Japanese shipping giant MOL said it has concluded a syndicated “transition loan” for its two LNG-powered ferries under construction.
Under the agreement, the Development Bank of Japan and Sumitomo Mitsui Trust Bank, served as the arrangers, and Sumitomo Mitsui Banking Corporation as the co-arranger, MOL said in a statement.
Besides these banks, 10 local financial institutions located mainly in Western Japan also took part in providing the financing.
MOL said this marks the first “transition loan” in Japan for the Ministry of Economy, Trade and Industry (METI)’s climate transition model projects.
The firm explained that “transition loan” is a commitment line with the purpose of supporting corporations that engage in the reduction of greenhouse gases in line with long-term transition strategies as set out in the goals of the Paris agreement.
Also, eligibility for the loan received third-party evaluation by the Japan Credit Rating Agency.
According to MOL, the loan “conforms to the Climate Transition Finance handbook published by the International Capital market Association and the Green Loan Principles developed by experienced working groups such as the Green Bond Principles of the International Capital Market Association.”
To remind, MOL ordered the two LNG ferries, Sunflower Kurenai and Sunflower Murasaki, at Mitsubishi Shipbuilding back in 2019. MOL’s firm Ferry Sunflower will use both these vessels, claimed to be Japan’s first LNG-powered ferries, on its Osaka-Beppu route.
The shipping firm has also earlier this year signed a basic deal with compatriot Kyushu Electric Power for the supply of liquefied natural gas to the vessels.
MOL expects to take delivery of the first ferry in December 2022, followed by the second in March 2023.