99,000 cubic meters</strong>, while the ammonia tankers will accommodate <strong>93,000 cubic meters</strong>. Both types will feature advanced energy-efficient <strong>dual-fuel engines</strong>.</p>

    <h3>Key Players and Stakeholders</h3>
    <p>The contract signing ceremony was held in Beijing and attended by several notable figures, including:</p>
    <ul>
        <li>His Excellency Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology</li>
        <li>Liao Zengtai, Chairman of Wanhua Chemical Group</li>
        <li>Lin Ou, Chairman of Jiangnan Shipyard</li>
        <li>Other prominent Chinese officials and executives</li>
    </ul>

    <h2>ADNOC L&S: A Leader in Low-Carbon Energy Transportation</h2>
    <p>Captain Abdulkareem Al Masabi, the CEO of ADNOC L&S, emphasized the importance of these vessels in enhancing their low-carbon energy solutions and reaffirming the company's commitment to sustainability. He stated:</p>
    <blockquote>
        “This new order... reflects ADNOC L&S’ ongoing efforts to expand its fleet of vessels to support its <strong>low-carbon energy transportation capabilities</strong> and support the energy transition.”
    </blockquote>

    <h2>Bearing Witness to Climate Commitments</h2>
    <p>These advancements are in line with Wanhua Chemical Group’s initiatives to reduce <strong>transportation emissions</strong> and achieve its <strong>decarbonization goals</strong>. The vessels are marked as:</p>
    <ul>
        <li>Low-emission</li>
        <li>Future-proof</li>
        <li>Engineered for environmental sustainability</li>
    </ul>

    <h2>Timeline for Delivery</h2>
    <table class="wp-block-table">
        <thead>
            <tr>
                <th>Vessel Type</th>
                <th>Capacity</th>
                <th>Fuel Type</th>
                <th>Expected Delivery</th>
            </tr>
        </thead>
        <tbody>
            <tr>
                <td>Ethane Tanker</td>
                <td>99,000 cubic meters</td>
                <td>Ethane/Conventional Fuel</td>
                <td>2025 - 2027</td>
            </tr>
            <tr>
                <td>Ammonia Tanker</td>
                <td>93,000 cubic meters</td>
                <td>LPG/Conventional Fuel</td>
                <td>2026 - 2028</td>
            </tr>
        </tbody>
    </table>

    <h2>Future Strategic Investments</h2>
    <p>Following its successful listing on the <strong>Abu Dhabi Securities Exchange</strong> in June 2023, ADNOC L&S plans to invest over <strong>AED 18.4 billion (US$ 5 billion)</strong> in strategic projects. The collaboration with Wanhua Chemical Group and Jiangnan Shipyard is a clear signal of its proactive approach to sustainable shipping.</p>

    <h3>Statements from Key Players</h3>
    <p>Qu Guanggu, President and CEO of Wanhua Chemical Group, expressed his enthusiasm for the contract, stating:</p>
    <blockquote>
        “These low-carbon vessels will support Wanhua Group’s efforts to reduce transportation emissions... a tangible demonstration of its commitment to addressing the challenges of climate change.”
    </blockquote>

    <h2>Implications for the Maritime Industry</h2>
    <p>The implications of this landmark deal extend beyond revenue generation. The construction of these supertankers will:</p>
    <ul>
        <li>Enhance operational efficiency in the maritime sector.</li>
        <li>Contribute to the global effort for <strong>decarbonization</strong>.</li>
        <li>Fuel advancements in shipping technology and standards.</li>
    </ul>

    <h2>Conclusion</h2>
    <p>The strategic partnership between ADNOC L&S and Wanhua Chemical Group heralds a new era in the shipping and energy sectors, positioning both entities as leaders in low-carbon transportation solutions. The commitment to sustainability, innovation, and strategic investments emphasizes their readiness to meet future energy and environmental challenges.</p>
</div>

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