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Shell (RDS.A) Signs Agreement to Develop LNG Bunker Vessel

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Royal Dutch Shell plc through its subsidiary Shell NA LNG LLC entered an agreement with Crowley Maritime Corporation to develop a liquefied natural gas (“LNG”) bunker vessel along the East Coast of the United States.

The agreement is part of Shell’s ongoing efforts to expand the LNG bunker vessel fleet to address rapid growth in LNG as an alternative fuel for use in ships. At present, LNG is the fastest-growing segment of the alternative fuel market for long-distance ocean-going vessels.

The bunkering vessel will be constructed at Fincantieri Marine Group’s shipyard at Sturgeon Bay, WI. The design involves Shell and the transportation and logistics company Crowley’s advanced solutions to deliver LNG to various types of LNG containment systems.

The U.S.-built LNG bunker vessel is expected to become operational in 2024. Once completed, it will provide 12,000 cubic meters of LNG capacity and product supply equipment to serve ocean carriers. The 126.7-meter vessel will be the largest Jones Act-compliant unit of its kind.

Shell is actively engaged in developing its LNG bunkering network across the major trade routes. The new bunker barge supports the company’s efforts to provide customers with the energy solution they seek. Notably, this will be the second Jones Act-compliant bunker barge Shell has under a long-term charter in the United States.

The shipping industry is making strides toward decarbonizing and LNG represents an excellent alternative to reduce greenhouse gas emissions, with the potential to become a net-zero emission marine fuel. The agreement will enhance Crowley’s efforts to deliver cleaner and innovative solutions to help the shipping industry continue on the path to decarbonization.

The additional LNG barge will serve as another demonstration to building and servicing sustainable maritime endeavors — both in the United States and worldwide.

Company Profile & Price Performance

Shell is one of the primary oil majors — a group of U.S. and Europe-based big energy multinationals. The company is fully integrated, as it participates in every aspect related to energy from oil production to refining and marketing.

Shares of the company have outperformed the industry in the past three months. The stock has gained 1.1% against the industry’s 4.1% decline.

 

Zacks Investment Research
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Zacks Rank & Stock to Consider

The company currently carries a Zack Rank #3 (Hold).

Some better-ranked players in the energy space are Cabot Oil & Gas Corporation and Petrobras (PBR - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy), and Range Resources Corporation (RRC - Free Report) , currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cabot’s earnings for 2021 are expected to increase 16.9% year over year.

Petrobras’ earnings for 2021 are expected to rise 16.2% year over year.

Range Resources’ earnings for 2021 are expected to increase 32.6% year over year.


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