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Riding the wave of record earnings, a Stamford-based shipping company is putting money into new vessels.
Dorian LPG Ltd. said Friday it will spend about $345 million on three new gas carriers, its first major fleet order since the closure of the Strait of Hormuz sent shipping rates soaring.
The ships will be built by Hanwha Ocean, a South Korean shipbuilder, and delivered in June, September and December 2030. Each will carry 90,000 cubic meters of cargo and be small enough to transit the older, narrower locks of the Panama Canal, giving customers more routing options.
The vessels will be capable of running on liquefied petroleum gas or conventional low-sulfur fuel, part of Dorian’s effort to reduce emissions.
“These newbuildings reflect our measured approach to fleet renewal coupled with a capital allocation strategy that drives long-term shareholder value creation,” Chairman, President and CEO John C. Hadjipateras said.
Dorian owns and operates 25 tankers that transport propane and butane around the world. The company leases its vessels at daily charter rates.
Charter rates more than doubled after the closure of the Strait of Hormuz forced Asian buyers to source more cargo from the U.S. Gulf Coast instead of the Middle East.
Dorian said Friday it has booked 99% of its sailing capacity for the quarter ending Sept. 30 at more than $88,000 per vessel per day.
That compares with an average rate of $75,926 per day in the quarter ended June 30, when Dorian reported a record $138.3 million in net income.
The company cautioned investors that unusually high charter rates may not last if shipping routes return to normal.
Dorian also refinanced a large portion of its debt. On Sept. 2, it entered a seven-year, $368.4 million credit facility that consolidates four existing loans.
The company has offices in Stamford, Copenhagen and Athens, Greece.
