MOSCOW (MRC) -- Malaysian national shipping group MISC has entered into memorandum of agreements with China’s Zhejiang Satellite Petrochemical for the acquisition of six newbuild 98,000 cu m very large ethane carriers (VLECs), said Chemweek.
The six VLECs, currently under construction at South Korean yards Hyundai Heavy and Samsung Heavy, were originally ordered by Delos Shipping with charters fixed to Satellite Petrochemical who later took over the ownership of the six ships.
Last month, Satellite Petrochemical announced plans to sell the six vessels with charter deals. According to MISC, the company acquired the six vessels for a total price of USD726m and signed time charter contracts with Satellite Petrochemical for the vessels for a period of 15 years, commencing from the fourth quarter of this year.
Splash understands that Satellite Petrochemical is currently in talks with Korean yards for more VLECs in order to meet its ethane transportation demands from its new plant in Lianyungang. The deal also marks MISC’s entry into the VLEC sector.
As MRC infomed earlier, Zhejiang Satellite Petrochemical Co. has received regulatory approval from the Jiangsu provincial government to ethane from the US in a new polyethylene (PE) plant to be built in Lianyungang, China. The 1.25-million-t/y ethylene facility, on which con-struction is expected to begin this month, is estimated to cost USD4.2-billion. Completion is anticipated in about one year. Zhejiang will receive the ethane from Energy Transfer Partners, starting in the fourth quarter of 2020, under a 10-year supply agreement.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveris of exclusively PP random copolymer increased.
MRC