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BG Group charters three GasLog newbuilds with six options

BG Group charters three GasLog newbuilds with six options
BG Group subsidiary Methane Services Ltd. (MSL) has chartered three GasLog newbuilds, with options to charter a further six by the end of the year.

The firm charters, which commence in mid-2018 and early 2019, will last around 9.5 years, and are worth $845m in fixed revenue to GasLog.

The six optional charters, with an average length of 10 years, would add $1.8bn in revenue should MSL take up the offer, and would start from the vessels' deliveries in 2017.

Hyundai Heavy Industries (HHI) is supplying two of the firm three 174,000 cu m vessels, with the remainder delivered from Samsung Heavy Industries (SHI).

As part of the deal, existing charters on MSL's GasLog vessels will be adjusted, extending two by four months and reducing one by eight months,

GasLog ceo Paul Wogan, commented: “This is another transformational transaction for GasLog, potentially adding nine long-term charters to our fleet. The three firm vessels will add $845m of fixed contracted revenue at attractive day rates. This transaction will also provide long-term charters for three of our unfixed newbuilds that are currently scheduled to deliver in late 2017. The transaction also further extends the pipeline of vessels we have available to drop down into GasLog Partners and we believe enhances our sum-of-the-parts valuation.”

Andy Orekar, ceo of GasLog Partners, added, “Today’s transaction adds up to nine vessels under long-term contracts to GasLog Partners’ dropdown pipeline, giving us additional visible growth for multiple years. The immediate addition of three firm charters brings our total current pipeline to 15 LNG carriers, which would increase further to 21 vessels if MSL exercises its option for the six additional newbuildings."