COMPANY PROFILE
2014
Awilco LNG
+47-2201 4200 | www.awilcolng.no
Excellence in LNG transportation Editorial: Tim Hands
Norway-based LNG transportation provider, Awilco LNG both owns and operates LNG vessels intended for international trade. Its founding shareholder Awilco AS boasts extensive experience within the shipping and offshore sector, with the two forces combining to deliver marine transportation through safety and environmental excellence.
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Awilco LNG Liquefied Natural Gas, or LNG, is natural
2011 was never been involved in LNG,”
gas converted to liquid form for ease of
explains Jon Skule Storheill, Awilco LNG
storage or transportation, which takes up
CEO.
annual growth rate. “Like many others, we were looking for investments and interesting areas in which
about 1/600th of the volume of natural gas
“The company has been involved in a
to invest and thus expand our business,
in its original gaseous state. Natural gas is,
great variety of ship types over the years –
and while LNG was an area that looked
undeniably, a major source of energy, but
predominantly tankers, but also car carriers,
set to continue to grow, the barriers to its
with the majority of towns and cities located
supply ships, offshore rigs and vessels of all
entry are phenomenal. For a start, it is very
far from gas fields and transporting gas
shapes and fashions.” Skule Storheill began
difficult to buy second-hand vessels and
by pipeline so costly and impractical, this
his own career with the company in 2008, as
start trading them, because the owners and
shrinking of its volume makes it infinitely
the Managing Director of Awilco, responsible
the vessels tend to be locked into long-term
easier to store and ship.
for heading up the shipping and offshore
contracts, often for the vessels expected
investments, with the original purchase of
lifetime. Compared to tankers and other
is then returned to a gas via regasification
the three LNG vessels made through Awilco.
commodity carriers it is a very industrialised
facilities, and subsequently piped to homes,
“When we decided to raise equity and order
sort of shipping, and so there are very few
businesses and industries. Its benefits
new builds, as well of course as listing the
transactions,” explains Skule Storheill.
are numerous and centre around it being
company, I took on the job of founding the
the cleanest burning fossil fuel, producing
company and CEO in 2011, which is where
order new vessels, at a cost of around $200
fewer emissions and pollutants than either
I still find myself today having helped build it
million, which is clearly a huge investment.
coal or oil, providing a price-competitive
up to its current position.”
“After having studied the market for a few
When LNG reaches its destination, it
As a result, the only real option is to
years, in the end, we were able to buy three
source of energy that could help meet future burgeoning economic needs across the
INTERESTING LNG
second generation LNG carriers from a
globe.
Awilco identified Liquid Natural Gas
consortium of Japanese owners, at what
as an interesting, viable opportunity in
we found to be a viable price.” At the time,
which is the shipping and offshore side of
2008, looking to enter into a profitable
the plan was to trade these vessels in the
the A Williamson family business. Awilco
transportation market which has been
market while developing infrastructure
has been a ship owner since 1939, but until
steadily expanding with an impressive 7%
projects involving the conversion of these
“Awilco LNG was founded by Awilco,
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Awilco LNG
WilForce Year built Yard Manager Flag Capacity (m3) DWT Draft
| | | | | | |
2013 DSME ALNG TM NIS 156,007 87,750 mt 12.521 m PAGE 5
vessels into storage or terminal vessels. “The
idea of infrastructure projects - these are
and as such it is our aim to grow in line with
company has a strong history of undertaking
extremely slow moving, but we’re very
the industry as a whole.”
major conversions, such as transforming
hopeful of adding something in the near
tankers into heavy lift vessels, and so this
future,” the CEO explains.
The second of Awilco LNG’s newbuilds, WilPride has in recent months been delivered to join its sister vessel WilForce, and while
was a real opportunity for us.”
