MISC Bhd secures new LNG carrier contract, strengthens earnings profile

MISC Bhd has announced a significant contract that will strengthen its long-term earnings profile as it continues investing in newer vessels to support the growing liquefied natural gas (LNG) trade. The company secured a letter of award for the long-term time charter of an 18,700 cubic m LNG carrier from Hudong-Zhonghua Shipbuilding (Group). According to RHB Research, the new vessel is expected to commence its operations in 2028 and will support Petroliam Nasional Bhd’s (PETRONAS) continued supply of LNG to Sendai City, Japan. This latest contract is part of MISC’s ongoing LNG fleet rejuvenation programme, which aims to replace older vessels with modern, fuel-efficient units.

Newbuild details and strategic impact

The new 18,700 cubic m LNG carrier will likely replace one of the group's ageing Aman-class vessels operating on the Malaysia-Japan trade route. Specifically, MISC’s legacy vessel Aman Sendai (built in 1997), which has historically served the Bintulu-Sendai route, is among those nearing charter expiry. While not explicitly mentioned by MISC, it is implied that this older tonnage will be replaced to extend long-term contracted earnings visibility and improve operational efficiency through lower fuel consumption and reduced emissions intensity.

RHB Research commented: "We view the latest award to be largely within our expectations and consistent with MISC’s ongoing LNG fleet renewal strategy. The contract reinforces our long-term investment thesis, but does not alter our estimates." According to RHB Research, the newbuild’s capacity is broadly comparable with MISC's existing Aman-class vessels, suggesting it will replace one of these ageing units.

The research house also noted that replacing older tonnage should extend MISC’s long-term contracted earnings visibility while improving operational efficiency. In a broader context, RHB Research expects the gas assets and solutions segment to play a larger role in the group's earnings mix over the medium term.