Single-hull tankers remain on the market

A recent count of single-hull very large crude carrier (VLCC) tankers showed that 151 are still in use in the market, although international regulations require all these ships to be gradually withdrawn by 2010, depending on the year they were constructed. Regulations even call for the withdrawal of tankers constructed after 1982. They do allow a loophole for use beyond 2010 but not for longer than 25 years since delivery, or the year 2015, whichever comes first. Therefore, four VLCCs will be withdrawn by 2009, while another 19 will be withdrawn either due to age or due to state decisions against their use after 2010. The rest are expected to remain on the market after 2010, with their owners to decide the exact time of their withdrawal, obviously taking into account the level and the fluctuation of chartering rates and with the possible alternative solution of their modification into dry-bulk carriers. At least eight single-hull VLCCs were sold last year for modification into mineral-carrying vessels, boosting the dry-bulk carrier market, with several other ships built in the 1990s also sold for the same purpose. Given that modification costs come to about $25 million (for a 280,000-ton ship built in 1992), within 15 years and with an annual interest rate of 6.5 percent, there should be an amortization of $7,200 per day, or $17,000 per day, including operation costs, which renders this move particularly profitable. The inspection of tankers happens every five years and is very costly in terms of time and money for 15-year-old tankers. About 60 percent of single-hull VLCCs have been in use for 15 or 20 years but are overdue for their third or fourth inspection, while of the 17 VLCCs to be withdrawn in 2010, 10 will be supervised this year, which obviously renders any further use of them non-profitable. Of the 130 VLCCs available for use after 2010, 81 (62 percent) will be inspected in their 15th or 20th year before 2010, and 22 (17 percent) in 2010, with the costs primarily affecting shipowners’ decisions on their further use. Seen from another perspective, no more than 86 of the 151 VLCCs can be used until 2015, with 48 of them (56 percent) scheduled for their 15th-year inspection in 2007-2009, so their 20th-year inspection will be in 2012 to 2014. As a result, only a handful of tankers are to be withdrawn in 2015, while 120 ships are to be delivered in the 2007-2009 period, according to shipyard orders. European ports urge use of public-private partnerships Partnerships with the private sector are the solution that representatives from four major European ports proposed at the Second International Symposium held by the Thessaloniki Chamber of Commerce and Industry yesterday. Officials from the ports of Hamburg, Antwerp, Burgas and Constanta presented their development models, which focused on modern infrastructure and services of high standard, with an emphasis on containers and logistics, to meet global competition. The port of Hamburg belongs to the City of Hamburg but private companies operate it, while the port of Constanta made its volume of handled containers soar with the construction of the new container freight station in joint participation with a Japanese firm and its operation by a Dubai-based company.

Subscribe to our Newsletters

Enter your information below to receive our weekly newsletters with the latest insights, opinion pieces and current events straight to your inbox.

By signing up you are agreeing to our Terms of Service and Privacy Policy.