STX Offshore & Shipbuilding is returning to the market after a spate of financial difficulties and is close to clinching a series of MR tanker newbuildings in a transaction that revives a collapsed deal with Pacific Carriers Ltd (PCL).
The deal comes as the South Korean shipbuilder is actively marketing its berths after fulfilling requirements set up by its main shareholder, Korea Development Bank (KDB).
Shipbuilding sources who follow STX said the Chinhae-based shipyard is close to signing contracts for up to five 50,000-dwt product tanker newbuildings with Singapore’s PCL.
Discussions for the newbuildings between STX and PCL are at the advance stage, and they are aiming to conclude the order contract this year
“STX has sold the assets that KDB requested. They included one floating dry dock, a plot of vacant land near Chinhae shipyard, a research and development centre and a workers dormitory,” said one shipbuilding source.
“Discussions for the newbuildings between STX and PCL are at the advance stage, and they are aiming to conclude the order contract this year.”
Assets sold
An STX executive confirmed his company has fulfilled KDB’s request in selling the shipyard’s non-core assets and that it is engaged in discussions for newbuildings. However, the executive declined to comment on the PCL deal.
Shipbuilding sources said PCL is looking to book three firm vessels plus two options. The vessels would be built to IMO Tier II standards. PCL is aiming for 2020 delivery. The shipowner's chief operating officer, Hor Weng Yew, was unavailable for comment.
Should PCL firm up the MR tankers with STX, it would be its second attempt to strike a newbuilding deal with the yard.
Collapsed deal
In July, the shipowner was reported to have placed an order for three similar vessels for early 2020 delivery.
However, that transaction collapsed as KDB refused to issue refund guarantees on the grounds that STX failed to fulfil the terms of its rescue package agreed with KDB in April.
As a result, STX saw contracts quashed for up to nine MR tankers worth more than $300m. Shipping companies that were reported to have booked newbuildings there included Valles Steamship of Hong Kong and Taiwan’s Sincere Navigation.
PCL has a significant presence in the bulker sector, where it operates about 70 vessels.
As for tankers, it controls eight product carriers of less than 20,000 dwt and two MRs. PCL also operates four VLGCs and five other LPG carriers.
