Pasha Hawaii has celebrated significant “firsts” within the past year. In August 2022, the company made history by welcoming the first of its two natural gas powered ‘Ohana Class vessels to its fleet called MV George III, a 774-foot Liquefied Natural Gas (LNG) fueled container ship. When George III made her inaugural call to the Port of Long Beach on August 17, 2022, she was billed as the first LNG powered vessel to fuel on the West Coast and the first to serve Hawaii. Less than a year later, on July 29, 2023, Pasha Hawaii welcomed its second ‘Ohana Class vessel, MV Janet Marie. Both vessels transport cargo between Hawaii and the mainland United States. Recently, American Ship Review named MV Janet Marie Ship of the Year.

Pasha Hawaii’s parent company, The Pasha Group, is a three-generation family-owned shipping and logistics company that entered the container business in Hawaii through a 2015 acquisition that included a fleet of container ships. The acquisition, “basically doubled the company in every respect, but we knew we were going to have to eventually invest significant capital in terms of re-fleeting, as well,” said George Pasha, IV, president and CEO of The Pasha Group.

The Pasha Group team was presented with the task of constructing environmentally friendly and efficient container ships that would increase capacity and symbolize the best of American ingenuity and ship building. LNG-fueled container ships are exponentially cleaner and better for the environment than traditional cargo carriers operating on liquid oil fuels.

An international pandemic created choppy waters for financing and construction

Covid delays meant construction took significantly longer than originally anticipated. Key Equipment Finance was the lead arranger of the group syndication providing $167.5 million in financing for MV George III and $177.5 million for MV Janet Marie.

“This was a highly collaborative and structured transaction involving five investors,” said Sera Oliver, director of capital markets at Key Equipment Finance. “We entered the progress payment facility in June 2020, and due to pandemic delays, construction was completed significantly behind schedule, ultimately bringing the MV George III over the finish line with final delivery at the end of July 2022. We were very fortunate to have a strong investor group who stood by funding commitments through the environmental, social, and economic challenges. The MV Janet Mariealso saw significant delays and is successfully operating today.”

The marine industry continues to experience supply chain issues that delay the construction of new vessels, thereby increasing risk for lenders. Companies should seek a lender who has been active in marine-industry structured financing for more than two years, and one with strong industry knowledge and relationships.

“Our goal is to offer the opportunity for marine companies to procure environmentally friendly powered vessels, without over-burdening capital budgets, by aligning the financing structure to the specific application and useful life of the vessel,” said Mark Thomas, Senior Vice President, West Region Sales Director at Key Equipment Finance.

Clean and smooth sailing for MV George III and MV Janet Marie

Today, these two new Jones Act-qualified container ships are the most technologically advanced and environmentally friendly vessels to serve the Hawaii/Mainland trade lane and surpass the International Maritime Organization (IMO) 2030 emission standards for ocean vessels.

Compared to ships running on liquid oil fuels, LNG-powered cargo ships achieve a 99.9% reduction in diesel particulate matter and sulfur oxide emissions, 90% less nitrogen oxides and a 25% reduction in carbon dioxide.

“Accepting delivery of a new vessel is always a cause for celebration,” said Pasha. “To see these ships come to life, knowing they will support the needs of our customers while minimizing our environmental impact in the communities we serve, is a milestone for our team and a moment that will go down in Pasha history.”

Both vessels are named in honor of the late parents of George Pasha IV, marking three generations of service to Hawaii for the Pasha family.

In the future, Pasha has plans to retrofit an existing vessel to LNG fueling, which would be another first for the company, further increasing the energy efficiencies these cargo ships achieve.

This video demonstrates how The Pasha Group is positively affecting the environment with the company’s first LNG containership, the MV George III.