MITSUI O.S.K. Lines (MOL) has announced it has entered an agreement with Singapore LNG Corporation for a Floating Storage and Regasification Unit (FSRU).

The Japanese shipping line announced the agreement yesterday (October 23) with Singapore’s state-owned LNG terminal operator, for a long-term time charter contract for the newbuild floating facility.

The FSRU will be moored at the Jurong Port in Singapore, and will play a central role in receiving, storing, and regasifying LNG, and sending gas to shore.

It is the FSRU to be introduced in Singapore is expected to contribute to a stable supply of energy for the country, where about 95% of domestic power generation is fueled by imported natural gas.

The FSRU will be built at Hanwha Ocean Co. shipyard in South Korea. After delivery, MOL will own, manage, and operate the facility.

The FRSU, to be built in the form of a vessel, will measure 298 metres length-overall, and feature and LNG storage capacity of 200,000 cubic metres. The facility is scheduled for delivery in 2027.

“As a leading player in FSRU solutions, MOL has accumulated many years of experience operating FSRUs in diverse regions and environments, including Turkey, Hong Kong, and Indonesia, and has earned a high level of trust from its customers,” MOL said in a statement.

“MOL has been developing its FSRU business around the world to meet the needs of customers who want to diversify their procurement of LNG and ensure a stable supply of energy, and it has recently entered into an agreement on an FSRU project in Poland.”

According to MOL, FSRU’s have the advantage of lower costs and shorter construction periods compared to constructing storage tanks and regasification facilities onshore.

The group says the project is in line with its “Blue Action 2035” management plan for the growth of non-shipping businesses, and fits into its strategy of expanding low-carbon and decarbonised business.

The announcement follows the news from MOL last month of a new agreement with Chevron Shipping to install the Wind Challenger hard sail system on a newbuild LNG carrier, currently under construction.