Navigator Gas completes terminal expansion, buys three ethylene carriers

January 8, 2025, by Naida Hakirevic Prevljak

Navigator Holdings (Navigator Gas), a UK-based owner and operator of the ‘world’s largest’ fleet of Handysize liquefied gas carriers, has completed the expansion of its Morgan’s Point ethylene terminal and committed to buying three 17,000 cbm ethylene carriers.

The terminal is a joint venture owned 50/50 by Navigator and Enterprise Products Partners at Morgan’s Point, Houston, USA.

As informed, the expansion project was completed on time in late-December 2024 and within budget. Going forward, the flex train is expected to increase ethylene export capacity at Morgan’s Point by at least 550,000 tons to 1.55 million tons per year starting in 2025, and potentially up to a total of 3.2 million tons per year in the coming years.

Further, the expansion is anticipated to triple the current instantaneous ethylene refrigeration capacity at Morgan’s Point from 125 tons per hour to 375 tons per hour. The expanded capacity will utilize the export terminal joint venture’s existing 30,000-ton refrigerated tank which will continue to facilitate loading vessels at Morgan’s Point at 1,000 tons per hour.

Additionally, the joint venture has signed an increased and extended offtake agreement with its largest offtaker with the additional volumes starting in the first quarter of 2025.

To further support the expansion project by increasing Navigator Gas’ fleet of ethylene-capable vessels, the company has also entered into agreements with an unrelated third party to acquire three German-built 17,000 cbm vessels.

Although the company did not disclose further details about the transaction, VesselsValue’s data shows that the liquid ethylene gas (LEG) carriers in question are Gaschem Antarctic, Gaschem Pacific and Gaschem Adriatic, acquired for $28.3 million, $29 million and $29 million, respectively. The units, built between 2009 and 2010, were acquired from the German shipping company Harpain Reederei in December 2024.

Delivery of the Handysize vessels is expected to take place between February and May 2025, at the latest, Navigator Gas said.

The vessels are anticipated to operate in the spot market upon delivery or soon after. The company added it does not intend to issue any new capital but plans to finance the acquisitions with a combination of cash on hand and new debt.

The transaction is subject to customary closing conditions, and following its completion, Navigator Gas will own and operate a fleet of 59 vessels, 28 of which will be ethylene and ethane capable.

“Future demand for competitively priced US ethane and ethylene is likely to continue its upward trajectory in the coming years. The ethylene export terminal expansion, and the addition of three handysize ethylene carriers to our fleet, provides us with key capabilities and infrastructure to meet that growing demand. With the most recent offtake agreement set to boost throughput in the near-term, together with the additional vessels, we expect our investments to be accretive to earnings in 2025 and beyond,” Mads Peter Zacho, CEO of Navigator Gas, commented.

In related news, Navigator Gas ordered last year a total of four 48,500 cbm liquefied ethylene gas carriers (LEGCs) in China. The ships will be built at Jiangnan Shipyard and China Shipbuilding Trading.