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Friday, 29 June 12
DRY BULK SHIP OWNERS DOING THEIR MATHS BEFORE PLACING NEWBUILDING ORDERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 With oversupply having plagued the dry bulk shipping fleet since the end of 2011, it’s become ever so evident that placing a newbuilding order is a hard decision nowadays for most ship owners, despite the fact that newbuilding prices are close to their lowest price levels in two decades. Despite this incentive, ship owners have to consider additional factors, such as financing, market conditions and of course freight rates. If they are low, then it’s hard to consider a newbuilding order, since the return on investment will most likely be low, making it more difficult to secure and ultimately paying off a bank loan to finance the newbuilding investment.
In a recent report, Intermodal, aknowledging the fact that timing is crucial in a strongly cyclical and capital intensive market, such as international shipping, examined the case of Kamsarmax dry bulk carriers. In his report, Intermodal’s Panos Tsilingiris, said that for the purpose of the exercise, Intemodal assumed that contracting takes place today and delivery is scheduled after about two years. Furthermore, “the vessel is operated is operated by the buyer for 10 full years (including her second SS/DD) and is sold thereafter. The residual sale price is the resale price of the vessel depreciated over 10 years at 5% p.a. We accept newbuilding prices of $ 26.5 million basis 30/70 payment terms plus $ 500k pre-delivery expenses. With regards to financing, we suppose 60% loan with a fixed interest rate of 5% and 25% balloon, and arrangement/commitment costs of approximately 1.5% of the loan facility. The remaining 40% is financed via equity at 12% p.a. The Opex costs begin with xs $ 6,000/day and are subject to a 2.5% annual appreciation, while we also factor in indicative dry-docking costs. Assuming 365 OPEX days and 350 TC days, the resulting break-even TC rate for the 10-year period is $ 15,959/day” said Tsilingiris.
He added that “at first sight, the above figure may not enthuse speculators when compared to the current freight market in which Kamsarmax bulkers struggle to achieve double-digit yearly TC rates. However, the seasoned shipowner will recognize that this figure is well below the 20-year average, the 10-year average, and the 10-year average after excluding the 2007-2008 bubble years.
Further to the attractive break-even point, the driving force for newbuildings is the high price of bunkers; the ‘eco-type’ designs with their promised (yet generally unproven so far) increased energy efficiency appear tempting to both owners and charterers. Owners might prefer newbuildings over second-hand tonnage since they do not expect a radical peak-up in the dry bulk freight markets during 2012-2013. Moreover, the long operating life of a newbuilding provides some encouragement, if not statistical certainty, that the market will peak up at least once during the vessel’s operating life. There is hope that due to the significantly slower recent contracting of bulker newbuildings and assuming no collapse in demand, the market will return to healthy levels within 2015. Of course, massive orders, something not expected in the short-term given the current market, the tight financing and the global economic uncertainty, would negate any benefit from the lower break-even point of such investments” he said.
As a result, the report from Intermodal concludes that “while the exact figures depend upon the idiosyncrasies of the specific project and ship-owner as well as market conditions (LIBOR, actual TC rates, residual value, etc.), we have shown how the low entrance point for newbuildings renders attractive the break-even rate of such investments. In conclusion, as low shipbuilding prices gradually concur with the maturing of eco-type designs, newbuilding investments appear increasingly attractive” it said.
Source: Nikos Roussanoglou, Hellenic Shipping
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Monday, 24 June 24
PHILIPPINES COAL SUPPLY ENOUGH UNTIL 2030 - PHILSTAR GLOBAL
The country’s existing coal-fired power plants are sufficient to ensure enough base load capacity in the next six years, Energy Secretary Rap ...
Friday, 14 June 24
NEXTDECADE, SAUDI ARAMCO SIGN 20-YEAR LNG SUPPLY DEAL - REUTERS
U.S. liquefied natural gas (LNG) provider NextDecade has signed a non-binding agreement with Saudi Aramco 2222.SE to supply 1.2 million tonnes per ...
Friday, 14 June 24
NEWBUILDING PRICES CLIMB 3% TO HIGHEST LEVEL IN 16 YEARS - NIELS RASMUSSEN
“Since the start of the year, newbuilding prices have risen 3% to their highest level since 2008. Compared to their most recent low in late 2 ...
Friday, 14 June 24
INDIA TARGETS HIGHER DOMESTIC COAL PRODUCTION, REDUCED IMPORTS: GOVT - REUTERS
India wants to reduce coal imports and increase domestic production, federal coal minister G. Kishan Reddy said on Thursday.
The cou ...
Thursday, 13 June 24
US LNG TO ASIA FOR POWER GENERATION EXPECTED TO CUT EMISSIONS VERSUS COAL - RYSTAD ENERGY
The value-chain emissions of liquified natural gas (LNG) are lower on average than for coal-fired power generation, even when the fuel is shipp ...
