Navigator Gas: Turning Project Finance on Its Head

Cambridge Partners’ most recent offering “Navigator Gas Transport PLC” was formed for the purpose of building and operating a fleet of five state-of-the-art 22,000 cubic meter semi-refrigerated ethylene-capable gas carriers. The Company states that these vessels will be among the “most versatile gas carriers in the world in terms of cargo options, ease and speed of loading and discharging cargoes and adaptability for route scheduling.” Further, the Company believes that the gas freight market represents “one of the most attractive sectors of the shipping industry in terms of its robust underlying demand growth economics and outlook for limited expansion in freight capacity.” Pretty heady stuff to lay on a high yield fund manager with bulging pockets.

We will be upfront: we make no bones of our concerns wherein a pure financial operator promotes a big money deal on terms that commercial banks would blanch at to construct a new class of sophisticated ships, demand for which has not yet been demonstrated in a market segment dominated by a handful of large, well-established owners at a shipyard which, while making progress, clearly is not in the same league as the more established yards building this type of vessel.

This is only an excerpt of Navigator Gas: Turning Project Finance on Its Head

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