Odfjell “Most Likely” to Cancel Five LPG Vessels

Image Courtesy: Odfjell

As the construction of its newbuildings continues to be substantially delayed, Bergen-based shipping and tank terminal company Odfjell SE said that it “will most likely” cancel the remaining five liquefied petroleum gas (LPG) carriers it has on order in China.

In late September, the company cancelled three of the newbuilding contracts. All instalments, including accrued interest, for the cancelled vessels have been refunded from the guarantor, according to Odfjell.

Instalments paid on the remaining orders are secured by refund guarantees from reputable financing institutions.

The company recently signed contracts for the construction of four 49,000 dwt stainless steel chemical tankers at China Shipbuilding Trading and Hudong-Zhonghua Shipbuilding.

The first newbuilding is expected to be delivered in June 2019 and the following vessels would join their owner with 3-month intervals.

Although the downward trend in freight rates continued through the third quarter with reduced spot rates in most markets, the company managed to soften the impact of the weaker market through contract nominations and efficient allocation of its fleet.

During the third quarter ended September 30, 2016, Odfjell’s net income stood at USD 16 million, up from USD 7 million seen in the same quarter a year earlier.

The company’s revenue for the period dropped to USD 240 million from USD 276 million reported in the same quarter of 2015.

“Our markets continue to be challenging, but we continue to see improvements in our competitiveness, which softens the impact on the Odfjell results. The sale of the Oman terminal at an attractive valuation shows some of the underlying value in our terminal business,” Kristian Mørch, CEO of Odfjell SE, said.

As the spot chemical market is under pressure and rates are still softening, while the CPP market continues to be depressed, Odfjell has forecast that its fourth quarter time charter result would be below the third quarter’s amid generally softer markets.

Share this article

Follow World Maritime News

In Depth>

Events>

<< Jun 2017 >>
MTWTFSS
29 30 31 1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30 1 2

DSM17

Donsö Shipping Meet 2017 is an all inclusive exhibition. Meals, electricity, meeting schedule and banquette dinner is included…

read more >

TOC Europe

TOC (The Terminal Operations Conference) has long been considered best in class by container terminal operators and their suppliers…

read more >

Marine Philippines 2017

The 4th edition of PHILIPPINES MARINE 2017, SHIPBUILD PHILIPPINES 2017 and OFFSHORE PHILIPPINES 2017 is the only specialized Shipbuilding…

read more >

Bunkering Week 2017

IBC’s biennial Bunkering Week is back with its successful series of 3 co-located events: 8th Bunkering in Asia, 4th LNG Bunkering and EMTECH: Ship Emissions Technology Conference.

With a proven track record of bringing together top decision makers from various industry sectors, this remains the go to event for ship owners, fuel suppliers, traders and technology solution providers. Get in-depth and detailed market insights from experts who are taking the decisions, assess peer strategies and give shape to your own in this unrivalled gathering of shipping and marine fuel industry leaders.

Key Highlights for 2017:

* 3 Co-located Conferences

* 12+ Hours of Networking Time

* In-depth Review of Shipping Markets by Segment

* Ship Owner Positions on Emissions Compliance Scenarios

* Pricing Differentials and Availability across Different Fuels

* Technology and Analytics in Fuel Management and Emissions MRV

More info

read more >