The project to build two pairs each of panamaxes and LR2/aframaxes and a set of three aframax crude tankers, will be managed by China Shipbuilding Trading Company (International), with delivery scheduled for end-2019 onwards, the company said in a stock market announcement.
Expected delivery dates for the two 64,900 dwt panamax crude tankers are on or before 29 February 2020 and 31 May 2020, respectively.
The two 109,900 dwt LR2/Aframax clean products/crude oil carriers of 109,900 dead have expected delivery dates of on or before 31 October 2020 and 31 January 2021, respectively.
Meanwhile China Shipping Energy’s three 114,000 dwt aframaxes crude oil carriers are set to be delivered over 2019 and 2020, with the first due by end-November and the remaining two by April and August 2020 respectively.
There is also the provision for penalties if certain performance benchmarks (such as speed, fuel consumption rate, tonnage) are not met, suggesting that these vessels could be based on a new design.
Giving its rationale for the move, China Shipping Energy said it was “optimistic of the demand in the import crude oil transportation market and its persistent growth in the coming years”. It added that building and owning the vessels would “enable the Group to take advantage of the business opportunities in the shipping market, enjoy economies of scale, optimize its overall route arrangements and improve its operating efficiency and profitability”.
The company plans to fund the newbuildings from internal funds, either through a restricted share issue or through other financial instruments including bank borrowings.