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| Published：2021.02.21 News Sources：Qingdao Gute Ship Supplies Co., Ltd. Views： | |||
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Chinese shipyard big order to come! Iron ore giant wants to build 10 LNG-powered bulk carriers
FortesmG is bidding for lease of five + five 209,000 DWT dual-fuel bulk carriers worth up to $700 million and is asking owners to quote charter rates for five to 10 years, according to sources. Several shipping companies, including several Chinese leasing companies, China Merchants Shipping Co., Taiwan's Yumin Shipping Co., and Japan's Mitsui Merchant Shipping Co., are interested in FormG's tender. FormG chose to order the 209,000 DWT wide body shallow draft bulk carrier because it is more flexible than the 260,000 DWT Very Large Ore Carrier (VLOC) it chartered years ago, industry sources said. With the new NewcastleMax, FormG can ship iron ore to either China or Japan. FormG did not specify what type of engine would be installed on the ship. However, industry insiders believe that such LNG-powered bulk carriers could cost as much as $68 million each with a low-pressure WINGD engine. With MAN Energy Solutions' high-pressure ME-GI engine, the cost increases to $70 million per vessel. FormG is the third major mining company to enter the LNG-powered ship market. Last year, BHP Billiton and Singaporean ship management company Eastern Pacific Shipping (EPS) signed a lease for five 209,000 DWT LNG-powered NewcastleMax bulk carriers to be built by Waigaoqiao and New Era, including two and three. Separately, multinational mining company Anglo American in November placed an order for the first four LNG-powered 190,000 DWT Capesize bulk carriers to be built at Waigaoqiao Shipbuilding by Yu Ming Shipping. It is worth noting that FortesmG has been actively promoting the use of LNG-powered bulk carriers. In 2017, just after worked with BHP billiton, Rio tinto group, mitsui osk, he shipping, Woodside Energy, Shanghai ship design institute and DNV GL partners such as the "Green Corridor (Green Corridor)" joint industry project, decided to build LNG power bulk carrier, Australia to China routes for iron ore and coal transportation. 
FortesmG is the third largest iron ore company in Australia and the fourth largest in the world, exporting about 170 million to 175 million tons of iron ore annually. Fortescue sells most of its iron ore to China, which now accounts for 93% of its sales. More than 880 million tons of iron ore have been exported to China so far. FormG recently secured about $4 billion in iron ore deals at the China International Import Expo in Shanghai. Trade in Australia's most important export, iron ore, has not been affected by rising diplomatic tensions between the two countries. The company currently operates eight 260,000-dwt VLOC vessels leased from the Bank of China for 12 years. The eight VLOC's were all built by Yangzijiang Shipbuilding and delivered in succession between 2016 and 2018. FormG recently announced its results for the six months ended December 31, 2020 (the first half of fiscal 2021). Fortescue's performance in the first half of fiscal 2021 was excellent. Fortescue reported sales of $9.3 billion in the first half of its fiscal year, up 44% from a year earlier. Preliminary net profit after tax for the six months ended December 31, 2020 was $4 billion to $4.1 billion. The company has strong cash flow, with $4 billion in cash, and only $100 million in net debt. Based on strong first-half results and continued efforts to eliminate bottlenecks and optimize capacity, FormG has raised its FY2021 shipment guidance to between 178 million and 182 million tons. |
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