MEPC81: vulnerable island nations see much deferred and little agreed
Despite vocal advocacy from vulnerable island nations, such as the Cook Islands, Marshall Islands and ...
By Mike Wackett
Greek non-operating containership owner Danaos Corporation has confirmed an order for four 7,200 teu ‘methanol fuel-ready’ newbuild vessels, for delivery in the first half of 2024.
The ships will be built at the Daehan Shipbuilding yard in South Korea and, in advance of the availability of methanol fuel, they will be fitted with open loop scrubbers and comply with International Maritime Organization Tier 3 emissions standards and Energy Efficiency Design Index (EEDI) Phase 3.
CEO Dr John Coustas explained that the strategy of ordering dual-fuelled vessels with scrubber technology “removed the risk of technical obsolescence”, while delivering short- and medium-term fuel cost benefits.
“World developments are pointing to significantly elevated fuel prices in the future and, bearing in mind the uncertainty of green fuel availability, we are following a strategy of investing in the most fuel-efficient vessels, with scrubbers that will minimise the fuel cost while maintaining the option to modify the vessels into green methanol use when it is available,” said Dr Coustas.
The new order follows one in March for two 7,100 teu methanol-ready vessels from the Chinese yard of Dalian Shipbuilding for delivery in the second and third quarters of 2024.
With a dearth of ships coming onto the second-hand market, Danaos has turned to new tonnage to boost its growth.
Danaos has not revealed the purchase price for the newbuilds, but according to VesselsValue, the current market value of 7,100 teu ships is between $100m and $107m.
Officially, none of the ships have charters attached, but in the present bull market the NOO will have no shortage of enquiries from carriers seeking long-term deals.
Including the newbuild orders, Danaos’s fleet totals 77 containerships with a total capacity of 479,589 teu. At the end of last year, the company’s contracted revenue backlog amounted to $2.85bn, with charters extending through to 2028, and an average remaining period of four years.
Operating revenue last year was $690m, compared with $462m the year before, for an adjusted net income of $362m, versus $171m in 2020.
However, Danaos declared a net profit of $1.05bn for 2021, the significant difference mainly due to its fair value gain in investment in its 7.2 million Zim shares, which it said had “surpassed all reasonable expectations”.
In 2014, Danaos had become a then reluctant partner in Zim’s financial restructure, which saw creditors swap $1.4bn of debt for equity. At the time, Zim had six panamax ships on charter from Danaos until 2020, but had underpaid the daily hire rate, claiming this was a temporary measure until the markets improved.
And in 2016, Danaos fell victim to the collapse of Hanjin Shipping, which at the time had eight vessels on long-term charter. Danaos submitted a claim of $600m for unpaid charter hire to the bankruptcy court and, so far, has received $3.9m in compensation.
Meanwhile, reports to The Loadstar suggest Asian shipyards have reached, or are very near, full capacity, with some yards talking about 2025 onwards for new deliveries.
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