Friday, September 24, 2010

Danish Shipping Group Prepare Ice Class Freight Vessels

Long Term Contract Targets Frozen Assets
Shipping News Feature

DENMARK – Dry Cargo and Bulk Tanker shipping line Norden A/S, who operated a fleet approaching two hundred vessels last time we counted, have found a new market they consider worthy of attention. With all the recent revelations regarding the opening of sea lanes previously inaccessible due to the ice, the company has increased its fleet of Ice Class vessels in cooperation with a major customer.

In the new venture Norden have teamed up with Glencore, one of the world’s largest commodity producers and traders, in a new 5-year joint venture to secure future transport from Russia to Europe even in the coldest of winter months. The parties will share the costs for preparing the Nord Neptune for sailing in ice and the gains from future chartering of the vessel. The ship was previously chartered by them on a long term basis and in connection with the rebuilding plans, Norden declared a purchase option on the vessel in July with handing-over in September.

Rebuilding a vessel for ice class takes approximately 6-8 weeks and encompasses, among other things, reinforcement of the hull, increased engine power, and on top of this, the crew needs to be trained in sailing in icy waters. Besides sharing the costs of rebuilding, the parties will also be sharing gains and risks on chartering of the vessel during the 5 years of the contract. This means that the vessel will not necessarily be transporting Glencore cargo; it might be transporting cargoes from third party companies depending on what is the most profitable business to the joint venture.

The Norden dry cargo fleet now has a total of three ice classed vessels, two Panamax ships are already equipped for the conditions with an additional three more ice classed Handysizes on order at a South Korean shipyard. The turbocharger in a ships engine is usually optimised to a performance of 85%. If less performance is required, for example in connection with slow sailing, less cargo or as in this case ice-free waters, a normal turbocharger will not generate enough pressure and thus result in poor utilisation of energy.

Using the very latest technological innovations, Norden’s newest addition will utilise a new turbocharger in which air pressure can be adjusted to the strain the vessel is under. This will reduce the vessels fuel consumption by about approximately 3% on a normal voyage.