MISC Berhad has signed a 20-year charter agreement with PETRONAS LNG Ltd for five newbuild liquefied natural gas carriers (LNGCs), reinforcing Malaysia’s long-term position in the global LNG shipping market while supporting cleaner maritime operations.
The agreement follows the conclusion of shipbuilding contracts between MISC and China’s Hudong-Zhonghua Shipbuilding Group earlier this year. The five 174,000 cubic metre LNG vessels are expected to be constructed between 2026 and 2029, with charter operations slated to commence between 2029 and 2030.
According to analysts at MBSB Research, the new vessels will feature next-generation technologies aimed at improving fuel efficiency and reducing emissions. The LNGCs will utilise dual-fuel XDF2.1 propulsion systems designed to minimise methane leakage and optimise fuel consumption, alongside shaft generators and onboard reliquefaction systems to maximise cargo efficiency.
The research house said the long-term charter arrangement would strengthen PETRONAS’ LNG supply chain amid tightening environmental regulations and rising global LNG demand. The deal is also expected to provide MISC with a stable long-term revenue stream insulated from fluctuations in spot charter rates.
MBSB Research noted that older LNG carriers globally are increasingly facing retirement pressures due to stricter International Maritime Organization (IMO) carbon intensity regulations. The addition of newer eco-friendly vessels before 2030 is expected to help PETRONAS maintain competitiveness in the LNG market while aligning with Malaysia’s National Energy Transition Roadmap (NETR).
The brokerage estimates that each next-generation LNG carrier could cost between RM1.18 billion and RM1.23 billion, with MISC likely to finance the project using an 80:20 debt-to-equity structure. This could result in approximately RM4.5 billion in additional borrowings, with the remaining funding sourced from internal cash reserves.
Long-term charter rates for eco-LNG vessels are estimated at between USD85,000 and USD95,000 per day, potentially contributing around RM150 million in annual revenue per vessel to MISC’s topline. Based on an estimated operating margin of 25% for the gas assets segment, the research house projected the agreement could contribute an additional RM180 million to RM200 million in earnings annually from 2029 onwards.
Despite the positive long-term outlook, MBSB Research maintained its “Neutral” call on MISC with a target price of RM8.13, pending further clarity on the agreement and the group’s upcoming first-quarter FY2026 earnings announcement.
