Month: November 2015

German shipping company F.Laeisz GmbH has signed a financial agreement in Beijing with Chinese multinational banking company Industrial and Commercial Bank of China Ltd. (ICBC). Under the agreement, ICBC will provide USD 65 million worth of buyer’s credit to F.Laeisz GmbH for two vehicle roll-on/roll-off ships under construction at Chinese shipyard COSCO Dalian Shipbuilding. The deal comes following the last month’s signing of a financial deal with yet another German shipping company Peter Döhle, also intended for financing ship construction. F.Laeisz GmbH has eight car carriers in its fleet featuring 11,760 DWT in capacity. The company operates a fleet of about 40 vessels, boasting over 1.7 million DWT in total. Aside from car carriers, the company’s fleet includes container ships, bulk carriers, gas carriers and research vessels.

The Chinese government has issued a list of companies involved in offshore shipbuilding that made it to the so called “White List”, local media report.

The companies that make it to the list have a better chance of receiving financial loans from Chinese banks.

In the first batch, the country’s Ministry of Industry and Information Technology (MIIT) selected seven shipyards, all state-owned, those being: CIMC Raffles, China Merchants Heavy Industry, Cosco Qidong Shipyard, Shanghai Waigaoqiao Shipbuilding, Shanghai Zhenhua Heavy Industries Company, Dalian Shipbuilding Industry Offshore, and Cosco Nantong Shipyard.

The announcement follows a period of revision of the shipbuilders’ applications that was launched in July this year.

Previously, the Chinese government said that the list would aim at consolidation of offshore businesses, along with encouraging of technological progress and innovation. The specific benefits that offshore shipyards that make it to the list would enjoy are yet to be disclosed.

The list is similar to that of China’s “White List” of conventional shipyards that were made eligible for restructuring within China’s reform of the sector aimed at boosting competitiveness by cutting overcapacity.

The ‘White List’ was announced in 2014 by China’s government, as an additional incentive for shipyards which comply with the country’s requirements in areas such as ship emissions, offering the rule-abiding shipyards benefits such as tax rebates and bank credits.

A devastating offshore market is expected to impact UK-based developer and producer of marine engines Rolls-Royce harder than expected in 2016.

In the guidance for 2015, the company announced that its marine performance continued to be impacted by weakening offshore markets and continued deferment or cancellation of orders. The company expects a further 15-20% decline in offshore marine market demand, weakening marine profit by a further USD 113-152 million.

The profit headwinds are likely to reach around USD 987.3 million in 2016, compared to 2015. Many of the headwinds impact higher than average margin segments of the business, or businesses where fixed costs are relatively high, the company said.

“While 2015 remains broadly as expected, the outlook for 2016 is very challenging. The speed and magnitude of change in some of our markets, which have historically performed well, has been significant and shows how sensitive parts of our business are to market conditions in the short-term,” Chief Executive Warren East said.

The company updated its outlook saying that they expect a revenue of up to USD 2,505 million for its marine business in 2015, compared to USD 2,202 million in 2014. Profit for this section is expected to be at USD 60.7 million.

As informed, Land & Sea progress was in line with full year expectations, although weakness in the offshore market continues to adversely impact the business. As a result, while expectations for the full year remain unchanged, the risk of further deterioration remains high in 2016.

Although many Land & Sea businesses had good order intake in the quarter, the offshore business intake was very weak. New contracts included MT30 gas turbines for the Royal Navy’s Type 26 Global Combat Ship, MTU diesel engines for the refit of the Royal Navy’s fleet of Type 23 Frigates and a new agreement for the supply of engines for a range of Sunseeker luxury yachts.

Rolls-Royce added that since the end of the quarter they have announced a further restructuring program within their marine business. This will focus on reducing corporate and administrative costs, including a 400 reduction in headcount – in addition to the 600 announced in June – with most of the early savings being reinvested in increased R&D to strengthen the competitive position of the business.

US liquefied gas shipping company Navigator Holdings has entered into a long term charter for a midsize gas carrier.

Navigator said that it will enter into a construction contract for this fully-refrigerated LPG vessel with Hyundai Mipo Shipyard in South Korea. The ship should join the company’s fleet in August 2017. The company’s second midsize ethane carrier will front-run the contract until delivery of the newbuild.

In its financial results for the third quarter of 2015, Navigator reported a revenue of USD 78.2 million, and net income of USD 22.7 million. The company’s EBITDA increased to USD 44 million, notwithstanding Navigator Aries being out of service following her collision in June 2015, and the sale of Navigator Mariner.

During the quarter, the company took delivery of a further newbuilding vessel, Navigator Centauri, and since the quarter end Navigator Ceres joined the fleet.

Navigator has an existing order book of 8 semi-refrigerated gas carrier newbuildings, for delivery between January 2016 and March 2017.

Ulstein’s largest offshore construction vessel yet, yard number 302, named Island Venture, has entered the final stage of her sea trials.

Island Venture, being built by Norwegian shipbuilder Ulstein Verft for Island Offshore/Edison Chouest Offshore, has been thoroughly tested at sea trials this week, and after the final tests are finished, the vessel will return to the yard by the end of the week to be completed.

“The sea trial has so far gone as expected. Some challenges will always emerge on sea trials, but we are now well underway with the DP tuning. With hard work, further testing and class punch towards the delivery, we will manage to complete our mission. 

“This is the largest ship and one of the most advanced projects so far. I believe we will manage to deliver this time as well thanks to our dedicated employees and suppliers that are currently working night and day to complete the vessel,” Ulstein Verft’s project manager Per Svein Brekke said.

Expected to be delivered in Q4 2015, the Island Venture is an SX165 design developed by Ulstein Design & Solutions. The vessel was launched from Ulstein’s dock hall on August 25, 2015.