Orient Overseas Limited, the parent company of OOCL, entered into shipbuilding contracts with the two shipbuilders. These ten new box ships will be built by Dalian COSCO KHI Ship Engineering and Nantong COSCO KHI Ship Engineering.
The contracts have a value of $1,575.80 million (HK$12,291.24 million).
The vessels under the transaction would increase the average container space per vessel of the Group, driving economies of scale, whereby a higher container space per vessel would result in a lower cost per container, enhancing the operating cost competitiveness of the Group.
These new builds will be equipped with energy saving and emission reduction technologies, which will generate cost advantages as well as help in environmental protection.
The Vessels are expected to be delivered between the fourth quarter of 2024 and the fourth quarter of 2025 subject to any early delivery or delay in delivery (subject to a maximum liquidated damages of approximately US$9.63 million per Vessel for delay in delivery payable by the relevant Builder to the relevant Buyer) as provided in each of the Shipbuilding Contracts.
The Vessels are expected to be delivered between the fourth quarter of 2024 and the fourth quarter of 2025 subject to any early delivery or delay in delivery (subject to a maximum liquidated damages of approximately US$9.63 million per Vessel for delay in delivery payable by the relevant Builder to the relevant Buyer) as provided in each of the Shipbuilding Contracts.
“The transaction is in line with the 14th Five Year Plan of the group, which would, among other things, increase the fleet capacity of the group and consolidate its position in the first echelon of the industry. The increase of self-owned vessels … would complement the group’s long term strategic development and growth plan to meet market demand in the future,” OOIL said.
“The group would also benefit from the optimization of its fleet structure and the reduction of its reliance on the vessel charter market. In addition, the vessels under the transaction would increase the average container space per vessel of the group, driving economies of scale, whereby a higher container space per vessel would result in a lower cost per container, enhancing the operating cost competitiveness of the group.”
OOIL added that the boxships will be equipped with energy-saving and emission reduction technologies, which will generate cost advantages as well as help in environmental protection.
In March 2020, OOCL ordered five 23,000 TEU units at Nantong and Dalian, slated for delivery in 2023.