NSCSA Exercises Option to Build Two RoCon Vessels with Hyundai MIPO, South Korea

The National Shipping Company of Saudi Arabia (NSCSA) announced on Monday, the 12th September, 2011 that it exercised the option to build 2 RoCon vessels with the builder Hyundai MIPO of South Korea. This is in line with its corporate strategic initiatives that call for expansion of the General Cargo Sector. NSCSA signed the building agreement on March 06, 2011 with Hyundai MIPO to build a firm 4 RoCon vessels and 2 optional RoCon vessels with the same specifications for a total cost amounting to 1,543 Million Saudi Riyals.

NSCSA signed a Murabaha Financing Agreement on June 22, 2011 which will be utilized to finance 80% of the cost of constructing the two RoCon vessels and the remaining 20% will be financed by NSCSA.

The 1st vessel will be delivered during the month of December 2012; the remaining deliveries will be each vessel for every three months. Upon delivery, these 6 vessels will replace NSCSA’s current RoRo ships that are operating as a liner service between The United States East Coast to the Middle East (Red Sea-Arabian Gulf) and to the Indian Sub-Continent (ISC) via Europe.

These vessels are specialized in carrying general and project cargo and several other types of RoRo cargo. Equipped with heavy lift cranes, these vessels also have the capacity of carrying containers in the designed area onboard the vessel. The deadweight of each vessel is apprx. 26,000 tons. Additionally, these vessels are unique in their smaller size compared to the current fleet and have more cargo lifting capabilities with less fuel oil consumption.

NSCSA was awarded a contract to provide transportation and logistics services for the Ministry of Defense and Aviation (MODA), Saudi Arabia for a total value of 230 million Saudi Riyals for a 3-year period. The contract is effective from September 11, 2011 and the financial impact thereof will appear in the last quarter of the current year 2011.

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Source: NSCSA, September 13, 2011;