China Merchants to order VLCC quartet

The vessels are priced at $85m each, suggesting the orders will be placed at Chinese yards. By the end of September, China Merchants Energy Shipping owned 52 very large crude carriers in operation and had one unit on order.

News ID: 80451

Date: 11 November 2019 - 15:40

Newbuilding plan wins China Merchants Energy Shipping board approval, with the contract to be signed ‘in due course’.

CHINA Merchants Energy Shipping, the tanker and dry bulker unit of state conglomerate China Merchants Group, is to order four very large crude carriers worth about $340m.

The proposal has won board approval, while the shipbuilding contract will be signed “in due course”, the Shanghai-listed company said in an exchange filing.

The designation of yards and schedule of deliveries were not disclosed. But the price tag of up to $85m per ship suggested the orders will be placed in China.

CMES owns 53 VLCC in operation, having just taken delivery of the most recent unit on order from Dalian Shipbuilding Industry on Friday.

With a total fleet of about 200 ships, which also includes many dry bulkers and liquefied natural gas carriers, the company recorded Yuan722.6m ($103.2) net profits in the first three quarters of 2019, up 64.3% from the same period a year ago.

It is undertaking a private offering that aims to raise up to Yuan4.1bn by selling new shares. The proceeds will be used to refinance the newbuildings ordered previously and repay debts.