Tag: VLCC

Traders describe the move as 'rare' BP is aiming to send two million barrels of North Sea Forties, the crude which usually sets the dated Brent oil benchmark, to Asia in a rare move, oil trading sources said on Wednesday.The company is sending a very large crude carrier (VLCC) with 2 million barrels of the distillate-rich crude to South Korea, according to the sources.The vessel is expected to load between December 15-20.The value of Forties has risen over the past week to a 43-cent premium to dated Brent on Tuesday, up from a discount last Thursday, in what traders said was partly a result of BP demand for the grade. BP declined to comment.Although the arbitrage to Asia is not unprecedented, traders describe the move as "rare.""It is very unusual," a North Sea crude trader said. "Last time it happened was in 2008."The move follows a free trade agreement between the European Union and South Korea, which became operational on July 1.According to the EU's website, import duties have been eliminated on nearly all goods and services under the deal.Market players said they expected companies to move to capture the reduction in tariffs going forward, which could further support Forties ...

Cooperation between SCF Group and CNPC An official steel cutting ceremony, marking the start of construction of the first of two VLCC (Very Large Crude Carrier) tankers ordered by SCF Group, took place in China on 14 November 2011.The ceremony was held at Bohai Shipbuilding Heavy Industry Co. and was attended by Sergey Popravko, Sovcomflot Senior Vice-President; Igor Tonkovidov, President of Novoship; representatives from the yard and Chinese partners.SCF is one of the world leaders in the product tanker segment, as well the Aframax and Suezmax oil tankers segments. Now the company is entering the segment of the largest ships, namely the VLCC class (more than 300,000 dwt tonnes), as stipulated by SCF's current development strategy.Both the VLCC tankers under construction will be operated under time-charter contracts, for the transportation of crude oil, signed last December with the Chinese company PetroChina International (a subsidiary of the Chinese national oil and gas corporation - CNPC). The agreements stipulate the transportation of oil by SCF vessels from the countries of the Middle East, Western Africa, and Venezuela to China.The first vessel is expected to be accepted for operation in the fourth quarter of 2012. Technical management of the tankers, including supervision of ...

Says aims to grow fleet without adding capacity Maersk Tankers, the tanker shipping unit of Danish shipping and oil group A.P. Moller-Maersk, said on Monday it would lease two vessels from Korean shipping management company Cido Shipping.The two very-large crude carriers (VLCC) would be taken on long-term bare boat and would be delivered from Universal Shipyard in Japan in November and December 2011, Maersk Tankers said.When taking vessels on long term bare boat, the company leases the vessels without crew."It is Maersk Tankers' ambition to grow in the VLCC segment and become industry leaders, without adding to capacity," said Head of Crude Claus Gronborg. "Securing existing high quality and fuel efficient vessels when the timing is right is a part of the plan."Gronborg also said cooperation with other owners through pooling of vessels or other forms of partnerships was of interest to the company.Source: Reuters

VLCC rates still struggling below operating cost level A glut of vessels and softening oil demand are set to deepen an earnings slump in the Middle East crude tanker market, with little hope of a major recovery in rates in the coming months, analysts say.Industry association INTERTANKO warned last week that the sustainability of the industry was under threat if earnings remained below operating cost levels for an extended period.Average earnings for very large crude carriers (VLCCs) on the benchmark Middle East Gulf to Japan route have hit record lows in recent months, deepening profitability concerns."The current VLCC market is in dire straits," said Peter Sand, chief shipping analyst with ship association BIMCO."Demand has been positive, with a record of fixtures, but the fundamental imbalance is handing the negotiation power over to charterers as available vessels outnumber available cargoes."The International Energy Agency said on Wednesday world oil consumption would grow less quickly than expected this year and next as the pace of economic growth slows. OPEC also downgraded its global demand outlook the same day."In order to reverse the sluggish earnings going forward, owners either have to start larger scale slow-steaming or initiate widespread idling/laying up of vessels," Sand said.Average ...

MAN Diesel & Turbo's new 7G80ME-C9.2 type diesel engines Athens-based shipmanagement concern Almi Tankers will be the first to fit MAN Diesel & Turbo's new 7G80ME-C9.2 type diesel engines on two of its newbuilding VLCCs.The engines will be built by Hyundai Heavy Industries in South Korea with test bed running scheduled for January 2013. The vessels will be built at DSME, with delivery due in May and December 2013 respectively.MAN Diesel & Turbo said that it is also currently involved in several, active VLCC projects where the G80ME-C9.2 is the preferred engine choice. This vessel type was originally the primary target behind the introduction of the G80ME-C9.2 engine, the company explained.The shipping industry is currently debating whether, or not, a VLCC service speed should be reduced to 13 knots from the existing 15 to 15.5 knots, a scenario which the G80 is tailor-made to meet, MAN claimed.Ole Grøne, MAN's senior vice president low-speed promotion & sales said: "Traditionally, super long-stroke S-type engines, with relatively low engine speeds, have been applied as prime movers in tankers. Following the efficiency optimisation trends in the market, the possibility of using even larger propellers has been thoroughly evaluated with a view to using engines ...

