COSCO Shipping Development’s substantial investment of over US$1.7 billion to build 29 new vessels—23 Kamsarmax bulk carriers and six Very Large Crude Carriers (VLCCs)—is a strategic move aimed at modernizing its fleet, enhancing its global capacity, and committing to future decarbonization efforts through dual-fuel ready technology.
Fleet Composition and Investment Details
The new orders, placed entirely with domestic Chinese shipyards, are split between dry bulk and crude oil sectors, with all vessels featuring readiness for cleaner fuels.
- Kamsarmax Bulk Carriers
- Quantity: 23 vessels
- Deadweight Tonnage (DWT): 87,000 DWT (Kamsarmax class vessels are typically 80,000–82,000 DWT, indicating these are a slightly larger, optimized design).
- Investment: Exceeding US$1.0 billion
- Fuel Readiness: Methanol-ready
- Charter: Time chartered to COSCO Shipping Bulk for 240 months (20 years) following delivery.
- Delivery Schedule: Starting May 2027, with final units by the end of 2028.
- Shipyard: Dalian COSCO Shipping Heavy Industry.
- Very Large Crude Carriers (VLCCs)
- Quantity: 6 vessels
- Deadweight Tonnage (DWT): 307,000 DWT (VLCCs are generally classified as 200,000–320,000 DWT).
- Investment: Approximately US$716 million
- Fuel Readiness: Methanol/LNG dual-fuel ready
- Charter: Time chartered to COSCO Shipping Energy Transportation for 240 months (20 years) following delivery.
- Delivery Schedule: Starting April 2027, with final units by November 2028.
- Shipyard: Dalian Shipbuilding Industry Co (DSIC).
Strategic Significance
The investment package highlights three core strategies for the Chinese shipping giant:
- Decarbonization and Modernization: By ordering methanol-ready bulk carriers and methanol/LNG dual-fuel ready VLCCs, COSCO is preparing its fleet for upcoming international environmental regulations, such as those discussed by the International Maritime Organization (IMO). This aligns with a broader industry trend toward alternative fuels to reduce greenhouse gas emissions.
- Capacity Expansion and Renewal: The addition of 29 new, modern vessels will refresh and expand COSCO’s capacity in two critical segments: the dry bulk trade (iron ore, coal, grain) and the crude oil transportation market. This follows earlier orders for Newcastlemax bulkers and multipurpose vessels, signaling a comprehensive fleet renewal effort.
- Long-Term Commercial Stability: The immediate, 20-year (240-month) time charter agreements with its own subsidiaries (COSCO Shipping Bulk and COSCO Shipping Energy Transportation) ensure that the new assets will generate stable, long-term revenue streams within the COSCO Group upon delivery.
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Source: Riviera
