Greek shipping company Performance Shipping continues to order new vessels from China to expand its fleet.
Performance Shipping Inc., a global shipping company specializing in the ownership of tanker vessels, announced that, through a separate wholly-owned subsidiary, it has signed a shipbuilding contract with Jiangsu Yangzijiang Shipbuilding Group Co., Ltd., Jiangsu New Yangzi Shipbuilding Co., Ltd., and Jiangsu Yangzi Xinfu Shipbuilding Co., Ltd., for the construction of a scrubber fitted 75,000 DWT LR1 chemical/product oil tanker for a contract price of US$54.1 million excluding extras and net of commission to third parties.
15% of the purchase price is payable upon receipt of a refund guarantee, expected to occur within 30 days; 10% of the purchase price is payable at each of the milestones of steel cutting, keel laying and launching of the vessel, and the remaining 55% of the purchase price is payable upon the vessel’s delivery. The Company expects to take delivery of the vessel by January 2027.
The vessel will be equipped with electronic main engines with high-pressure selective catalytic reactors (HPSCR) for Tier III (NOx Emissions) compliance, exhaust gas cleaning systems (EGCS – commonly referred to as scrubbers) for Tier II (NOx Emissions) compliance, and ballast water treatment systems (BWTS).
Andreas Michalopoulos, the Company’s Chief Executive Officer, stated:
“We are pleased to announce our shipbuilding contract to construct one modern eco-design LR1 tanker. This vessel will feature the latest high specification engine and emission requirements, along with a scrubber and water ballast treatment system. The construction of the vessel is undertaken by one of the most reputable and highly specialized shipyards in the world. This contract marks our fourth shipbuilding contract, including three LNG-ready LR2 oil tankers and one LR1 chemical/product oil tanker with scheduled deliveries ranging from October 2025 to January 2027.
“Our newbuilding commitments are supported by the three recently announced time charter employment contracts for our three newbuilding LR2 tankers, securing a firm period of five years, generating gross revenues of US$169.8 million and supplementing our existing revenue backlog of US$34.1 million. With our aggregate revenue backlog of US$203.9 million, representing 93% of all our remaining newbuilding capital expenditures, we are well positioned for growth.
“Our fleet expansion and renewal strategy prioritizes fuel efficiency and low emissions, reflecting our commitment to participating in the energy transition. By taking constructive steps towards lower carbon emissions, we aim to provide our customers with environmentally sustainable operations. We believe that our investment strategy aligns with our view of continuing favorable market fundamentals, supported by an aging fleet and a healthy orderbook, which currently stands at 9%.”
Performance Shipping is a global shipping company specializing in the tanker sector and currently operates its fleet on spot sailings, pooling arrangements and time charters, according to the official website. As of May 7, 2024, the company owned and operated seven Aframax tankers, as well as three newbuild LR2 product/crude oil tankers and one newbuild LR1 product tanker scheduled for delivery between October 2025 and January 2027.
In previous news, three LR2 product/crude oil tankers will be built by Shanghai Waigaoqiao Shipbuilding (SWS), a subsidiary of China State Shipbuilding Corporation (CSSC), with shipbuilding contracts signed on March 8, 2023 and December 20, 2023 for one and two units, respectively, at a cost of $62.6 million and $64.8 million per unit, respectively.
With this latest order, Performance has ordered four new vessels from Chinese shipyards in the tanker sector. A few years ago, Performance announced its shift from the container sector to the tanker sector. At the end of last year, Performance also ordered two 64,000 dwt bulk carriers from Xindayang Shipbuilding. This is the first time Performance placed an order in the bulk carrier sector, signaling that the shipping company has shown the ability to reinvent itself and potentially undergo another transformation.