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"K" Line bags $2bn Indian coal contract

"K" Line bags $2bn Indian coal contract

Tokyo: Leading shipping line Kawasaki Kisen Kaisha has signed an en bloc deal of consecutive voyage charter (CVC) contracts to carry coal for JSW Steel and JSW Energy for a period of 10 years. The two Mumbai-based companies are a part of the O.P. Jindal Group.

The deal would see the Japanese liner use 10 vessels to transport up to 12m tonnes of coaking/steaming coal per annum to India from Australia, Indonesia, South Africa and China by 2015. The dedicated fleet will consist of two Panamax vessels phased in between 2008-09, three Post-Panamax vessels phased in from 2012-2014 and five Capesize vessels from 2011-2014. Freight revenue from the ships is expected to be over $200m per year.

The new vessels supplement existing CVC contracts for one Panamax and two Post-Panamax vessels currently supplying the Indian companies with coal. Thus, when the newly chartered vessels come into play, "K" Line will transport 15m tones per annum for the companies by 2015 - more than 40% of the total volume of coal to be imported by the two companies.

In a statement, "K" Line said, that JSW Steel Limited, which produces 4.5m tonnes of crude steel per year, is set to expand its existing steel mill in Vijayanagar and build two additional steel mills in Jharkhand and West Bengal. It added that energy generator JSW Energy also has aggressive plans to expand its capacity to 15,000MW (including coal thermal plants and hydropower plants).  [18/03/08]