GasLog Ltd. (GasLog) (NYSE: GLOG) took delivery last Wednesday (Apr01) of the GasLog Windsor, a 180,000 cubic meter cargo capacity LNG carrier with X-DF propulsion and Mark III Flex containment system. Despite the industrial disruption in South Korea caused by the COVID-19 outbreak, the vessel was delivered on time and on budget. It will immediately commence a seven-year charter with a wholly-owned subsidiary of Centrica plc.
Operational Update
GasLog and GasLog Partners LP (GasLog Partners) (NYSE: GLOP) remain focused on securing the health and safety of their employees whilst ensuring safe and reliable operations for their customers and the global natural gas supply chain. To date, there have been no known cases of COVID-19 infection amongst the Group’s sea-going or shore-based personnel. During the first quarter, extensive measures were taken to limit the impact of COVID-19 on GasLog’s and GasLog Partners’ business. These have included:
- Establishing a dedicated COVID-19 task force to implement and constantly review and amend the Group’s business continuity plan as required;
- Instituting a world-wide work from home policy for all onshore employees; and
- Developing strict guidelines restricting access to all vessels and suspending shore leave and all crew changes for 30 days from mid-March.
These measures, combined with the dedication of employees both onshore and onboard the Group’s vessels, have delivered fleet availability of close to 100%. It has also allowed GasLog and GasLog Partners to accelerate opportunistically their dry-docking schedules during the slowdown of LNG trade in February and March. Four dry-dockings will have completed by mid-April, all of which are expected to be on time and within budget, including the installation of ballast water treatment systems.
Commercial Update
- The charter parties for all of the Group’s term-chartered vessels remain in effect with revenues as per the contract terms;
- During the first quarter of 2020, the Group’s tri-fuel diesel electric vessels operating in the spot and short-term market delivered time charter equivalent earnings of c.$44,000/day;
- Presently, all of the Group’s vessels operating in the spot and short-term market that are not undergoing dry-dockings are on charters through to at least May. There has been a marked increase in activity in the spot and short-term market in recent weeks, primarily driven by a resumption in industrial activity in China. As a result, the Company expects to secure additional employment for its vessels ahead of the conclusion of their current fixtures.
- On March 26th, 2020, the Greek utility company Gastrade S.A (20% owned by GasLog) announced the successful conclusion of the binding phase of the market test for reservation of capacity at the floating LNG terminal being developed at Alexandroupolis in northern Greece. This reservation of 2.6 billion cubic meters of capacity for periods out to 15 years represents a key milestone for the project.
Paul Wogan, Chief Executive Officer of GasLog, stated “Against a backdrop of unprecedented global uncertainty, I am very proud of the dedication of all our employees, whose health and safety remains our first priority. The COVID-19 outbreak has presented many challenges to our business, and I have been deeply impressed with how our people have risen to these and maintained the highest standards of customer service. I especially thank our seafarers for their commitment and professionalism while apart from their families and friends.
I am also delighted that, through working closely with our partners at Samsung, we have taken delivery as planned of the GasLog Windsor which immediately delivered into an attractive seven-year charter to Centrica. This vessel is the first of seven newbuildings due to deliver by the third quarter of 2021, representing $145 million of additional aggregate EBITDA. On a fully delivered basis, 60% of GasLog’s directly owned fleet will be modern X-DF vessels on multi-year term charters.”
Source: GasLog