China’s Shanghai North Sea Shipping has exercised an option for a shuttle tanker at Dalian Shipbuilding Industry Co (DSIC).
An executive at the shipyard confirmed the order, but would not comment on pricing terms.
Sources within the Chinese shipbuilding sector told TradeWinds that Shanghai North Sea is likely to be paying a higher price than it did when it signed up for the first shuttle tanker in late 2020.
“For option ships, owner and shipyards usually allow some leeway for a price change,” a shipbuilding player said. “Shipyards have been hit by the hike on steel plate costs and they will seek a price increase for option vessels.”
The cost of Chinese steel plate has increased from CNY 4,000 at the end of last year to CNY 6,400 ($990) now, according to a shipyard manager.
Steel accounts for about 25% to 30% of shipbuilding costs.
It is scheduled to take delivery of the 155,000-dwt ship in late 2023.
The shuttle tanker that Shanghai North Sea ordered last year is slated for delivery in the first half of 2023. The order was the first of the type placed at DSIC in 31 years.
The two shuttle tankers were ordered for China National Offshore Oil Corp (CNOOC)'s oilfield project in Brazil.
Neither will be fitted with scrubbers, and will be powered by conventional marine fuels.
Shanghai North Sea, which was established in 1994, is a tanker joint venture between CNOOC, Sinochem International Trading, the listed arm of Chinese refining major Sinochem, Cosco and Hong Kong-based investment company Silverbond Overseas.
The outfit recently took delivery of the 15,000-dwt shuttle tanker Beihai Xin Xi Wan (built 2021) from Cosco Heavy Industry’s Qidong yard.
According to Clarksons' Shipping Intelligence Network, Shanghai North Sea has a fleet of 13 vessels that comprises three aframax tankers, three shuttle tankers, six LR1s and a floating storage and offloading unit.
DSIC is a state-owned shipyard that is under the control of China State Shipbuilding Corp. The shipyard is slated to deliver its first LNG-fuelled VLCC newbuilding to Cosco Shipping Energy Transportation (CSET) in September.
The 319,000-dwt crude carrier will have two 3,500-cbm type C bunker tanks fitted in front of the accommodation block.
