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Sovcomflot and Total increase cooperation in LNG transportation

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PAO Sovcomflot (SCF Group) and Total have concluded a time charter agreement for up to 7 years for a newbuilding 174,000-cbm LNG carrier, to be owned and operated by SCF, with options for up to two additional vessels.

The ceremony was held on 21 January 2021 and was attended via videoconference by: Igor Tonkovidov, President and Chief Executive Officer of PAO Sovcomflot; Thomas Maurisse, Senior Vice President for LNG at Total, and Seong-Yong Park, Senior Executive Vice President and Chief Operating Officer of Hyundai Heavy Industries.

Pictured: Igor Tonkovidov, President and Chief Executive Officer of Sovcomflot

Pictured: Thomas Maurisse, Senior Vice President for LNG at Total

The new vessel will be the latest in a series of SCF’s new-generation conventional Atlanticmax LNG carriers, with three sister ships already in operation: SCF La Perouse, SCF Barents and SCF Timmerman.

The vessel will be fitted with an X-DF propulsion system, operated by a slow-speed diesel engine with a direct drive to the propellers, which will enable a substantial reduction in the vessel’s fuel consumption when compared with previous generations of LNG carriers.

The new carrier will also be fitted with a hull air lubrication system which, combined with  two shaft power generators with frequency-to-current converters, is expected to deliver a further significant decrease in fuel consumption and greenhouse gas emissions.

Another environmental feature of this series of new-generation vessels is a partial re-liquefaction system, which allows cargo boil-off gas to be returned to the tanks.

Delivery of the LNG carrier to the Charterer is scheduled for the third quarter of 2023.

Igor Tonkovidov, President and CEO of PAO Sovcomflot, said:

"We are pleased that SCF Group’s shipbuilding programme will be supplemented with a new gas carrier that meets all the current international standards regarding environmental protection, as well as the Charterer's requirements for energy efficiency, quality and navigational safety.

“We are grateful to our valued partners at Total for the opportunity to participate in this interesting project which extends further our cooperation in LNG transportation with one of the world’s leading international energy companies.

“The success in Total’s project tender once again demonstrates SCF’s high standards and capabilities in LNG shipping as well as with other types of energy.

“The continued development of our energy transportation services that serve long-term projects, provides the fixed return element to SCF’s business model. It is in line with the corporate strategy approved by our shareholders and allows us to reduce the negative impact of conventional tanker freight market fluctuations on the Company’s results."

SCF Press Office

PAO Sovcomflot (MOEX:FLOT) is one of the world's leading energy shipping companies, specialising in the transportation of crude oil, petroleum products, and liquefied gas, as well as the servicing of offshore oil and gas production. The Group’s fleet comprises 146 vessels with a total deadweight of over 12.7 million tonnes, including vessels owned through joint ventures. More than 80 vessels have an ice class.

Sovcomflot is involved in servicing large oil and gas projects in Russia and around the world: Sakhalin-1, Sakhalin-2, Varandey, Prirazlomnoye, Novy Port, Yamal LNG, Tangguh (Indonesia). The company is headquartered in Saint Petersburg, with offices in Moscow, Novorossiysk, Murmansk, Vladivostok, Yuzhno-Sakhalinsk, London, Limassol, and Dubai.

SCF currently has 16 gas carriers in operation, with further 19 vessels under construction, including the latest vessel mentioned in this release. The Group has been an independent owner and operator of LNG carriers since 2006 and was the first Russian company to successfully enter this premium segment of the global shipping market. Amongst the key charterers of the gas fleet are: Gazprom; Sakhalin Energy; Shell; Yamal LNG; Sibur, and Tangguh LNG.

Important disclosure:

The media release (the “Materials”) of PAO Sovcomflot (the “Company”) has been prepared solely for information purposes and are not intended for potential investors and do not constitute or form part of, and should not be construed as an offer or the solicitation of an offer to subscribe for or purchase securities of the Company, and nothing contained therein shall form the basis of or be relied on in connection with any contract or commitment whatsoever nor do they constitute a recommendation regarding such securities. The Materials are not intended to provide, and should not be relied upon for, accounting, legal or tax advice. No reliance may be placed for any purposes whatsoever on the information contained in the Materials or on its completeness. Details included in the Materials are subject to updating, revision, further verification and amendment. The Company is not under any obligation to update or keep current the information contained in the Materials.

Certain statements in the Materials may constitute forward-looking statements. Any statements that address expectations or projections about the future, including statements about operating performance, market position, industry trends, general economic conditions, expected expenditures and financial results, are forward-looking statements. Forward-looking statements may be identified by words like “expects”, “anticipates”, “plans”, “intends”, “projects”, “indicates” and similar expressions. Any statements contained herein that are not statements of historical fact are forward-looking statements. Such statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Accordingly, actual results or the performance of the Company or its subsidiaries may differ significantly, positively or negatively, from forward-looking statements made herein.