EXPANSION PLANS
these two ships from Korea’s Daewoo
for every eventuality in a project of this
As well as these infrastructure projects
Shipbuilding and Marine Engineering join its
scale, and in Awilco’s case the vessels
whose development can take many years,
original three vessels, Skule Storheill adds:
were purchased only a few weeks before
expansion looks set to come via various
“We don’t see five ships as an optimal size,
the Fukushima disaster. “This of course
aspects of the business.
and want to grow when the opportunity is
It is, of course, impossible to plan
increased dramatically the need for
“We certainly have ambitions to grow,”
there and timing is right.”
transportation with LNG vessels, and so we
states Skule Storheill, “we’ve been fortunate
put our ambition of conversions on hold and
in being able to place one of our vessels on
THE FUTURE
traded them. In addition to this, we were able
a mid-term contract, with the other trading
It is the old age of many of the existing
to order two new builds in 2011 on the basis
very successfully in the spot market for the
global fleet (30 of which are over 35 years
of issuing about $100 million worth of equity
time-being.
old) which negates the potential risk of
and listing the company.
“We would certainly, though, like to find a
overcapacity in the LNG shipping sector,
“From that point, we’ve basically built the
contract on WilPride, which is ship number
an issue that has been raised by some:
organisation into a fully-integrated LNG ship
two, and ideally land a longer-term contract
“Many players talk about the number of
owner. Today, we have in-house technical
to which we can build the vessel.
unemployed newbuilds,” admits Skule
management, alongside our own crew, and
“Although the LNG market is not growing
Storheill, “but when you analyse the
of course the commercial and operational
in a linear fashion, there is no question that
orderbook you will find that there are today
side is in place. While the organisation is
2017-18 is looking extremely lucrative and
maybe 30 available, and in total maybe 100
complete, we’ve never really dropped the
will entail a huge demand for more vessels,
newbuilds delivering over the next three
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Awilco LNG
question, and the biggest LNG market today
notoriously difficult to penetrate, Awilco LNG
is in Japan and Korea, as well as the Far
now finds itself with an established fleet
tankers are tri-fuel diesel electric ships,
East as a whole. China is growing very fast
of five vessels, certainly not a small fleet,
incorporating induction-based electric
and steadily, a trend that is set to increase
competing with some owners with as much
propulsion motor technology from Wärtsilä
phenomenally going forwards, and so all of
as 40 years of experience in trading LNG.
and GE’s Power Conversion business.
these are our key focus areas,” says Skule
It is a technology which GE claims to be
Storheill.
years which should be very manageable.” Both of Awilco LNG’s newly delivered
among the most environmentally friendly
Of course, the real value in such business
“I think we’re going from being a newcomer to a more seasoned and accepted partner for most major clients,
for sea-going vessels, and supports
growth is in it being undertaken in a
as evidenced by our client list. This is ever-
Awilco LNG’s concerted efforts to boost
responsible manner, an issue that Awilco
growing, and contains the names of most of
its environmental and reliability credentials.
LNG has worked hard to tackle.
the biggest players in LNG transportation.”
Both these new carriers were delivered
“The major benefit to LNG transportation
Projects like Shell’s Prelude floating
on time and on budget after concluding
is that the fuel that we consume is gas, the
liquefied natural gas facility can only help
successful sea trials, with Skule Storheill
cleanest of all fossil fuels with a considerably
to further increase the viability of LNG as
evidently delighted with the results: “We are
smaller CO2 emission than both coal and oil,
a burgeoning energy resource, as Skule
very pleased to take delivery of the vessels,
and one which releases no particles when
Shoreheil details: “It gives producers an
which are built to the highest standard and
burned. In addition, we are just as focussed
economically viable way to extract or
utilise the latest eco-friendly technology
on safety and environmental improvements
produce gas in remote areas, with a floating
that we are looking forward to presenting to
as the whole shipping world in general –
solution meaning you are less dependent
the market.” Wärtsilä and GE’s innovative
there is no waste from the vessels, that’s all
on getting the gas into shore for processing
motor technology also has offers some of
taken care of and recorded in the correct
and shipping, so this is certainly a very
the lowest maintenance costs compared to
manner – and it’s a major focus for LNG
positive sign for the LNG industry. Swathes
alternative solutions, alongside a long service
shipping as a whole, perhaps even more
of other players are now looking at LNG
life and resulting key environmental benefits.
than with tankers and boat carriers. The
and seeing it as a viable alternative for
clients are, to a large extent, more focussed
smaller, and undoubtedly, remote areas,
by Awilco LNG as central to its continued
on this kind of environmental issue,” says
which can only help to further its cause
expansion.
Skule Storheill.
and see its usage become more and more
There are several key markets identified
“We are certainly worldwide orientated, no
Having broken its way into an LNG market
widespread.”
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