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Zhejiang Satellite Petrochemical in negotiations for more VLECs at Korean yards

Zhejiang Satellite Petrochemical is currently in talks with South Korean yards for the construction of more VLECs in order to meet its ethane transportation demands from its new plant in Lianyungang.

Satellite Petrochemical currently has six 98,000 cu m VLECs under construction at Hyundai Heavy and Samsung Heavy. The company took over the ownership of the vessels from Delos last year to ensure timely delivery after Delos wasn’t able to make payments according to the newbuild contracts. Now the company is looking to sell the six vessels and charter them back.

Industry sources told Splash that the company is in talks with South Korean yards for six more 98,000 cu m VLECs, however, it will most likely sell the ownership of the vessels too and be a pure charterer.

The price of a newbuild 98,000 cu m VLEC is currently around $120m.

When contacted by Splash, an official from Satellite Petrochemical declined to comment on the matter.

Satellite Petrochemical is the largest acrylic acid producer in China. All the VLECs will be used to transport raw material from Texas to Lianyungang. The phase one project of the company’s new petrochemical plant will commence operations later this year.

The US is now the world’s only major exporter of waterborne ethane, exporting its first waterborne ethane in 2016.

Jason Jiang

Jason is one of the most prolific writers on the diverse China shipping & logistics industry and his access to the major maritime players with business in China has proved an invaluable source of exclusives. Having been working at Asia Shipping Media since inception, Jason is the chief correspondent of Splash and associate editor of Maritime CEO magazine. Previously he had written for a host of titles including Supply Chain Asia, Cargo Facts and Air Cargo Week.
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