Houston-based Excelerate Energy Thursday announced plans to nearly double its fleet of LNG carrier/regasification ships, striking another deal with Exmar NV, Antwerp, Belgium to take an equity interest in three more of the dual-purpose vessels, called "Energy Bridge" ships. The added ships will push its total fleet to nine when these three and two others already in construction are launched.
Exmar owns and operates the ships; Excelerate charters them for its growing global trade. The ships will be built in South Korea by Daewoo Shipbuilding & Marine Engineering Co. Ltd.
Excelerate currently is operating three Energy Bridge ships and one conventional LNG carrier, with two other dual-operations vessels under construction with staggered targeted delivery for the spring of 2008 and 2009. With the three additional vessels chartered, Excelerate said its nine-ship fleet will approach $2 billion in value, or an estimated 2.5% of the world's LNG shipping fleet.
While the West Coast of North America so far is rejecting offshore LNG concepts (see Daily GPI, April 16), Excelerate opened its Gulf (of Mexico) Gateway Port two years ago, and Teeport in northern England last February and is slated to start construction on Northeast Gateway Deepwater Port in Massachusetts Bay in June.
The latest agreement between Exmar and Excelerate includes two ships ordered last year by Exmar as well as an order for an additional ship that was concluded in Antwerp Thursday. The trio will be delivered between the third quarter of 2009 and the second quarter of 2010, meaning the company will more than double its present fleet in two years -- from spring 2008 first delivery of the ships now under construction.
"These additions demonstrate [our] commitment to remain a leader in worldwide LNG floating regasification," said Excelerate CEO Kathleen Eisbrenner. A larger fleet with the ship-to-ship transfer capability will provide Excelerate with what she called "unparalleled flexibility and access to markets around the world."
Excelerate COO Rob Bryngelson said the larger fleet is critical to its plans for a third offshore port in Massachusetts Bay, along with allowing it to expand current operations in Asia, South America and Europe.
Excelerate intends to run its fleet as carriers and regasification/transfer facilities. "The ships are fully functional as a conventional LNG carrier and a regasification plant," said Jonathan Cook, an Excelerate vice president who spoke with NGI Thursday. "We've used the ships more as conventional carriers right now because of the conventional trading in the site, or spot, markets."
Cook said that offshore LNG technology is essentially commercial right now, although he acknowledges that not everyone in the industry agrees with his assessment, and elected officials and others in California are viewing it as an "untested" technology for handling LNG receipts.
Not surprisingly, Cook disagrees, contending all of the components in the Energy Bridge vessels involve what he called "proven technology," which Excelerate originally began developing seven years ago. "To understand how we have been comfortable with the process all along, you have to look at each of the components," he said. "Each of the components are well-proven technologies that have been used for many years in different applications [some oil industry and some natural gas]."
At this point, Excelerate's senior officials stress that it is the only company to have successfully performed commercial ship-to-ship LNG transfers to date. They stress their ships' flexibility in being able to do ship-to-ship or traditional offloading at a land-based terminal, and also onboard regasification with delivery directly into a natural gas transmission pipeline network from a submerged connection.
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