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Sustainable Fund Launched for Methanol Fleet

Maritime Activity Reports, Inc.

November 9, 2023

Source: ProMarine

Source: ProMarine

ProMarine AG has launched an industry-first sustainable shipping fund with an initial portfolio of four methanol-fuelled MR tankers led by Proman and Stena Bulk.

Low Emission Methanol Shipping Company S.C.A. SICAV–RAIF (LEMSCO) is the result of a collaboration between Proman and Stena Bulk. The fund is backed by equity investors and benefits from a green loan from ABN AMRO. LEMSCO's seed assets consist of four methanol fuelled vessels acquired from Proman and Stena Bulk: Stena Pro Patria, Stena Pro Marine, Stena Promise and Stena Prosperous.

Fully re-engineered for low resistance and efficient propulsion, these IMOIIMeMAX vessels are amongst the most energy efficient and sustainable MR tankers in the world, with methanol power providing a pathway to eliminating nearly all greenhouse gases.

LEMSCO will also benefit from a dedicated methanol supply contract from Proman.

David Cassidy, Chairman of the ProMarine Board and Chief Executive of Proman, said: "We are delighted to be launching LEMSCO, which is pioneering in its efforts to address the air pollution and wider environmental concerns surrounding the maritime industry. We all recognise that the transition to sustainable shipping requires significant capital investment. By providing an alternative financing mechanism, LEMSCO plays a crucial role in bridging this gap and facilitating the industry's transition to lower emission fuels."

He added, "We are grateful to our partners and to ABN AMRO for their important early support. LEMSCO demonstrates the market's readiness to offer practical financial incentives through reduced cost funding for ships fuelled by low-emission methanol and can be the catalyst for further investments into sustainable shipping."

Erik Hånell, Board Member of ProMarine and President and CEO at Stena Bulk AB, said: "The launch of LEMSCO is a pivotal moment, showcasing the maritime industry's commitment to a sustainable future. Through strategic collaboration and innovative green financing, we are shaping a new era of maritime operations, prioritising low-emission methanol as a viable alternative fuel. LEMSCO represents a step towards meaningful change, enabling investors to support a greener, more sustainable shipping industry. Together, we are charting a course towards cleaner oceans and a more responsible shipping industry".

ABN AMRO provided debt financing to the fund which was independently assessed against the LMA Green Loan Principles and has been successfully designated as a Green Loan by DNV.

Law firm HFW advised the fund and also supported Proman and Stena Bulk on the transaction. The HFW team was led by Gudmund Bernitz and Katherine Noble, who advised on the finance, shipping, and fuel-supply aspects, supported by HFW's Owen Webb and Andrzej Czernis. HFW's Alex Kyriakoulis, Audrey Hsieh, and Grace Serena-Heaton advised on corporate aspects; Anthony Woolich advised on IP aspects; and Adam Topping advised on regulatory matters.

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