UPDATED: Cosco’s VLCC order just the tip of the iceberg

Dalian: The initial batch of 10 VLCCs that Cosco Dalian is negotiating is part of a 30 VLCC order, which in turn is part of a VLCC pool being planned among China’s leading state-owned shipping lines, SinoShip News can confirm. This news portal first reported the news one month ago today.

“In reality this is such a big project, all together 70-80 ships planned,” a well-placed source stressed involving Cosco, China Merchants and China Shipping.

The cash allocation for this spending is in the latest five-year plan so the orders need to be done before 2015. The dipping market has made negotiations slower than anticipated but further orders are expected to be placed in the coming six months.

“Currently we are still probing into the possibilities, nothing has been confirmed yet,” an official from Cosco’s tanker division in Dalian told SinoShip News, “and we are negotiating with many different yards in China, not only the three yards mentioned before. Also we are negotiating with some companies for potential charters,” the official added.

“We had a preliminary contact with Cosco Dalian, it still needs further negotiation,” an official at Unipec, who is close to the matter, said to Sinoship News.

Currently Cosco Dalian has 18 oil tankers and six of them are VLCCs.

Meanwhile, the gm of China Shipping Xu Lirong has told Reuters that his company is looking to contribute to the pool with a ten plus ten VLCC order. "The aim is to secure good supply, stabilize costs, form long-term cooperation and create a win-win situation," Xu told Reuters.   [21/09/12]

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