CCB Financial Leasing enters into a sale-and-leaseback agreement worth $350 million USD with Awilco LNG for two LNG carriers for refinancing purposes

Project narrative

In October 2019, CCB Financial Leasing Co., Ltd. (CCBFL) — a Chinese state-owned leasing company and wholly-owned subsidiary of China Construction Bank Corporation (CCB) — entered into a term sheet for a sale-and-leaseback agreement worth $350 million USD with Awilco LNG ASA — a Norwegian LNG carrier and transportation company listed on the Oslo Stock Exchange — for two LNG carriers for refinancing purposes. Then, in January 2020, the agreement was finalized. This sale-and-leaseback agreement carried a tenor of 10 years with a 14-year straight line amortization profile, a floating interest rate structure, and was for two 2013-build 156,000 cubic meters Tri-Fuel Diesel Electric (TFDE) LNG carriers, WilForce and WilPride, on a bareboat basis with floating charters (expected to be $45,000 USD per day for each vessel) with the proceeds of the agreement ($175.5 million USD for each) were to be used by Awilco LNG to use refinance those two LNG vessels from their existing sale-and-leaseback agreements, each of the two vessels having a separate back-to-back term financing with different lenders). The CCBFL were expected to reduce Awilco's finance costs by about $7 million USD annually initially compared to the previous agreements on the vessels. The agreement had repurchase options for Awilco from 2023 and a repurchase obligation at the end in 2030.