The largest BWT systems operating on board VLCCs anywhere in the world NEI Treatment Systems, has commissioned, during sea trials, the world's highest capacity ballast water treatment system.In July 2011, a 6,350 cu m per hour Venturi Oxygen StrippingTM (VOSTM) BWTS was commissioned during sea trials on a VLCC built by Hyundai Samho Heavy Industries (HSHI) for Samco Shipholding of Singapore.The ballast water treatment results were verified by ABS, the Marshall Islands registry, the shipyard and the shipowner.The VOS-6000 BWTS was manufactured and supplied by NEI licensee Samgong VOS of South Korea and was the first of four BWTS to be fitted by Samgong on board four 318,000 dwt Samco VLCCs being built at HSHI.The installation and commissioning of the VOS-6000 was accomplished on schedule and to the quality standards of HSHI.NEI CEO Jon Slangerup said: "This is another key milestone for NEI's VOSTM System and for Samgong, our licensee and strategic partner in South Korea. This puts to rest the question of whether or not there is commercial technology capable and certified to handle the BWTS capacity requirements of the world's largest ships.NEI, Samgong, and our Japanese licensee Mitsubishi Kakoki Kaisha, working as a team, have built and installed ...

'The Middle East Gulf market is moving slowly Rates for oil tankers on key Asian freight routes are seen steady to lower over the next week as freight demand declines due to IEA's stock release and slower bookings for naphtha shipments, shipbrokers said on Tuesday.Rates on the benchmark Very Large Crude Carrier (VLCC) export route from the Middle East to Japan slipped to a two-month low of W49.03 from W49.08 last week on limited activity.''The Middle East Gulf market is moving slowly and there seems to be no sign of any light at the end of the tunnel,'' said broker firm ICAP.The dirty tanker market has steadied near 2011 lows following the IEA's announcement in mid-June that its members would release up to 60 million barrels from its emergency stocks.IEA's surprise action has pressured freight rates as oil consuming nations were likely to rely less on imports following the release of their reserves.''While we expect tanker market conditions to improve by the end of 2011, our expectations for a recovery in the tanker market have been both delayed and reduced as a result of the IEA's decision,'' said Douglas Mavrinac, analyst with Jefferies & Company.''IEA interference creates significant uncertainty for ...

New G80ME-C9.2 main engine Leading engine manufacturer MAN Diesel & Turbo is currently involved in several VLCC projects, which involve its new G80ME-C9.2 main engine.VLCCs were originally the primary target behind the introduction of the new prime mover, MAN said.The shipping industry is currently debating whether or not VLCC service speed should be reduced to 13 knots from the existing 15 to 15.5 knots, a scenario which the G80 is tailor-made to meet, the company claimed.Ole Grøne, MAN's senior vice president low-speed promotion & sales said: "We are delighted with the market response to the G-type. We viewed its introduction as both viable and timely and are pleased that the market has seen fit to back this up."The G-type programme was introduced to the market in October 2010 with the G80ME-C9 model. MAN subsequently expanded the ultra-long-stroke programme in May 2011 with the addition of G70ME-C9, G60ME-C9 and G50ME-B9 models.The G-types have designs that follow the principles of the large-bore Mk-9 engine series that the company introduced in 2006. Their longer stroke reduces engine speed, thereby paving the way for ship designs with unprecedented high-efficiency, MAN said.Tankers have traditionally used MAN B&W S-type engines with their long stroke and low ...

The tanker industry is at the start of a 5-year downturn Frontline owner, the Norwegian-born John Fredrikson noted that leasing their ships to oil companies is currently facing a weak market and forces the company to become more passive, and possibly even sell assets, including vessels.The tanker industry is at the start of a 5-year downturn, according to Tor Olav Troeim, who is a director at Frontline and several other companies at a conference near Oslo on Tuesday.According to the Baltic Exchange, VLCCs that reaped $177,036 a day in 2008 were last at $8,900. These vessels would need $29,700 a day in order to simply break even for Frontline.Frontline will pay a dividend of 10 cents a share for the first quarter after net profit dropped from over $79 million to $15.5 million in one year, as released in a statement.In a statement released by Frontline, the board explained the low results from the first quarter, seem to be extending well into the second quarter and makes for a grim projector of the quarters to come. The board doesnt see a turnaround for the tanker market in the near future, as they believe the supply of ships is growing more ...