COSCO Shipping amends VLCC order with LNG-fueled option

COSCO Shipping Energy Transportation said it has signed a supplemental agreement with Dalian Shipbuilding to use LNG-fueled power for its VLCC on order at the shipyard. 

The 2020 global sulphur limit imposed by the International Maritime Organization (IMO) will take effect from January 1, 2020, onwards, placing a limit on the
amount of sulphur in fuel oil used on vessels.

Further, phase 3 of the implementation of the Energy Efficiency Design Index (EEDI) standards imposed by the IMO on new vessels will take place from 2025 onwards, placing more stringent requirements on the carbon dioxide emission of new vessels, COSCO Shipping said in its filing to the stock exchange.

In light of the foregoing, the company and Dalian Shipbuilding agreed that VLCC shall be a dual fuel crude oil carrier which can utilize liquefied natural gas (LNG) as its principal fuel.

Pursuant to the supplemental agreement, corresponding adjustments have been made to the capacity, speed and fuel oil consumption of the VLCC, and the technical specifications in relation to the LNG consumption of vessels have also been added.

Under the new agreement, the order value has been increased by a further $6 million.

Due to the changes agreed, the delivery of the vessel has been pushed back from March 31, 2021, as initially agreed, to December 31, 2021.