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- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Anglo American - United Kingdom
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- Indogreen Group - Indonesia
- Minerals Council of Australia
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Edison Trading Spa - Italy
- Maheswari Brothers Coal Limited - India
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- GAC Shipping (India) Pvt Ltd
- OPG Power Generation Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- Intertek Mineral Services - Indonesia
- Coastal Gujarat Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Agrawal Coal Company - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bharathi Cement Corporation - India
- Interocean Group of Companies - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Borneo Indobara - Indonesia
- Mintek Dendrill Indonesia
- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- The Treasury - Australian Government
- Trasteel International SA, Italy
- Meenaskhi Energy Private Limited - India
- Makarim & Taira - Indonesia
- Indian Oil Corporation Limited
- Independent Power Producers Association of India
- London Commodity Brokers - England
- SN Aboitiz Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- International Coal Ventures Pvt Ltd - India
- Grasim Industreis Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Holcim Trading Pte Ltd - Singapore
- Sarangani Energy Corporation, Philippines
- Australian Coal Association
- Ministry of Finance - Indonesia
- Straits Asia Resources Limited - Singapore
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Carbofer General Trading SA - India
- Altura Mining Limited, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- ASAPP Information Group - India
- Wilmar Investment Holdings
- Commonwealth Bank - Australia
- San Jose City I Power Corp, Philippines
- Madhucon Powers Ltd - India
- New Zealand Coal & Carbon
- Sojitz Corporation - Japan
- Rashtriya Ispat Nigam Limited - India
- Savvy Resources Ltd - HongKong
- Jindal Steel & Power Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- Ceylon Electricity Board - Sri Lanka
- VISA Power Limited - India
- Essar Steel Hazira Ltd - India
- Ambuja Cements Ltd - India
- Kaltim Prima Coal - Indonesia
- Videocon Industries ltd - India
- Coalindo Energy - Indonesia
- The University of Queensland
- Heidelberg Cement - Germany
- Larsen & Toubro Limited - India
- Leighton Contractors Pty Ltd - Australia
- Marubeni Corporation - India
- Global Coal Blending Company Limited - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Attock Cement Pakistan Limited
- Goldman Sachs - Singapore
- Toyota Tsusho Corporation, Japan
- Bangladesh Power Developement Board
- Banpu Public Company Limited - Thailand
- Electricity Authority, New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Electricity Authority - India
- PetroVietnam Power Coal Import and Supply Company
- Indika Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Miang Besar Coal Terminal - Indonesia
- Kumho Petrochemical, South Korea
- Mjunction Services Limited - India
- Eastern Energy - Thailand
- Alfred C Toepfer International GmbH - Germany
- Directorate Of Revenue Intelligence - India
- Parliament of New Zealand
- Vedanta Resources Plc - India
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Siam City Cement - Thailand
- Romanian Commodities Exchange
- Ministry of Mines - Canada
- Pendopo Energi Batubara - Indonesia
- ICICI Bank Limited - India
- Simpson Spence & Young - Indonesia
- Oldendorff Carriers - Singapore
- PNOC Exploration Corporation - Philippines
- Tata Chemicals Ltd - India
- South Luzon Thermal Energy Corporation
- Manunggal Multi Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Meralco Power Generation, Philippines
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Latin American Coal - Colombia
- Merrill Lynch Commodities Europe
- Malabar Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Mercator Lines Limited - India
- Wood Mackenzie - Singapore
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Sakthi Sugars Limited - India
- Antam Resourcindo - Indonesia
- IHS Mccloskey Coal Group - USA
- Bhatia International Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Therma Luzon, Inc, Philippines
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- Economic Council, Georgia
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- IEA Clean Coal Centre - UK
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Port Waratah Coal Services - Australia
- Gujarat Mineral Development Corp Ltd - India
- Rio Tinto Coal - Australia
- Planning Commission, India
- MS Steel International - UAE
- Kideco Jaya Agung - Indonesia
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- White Energy Company Limited
- Thiess Contractors Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Formosa Plastics Group - Taiwan
- Thai Mozambique Logistica
- PTC India Limited - India
- Ind-Barath Power Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- Ministry of Transport, Egypt
- Australian Commodity Traders Exchange
- Electricity Generating Authority of Thailand
- PowerSource Philippines DevCo
- Standard Chartered Bank - UAE
- Aditya Birla Group - India
- Kartika Selabumi Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Medco Energi Mining Internasional
- Karaikal Port Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Jaiprakash Power Ventures ltd
- India Bulls Power Limited - India
- Georgia Ports Authority, United States
- Bukit Makmur.PT - Indonesia
- Globalindo Alam Lestari - Indonesia
- LBH Netherlands Bv - Netherlands
- Central Java Power - Indonesia
- Bayan Resources Tbk. - Indonesia
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- Bhushan Steel Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Parry Sugars Refinery, India
- Baramulti Group, Indonesia
- Bulk Trading Sa - Switzerland
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- Semirara Mining Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Vijayanagar Sugar Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Lanco Infratech Ltd - India
- Bhoruka Overseas - Indonesia
- Price Waterhouse Coopers - Russia
- GMR Energy Limited - India
- Billiton Holdings Pty Ltd - Australia
- Power Finance Corporation Ltd., India
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Uttam Galva Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- GN Power Mariveles Coal Plant, Philippines
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