With the gradual recovery of the tanker market, Dalian Shipbuilding Industry Corporation (DSIC), a subsidiary of China State Shipbuilding Corporation (CSSC), has once again won the favor of its regular customers for its main ship, the Very Large Crude Carrier (VLCC).
According to Trade Winds, Seatankers Management, a subsidiary of Norwegian shipowner John Fredriksen, has announced the exercise of an option on two 307,000 dwt conventional fueled VLCCs to DSIC.
With the optional VLCCs taking effect, the number of 307,000 dwt conventional fueled VLCCs ordered by Seatankers Management at the shipyard has increased to eight, with delivery of all the newbuildings expected to begin in 2026. This VLCC cost about $116 million each, and the total value of the eight new VLCCs is $928 million (RMB 6.715 billion), according to previous news.
Seatankers Management first announced the order of conventional fuel VLCCs from DSIC in January this year, and on February 6, China Shipbuilding Heavy Industry Corporation (CSIC) announced that DSIC had signed orders for 6+2 conventional fueled VLCCs and 4+2 liquefied natural gas (LNG)-powered dual-fuel VLCCs with two renowned European shipowners, respectively. The first batch of 10 VLCCs will be effective from the time of signing.
Although DSIC has not disclosed the two European shipowners, industry sources indicate that the orders are from Seatankers Management, owned by Norwegian king John Fredriksen, and Capital Maritime & Trading (Capital) of Greece, owned by Greek king Evangelos Marinakis.
Before Seatankers Management announced the exercise of the option, Capital’s 2 LNG dual-fuel VLCC options had come into force earlier and were contracted to be built by DSIC during the Posidonia Athens 2024. According to previous news, the cost of a single unit is about $140 million, and the total value of the 6 new shipbuildings is $840 million (about RMB 6.078 billion). This means that the total value of DSIC’s 2 types and 14 VLCC newbuildings reaches $1.768 billion (about RMB 12.796 billion).
Dalian Shipbuilding said that the conventional fuel VLCCs will be equipped with desulphurization devices, meet the International Maritime Organization (IMO) Tier III emission standards and the third phase of the Ship Energy Efficiency Design Index (EEDI) requirements, reaching the world’s advanced level of the same VLCCs in terms of overall performance, environmental performance and reliability, etc. The LNG dual-fuel powered VLCCs are equipped with ME-GI high-pressure dual-fuel power engines, which can reduce carbon emissions by 20% compared to conventional fuels. Both VLCCs are optimized and upgraded ultra-large tankers tailor-made by DSIC for ship owners.
Regarding the exercise of the VLCCs, John Fredriksen said, “With the current tanker order book at an all-time high and the global economy still dependent on oil, 2024 ‘may be the beginning of a multi-year recovery cycle for tankers.’ ”
Clarkson data shows that the current global handheld order book for VLCCs is 65 units, or about 7% of the existing fleet, with 47 units of them placed in 2024, mainly from well-known tanker owners such as Dynacom Tankers, Ray Carriers, DHT Holdings, Magni Partners, Mercuria, Assyad Shipping and Capital, among other well-known tanker owners.
