COSCO Shipping Energy Transportation Orders Tanker Duo at DACKS

COSCO Shipping Energy Transportation Orders Tanker Duo at DACKSzoomImage Courtesy: COSCO

COSCO Shipping Energy Transportation has ordered two 308,000 dwt tankers from compatriot Dalian COSCO KHI Ship Engineering Co (DACKS), a subsidiary of COSCO Shipping.

The Hong Kong-listed company said the value of the deal is USD 160 million and that the construction of the new ships will be financed predominantly by bank loans.

Specifically, approximately 70 percent of the price will be covered by bank borrowings and approximately 30 pct of the price by internal financial resources, the shipping company said in a regulatory filing.

The ships are slated for delivery in August 2020 and January 2021 respectively.

The rationale behind the order is the expectation of the company’s directors that the demand in the import crude oil transportation market will pick up and continue growing in the coming years.

The directors are of the view that the construction and ownership of the tankers will enable the group to take advantage of the business opportunities in the shipping market, enjoy economies of scale, optimize its overall route arrangements and improve its operating efficiency and profitability,” the filing reads.

The transaction is yet to be approved by the shareholders at an extraordinary general meeting scheduled for January 22.