BW LPG flips Avance-acquired VLGC for over $100m, booking $37m gain

BW LPG has agreed to sell the 2015-built very large gas carrier BW Mistral for well over $100m, booking an expected net gain of around $37m on a ship it acquired for less than two years ago through John Fredriksen's Avance Gas transaction. The sale generates net cash proceeds of approximately $104m for the New York- and Oslo-listed gas carrier giant, which has not disclosed the buyer.

The numbers translate the flip into plain terms: on a single nine-year-old vessel, BW LPG is realising a gain roughly equivalent to the price of a modern mid-size tanker. The 83,134 cu m BW Mistral was built at China's Jiangnan shipyard and is scrubber-fitted. It is currently trading in the spot market and will keep earning revenue for BW LPG until its scheduled handover by mid-January 2027, according to the company.

Chief executive Kristian Sørensen said the ship had contributed significantly to earnings since joining the fleet in 2024. He added that the company is now taking advantage of strong secondhand values to realise a sizeable return.

What does the sale mean for the Avance deal?

The disposal marks another profitable exit from the 12-ship Avance Gas fleet that BW LPG acquired in August 2024 for $1.05bn in cash, shares and assumed debt. The transaction, which absorbed the operations of John Fredriksen's LPG arm, has become a platform for asset trading as much as consolidation.

In July, BW LPG agreed to sell a sister vessel from the same deal, the 2015-built, 83,000 cu m BW Levant. That sale carried expected net cash proceeds of $38m and a book gain of around $17m. Taken together, the two disposals are set to generate combined book gains of approximately $54m and net cash proceeds of $142m.

For a carrier of BW LPG's scale, that means nearly a seventh of the original Avance purchase price has already returned as cash from just two vessel sales, while ten ships from the package remain in the fleet.

How does the sale fit BW LPG's fleet strategy?

The latest exit forms part of a broader fleet renewal drive on two fronts. The company's 52%-owned Indian subsidiary has also been selling older VLGCs, most recently agreeing to dispose of the 2008-built BW Loyalty for a price in the low-$80m range, with an expected gain of $52m.

At the other end of the fleet age profile, BW LPG has committed around $940m to eight 90,000 cu m panamax VLGC newbuildings at HD Hyundai Heavy Industries in South Korea. Those ships are scheduled for delivery between 2029 and 2030.

The pattern is straightforward: monetise vintage tonnage at historically elevated secondhand values, and redeploy capital into larger, modern capacity arriving later in the decade. The BW Mistral and BW Loyalty sales alone pull in roughly $186m of combined proceeds against combined gains approaching $89m.

What comes next?

With the BW Mistral earning spot revenue until its mid-January 2027 handover and eight newbuildings still ahead, BW LPG's asset-trading cycle shows no sign of slowing while secondhand VLGC values hold firm.