Mitsui OSK Lines (MOL) has concluded a syndicated transition loan for two LNG-fuelled ferries – ’Sunflower Kurenai’ and ‘Sunflower Murasaki’.
The Development Bank of Japan (DBJ) and Sumitomo Mitsui Trust Bank (SMTB) served as the arrangers and Sumitomo Mitsui Banking Corp (SMBC) as the co-arranger.
In addition to the three banks, this transition loan was jointly provided by 10 local financial institutions from mainly Western Japan, near the routes on which the two ferries will operate and close to the shipyards where they will be built.
This transaction was selected as the first transition loan in Japan for the Ministry of Economy, Trade and Industry (METI)’s climate transition model projects.
Eligibility for the loan received third-party evaluation from the Japan Credit Rating Agency, as the loan conformed to the Climate Transition Finance handbook published by the International Capital Market Association (ICMA) and the Green Loan Principles (GLP) developed by working groups, such as the ICMA’s Green Bond Principles (GBP).
The two vessels will be Japan’s first LNG-fuelled ferries. They will be operated on the Osaka/Beppu route by MOL Group company, Ferry Sunflower. They are due for delivery from the end of 2022 to early 2023.
The MOL Group established MOL Group Environmental Vision 2.1 in June, 2021 with the aim of achieving net zero GHG emissions by 2050.
It plans to operate about 90 LNG-fuelled vessels by 2030, as an ‘introduction of clean alternative fuels’ to realise this vision, the company said.