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Fjord Line Update - Rebuilding Vessels on Norway-Denmark Routes

Fjord Line is rebuilding LNG-ships to resolve the impact of the energy crisis

Fjord Line has decided to rebuild the two LNG-ships MS Stavangerfjord and MS Bergensfjord from single-fuel LNG-engines to dual-fuel LNG/MGO-engines.

After two years of a global pandemic and government-imposed travel restrictions, Fjord Line had the best-ever high season revenue wise in 2022. Unfortunately, increases in the LNG (Liquified Natural Gas) fuel costs has led to a non-sustainable financial situation for Fjord Line.

The energy crisis, caused by the Russian invasion of Ukraine, has led to extraordinary volatility and significant price increases in LNG - and the price increases have been far higher than for traditional and less sustainable energy sources at sea. In addition, Fjord Line receives no governmental financial energy-aid. This has led to a dramatically increase in the energy costs for Fjord Line’s two LNG-operated ships, and significantly above a financially sustainable level.

Since early Fall, the LNG-ship departures from Vestlandet in Norway, Denmark, and Langesund in Norway have been reduced as well as the crossing time has been increased. This is of course not the way Fjord Line intend to operate our routes or the desired customer offering. However, adjustments to our route operations were necessary as a consequence of the extraordinary high fuel costs especially on LNG. In addition, we have worked immensely hard to develop and evaluate long-term alternatives enabling a return to our ordinary route operation on the routes between Vestlandet in Norway and Denmark and the route between Langesund and Hirtshals. Fjord Line has now decided to rebuild the two LNG-ships MS Stavangerfjord and MS Bergensfjord from single-fuel LNG-engines to dual-fuel LNG/MGO-engines during Spring 2023.

The engine conversion enables the two LNG-ships to switch between LNG and MGO (Marine Gas Oil), which will ensure a financially sustainable operation until the LNG-price level is normalized. Fjord Line is a pioneer within LNG-ship operation and our award-winning LNG-ships had the most innovative and sustainable fuel solution when launched in operation during 2013 and 2014. We are saddened by the need for the conversion towards use of MGO, despite Marine Gas Oil having a significant reduced emissions of sulphur than traditional fuel such as HFO (Heavy Fuel Oil). The conversion is however critical to maintain our customer offering, secure workplaces, and to secure the continued development of Fjord Line, says CEO, Brian Thorsted Hansen.

Rebuilding of LNG-ships

Rebuilding of MS Stavangerfjord will start in January 2023 and will be finalized by the end of May 2023. MS Bergensfjord will be rebuilt during February to medio June 2023. The routes affected by the rebuilding are Bergen - Stavanger - Hirtshals, and Hirtshals - Langesund. Fjord Line’s other routes Sandefjord – Strömstad, and Kristiansand - Hirtshals are not affected by the changes and will operate as normal.

The ships are being rebuilt at Fosen Yard and the engines will be delivered by Wärtsilä.

Fjord Line has concluded a refinancing as part of the rebuilding of the two ships and due to the current energy crisis. A refinancing where our owners and lenders jointly have secured the continued development of Fjord Line’s strong position.

During the COVID-19 pandemic and the energy crisis the owners have contributed with new capital in the amount of 500 million NOK to Fjord Line.

Our sincere apologizes to our customers

As a result of the engine conversion plan, Fjord Line will unfortunately not be able to maintain our customer offering on the routes Bergen - Stavanger - Hirtshals, and Hirtshals – Langesund during February 8th till May 25 th, 2023. We sincerely apologies to our private- and business-/freight customers using Fjord Line on these critical ferry routes between Norway and the continent, and consequently being affected by the changes, says Brian Thorsted Hansen.

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During the time of conversion, Fjord Line will invest in our employees by continued competences development to secure our strong foundation and development, and we look forward to welcoming our passengers and freight customers back to our ships when the rebuilding is completed.

Fjord Line has led the way in the green transition and is the only Norwegian shipping company that transports passengers as well as cargo, internationally, on two ships powered by LNG. This enables up to 25% CO2-savings and greatly reduced emissions of sulphur- and nitrogen oxides. We are proud of our contribution towards responsible business operations and our ambitions to be a leading contributor towards sustainable and innovative ferry operations remain.

Fjord Line

04 January 2023

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