ICONIC Project Finance (DXB) advised XIAMEN Shipbuilding Industry Co in connection with the shipping finance of two Liquefied Natural Gas (LNG)-fueled Ro-Ro vessels.
Both ships are the first overseas car freighters in the world to be LNG-powered, while representing an important building block for the strategic goal of climate-neutral logistics. The vessels are to replace two of the nine conventional heavy oil-powered cargo ships currently used by VW Group logistics on the Atlantic between Europe and North America. The SIEM CONFUCIUS is to be integrated into this service from January 2020 after its transfer from Asia to Europe. The second ship, SIEM ARISTOTLE will start operations in spring 2020 in the same area.
The two technologically advanced ships, each 200 meters long and 38 meters wide, have 13 car decks and a capacity of 7,500 RT, which corresponds to approximately 4,700 vehicles. Both vehicle transporters are powered by a 12,600 kW dual-fuel marine engine with direct injection and exhaust gas treatment. In addition to liquid, deep-frozen natural gas, they can also be operated with environmentally friendly e-gas produced via Power-to-X or biogas. In eco-speed mode, the ships are running 16.5 knots (30.6 km/h). With their two tanks, each holding 1,800 cubic meters, the transporters have similar vehicle capacities and ranges compared to conventional heavy oil-powered ocean freighters.
Gordon Batman, a corporate partner in IPFA’s London office who co-led the firm’s deal team, commented:
“We are delighted to advise Xiamen Shipbuilding on this milestone achievement. The deal exemplifies IPFA’s capabilities advising on cutting edge cross-border transactions and ability to draw upon the firm’s global platform to provide clients with a premier multidisciplinary deal team.”
ICONIC represented Xiamen Shipbuilding in the transaction with a project finance deal team led by London’s partner Gordon Batman, Tokyo partner Sal Fischer, Dubai partner Renaud Niche, and Piraeus adviser Yiorgos Andrianopoulos, with associates Elias Christodoulou, Antonios Vardakastanis and Gustavo Yakana. Advice was also provided on corporate finance by Dubai adviser Giovanna Ribeiro.
Ceremonial ship launching of low-emission LNG Ro-RO for overseas car freighters at XIAMEN
The LNG engines reduce carbon dioxide emissions by up to 25%, nitrogen oxide emissions by up to 30%, particulate matter by up to 60% and sulphur oxide emissions by up to 100% per ship.
Yiorgos Andrianopoulos, Shipping Finance Adviser in Piraeus commented:
“We believe that the switch to LNG as marine fuel is the most important basis for a maritime energy revolution. In a second step, gas-capable ships can be operated with synthetically produced, climate-neutral fuels and are therefore future-proof. With this project, XIAMis pioneering the decarbonisation of global trade flows”.
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