35 LPG Vessels Heading for Scrapping in Next Two Years
The liquefied petroleum gas (LPG) shipping market has been under a considerable pressure over the past two years, especially due to the rampant delivery of new ships in 2016.
Speaking of the current orderbook that is lined up and market balance between supply and demand during a Capital Link webinar, Dorian LPG CEO, John Lycouris, said that he was worried about the ordering spree as so many ships are scheduled for delivery in 2019 and 2020.
A substantial amount of new tonnage has been amassed, according to Lycouris, with the orderbook standing at almost 12 percent of the fleet.
However, some ease is expected to be provided by the scrapping of older ships.
“There are indeed 35 ships ready for scrapping in next two years that are going to be put out of the picture no matter what,” he added.
The market is going to be balanced, probably only because of the additional supply of product coming in and more demand in the East for LPG, Lycouris explained.
With regard to the potential ordering of small pressurized LPG carriers, CEO of Epic Gas, Charles Maltby, said that the pricing of newbuildings in the sector is not compelling at the moment. Hence, it is not expected that many owners would be tempted to order new tonnage.
When asked about the new regulations coming into effect soon such as the Ballast Water Treatment Convention, IMO Tier III and the 2020 sulfur cap, Maltby said that no pressurized LPG vessel has been ordered which features duel-fuel engine capability so far.
“Some shipyards have designs available and are in discussions with various potential buyers, but nothing has actually been done. It doesn’t look like something we are going to be at the forefront of when it comes to implementation,” he added.
World Maritime News Staff