The second-hand LPG carrier market is experiencing an unprecedented boom, with a 19-year-old vessel fetching a price comparable to that of a newbuilding.

Singapore-based LPG owner BW LPG has confirmed that its 52%-owned subsidiary, BW LPG India, has reached an agreement with a third-party buyer for the sale of the Very Large Gas Carrier BW Elm, built in 2007. The vessel will continue to be deployed in commercial operations following delivery.

On a 100% basis, the transaction will generate a net book gain of approximately US$36 million for BW LPG and yield net cash proceeds of roughly US$64 million.

Kristian Sørensen, CEO of BW LPG, revealed that the sale price of this 19-year-old vessel is equivalent to the price level of a newbuilding costing approximately US$248 million. He noted that by selling the BW Elm, the company continues to benefit from a strong second-hand market for older tonnage. The ability to sell a 2007-built asset at near-newbuilding prices, he said, fully demonstrates the commercial platform's acuity and flexibility, as well as its capacity to create value through opportunistic asset allocation.

This sale forms a key part of BW LPG's asset rotation strategy. Shortly before the transaction was finalised, the company returned to the newbuilding market in May 2026, signing a contract with HD Hyundai Heavy Industries for the construction of eight 90,000 cbm Panama-type VLGCs. The total contract value is approximately US$940 million, with a unit cost of around US$117.5 million per vessel. Deliveries are expected to commence from early 2029 through the second quarter of 2030. Mr. Sørensen noted that this order is a key pillar of the company's ongoing fleet renewal programme, underpinned by favourable long-term fundamentals in the LPG market.

Including the BW Elm, BW LPG has a total of 51 vessels listed under its ownership, operation, and bareboat charter arrangements. The BW Elm was one of eight vessels held under BW LPG India, where it was, alongside the BW Birch, the oldest vessel within the subsidiary.

BW LPG India is currently India's largest VLGC owner and operator, handling approximately 20% of the country's LPG import transportation. Notably, the company has also been adjusting its Indian strategy, selling its 8.5% equity stake in India's Confidence Petroleum in June 2026 and fully exiting its local infrastructure investment. This move is aimed at focusing resources more sharply on its core shipping operations and optimising capital allocation through divestment of non-core assets.

The successful sale of the BW Elm marks another step for BW LPG in crystallising the value of older assets at elevated price levels while advancing fleet modernisation. Faced with a market characterised by strong long-term LPG demand coupled with near-to-medium-term vessel supply pressures, the company is employing a dual-drive strategy of "selling old and ordering new" to continuously optimise its asset structure and strengthen fleet competitiveness, thus preserving ample strategic flexibility to navigate future market cycles.

According to BW LPG's second-quarter financial report released in June, the global VLGC fleet currently stands at 429 vessels, with an orderbook of 130 vessels. Over 9% of the in-service fleet is already aged 25 years or older.