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Investment in Design Cornering the ULCC Niche by David Tinsley, technical editor For an independent tanker owner to undertake a newbuild fleet development program amounting to 3-million tons of crude oil carrier capacity in itself demonstrates a high degree of business verve. But to emphatically put one's own stamp on the design, construction and equipping of such tonnage is an added expression of will, given the production- driven tendency in the industry towards shipyard-orientated and class-minimum specifications. Piraeus-based Hellespont Shipping Corp.'s commitment to a new generation of ultra large crude carriers (ULCCs) is exceptional on its own account, given the paucity of new investment in the cat- egory over the past quarter-century. The company is already an active exponent of oil transportation on the ULCC scale, controlling six tankers in the 315,000- 421,000-dwt range. The technical chal- lenge presented by a return to new con- struction in the ULCC segment is all the greater for the added structural com- plexity imposed by mandatory double hulling. In addition to four 302,700-dwt VLCCs booked with Samsung Heavy Industries, Hellespont has three 442,470-dwt newbuilds contracted at Koje Island's other major shipbuilder, Daewoo Heavy Industries. Confirmation of a fourth ULCC from the Okpo yard is on the cards. It claims that both classes of vessel, due to be commissioned between September next year and December 2002, will set a new standard for large tankers. Counter to the trend in the industry, where owners' actual preferences are often subjugated to shipyard production considerations, Hellespont's nascent VLCCs and ULCCs reflect a very high degree of tailoring to the contractual party's requirements founded on expec- tations of long life and dependable, safe — as well as efficient — service. The additional features and construc- tion criteria stipulated by the shipown- ing group are understood to have carried a premium in excess of $10 million rel- ative to the going market rate for such tonnage. Judicious timing of the order, including the program's array of options, now largely exercised, presumably made the additional expenditure more palat- able to the company, which is 51 percent owned by Basil Papachristidis' Helle- spont Group and 49 percent by Loews Corp. The extra capital outlay is indeed a measure of a long-term trading perspec- tive, and will create a more effective platform for the sound operating and maintenance practices, which are also elemental to the Hellespont philosophy. The shipowning group is unequivocal in its belief in the inter-relationship between investment in a higher standard of design, construction and equipment in factors of efficiency, market competi- tiveness, safety and environmental pro- tection. Moreover, the improved ship produc- tivity arising from the adoption of a higher power concentration for a faster speed, coupled with the extra shipment capacity vested in the ULCCs, should place the company in a particularly advantageous earnings position at times of exceptional rates. All longstanding shipowners know from experience that even short-lived peaks can generate enormous revenue gains that more than offset long periods of trading at lacklus- ter rates. Introducing a higher standard from the outset, and being equally diligent in ensuring the requisite upkeep, also has a signal bearing on asset values in a no less fickle sale and purchase market. Do You WANT MAXIMUM PERFORMANCE FROM YOUR DIESEL ENGINE? PROTECT YOUR INVESTMENT. 12 Circle 276 on Reader Service Card Maritime Reporter/Engineering News When you've invested in the boat of your dreams, you need to protect the engine you depend on. FUEL MAG breaks down the sludge, algae and microbes that can clog filters and settle in tanks, contaminating the fuel. A one-time, maintenance-free installation increases filter life; reduces clogged injectors; extends diesel engine life and eliminates using toxic biocides. FUElMAG TOLL FREE (888) 825-4239 WEB SITE www.fueldyn.com Dealer Inquiries Invited Fuel Dynamics • PO Box 523 • Cape Canaveral, FL 32920 • FAX (321) 784-5663 Bureau Veritas Certificate of Type Approval, Certificate #08446/A0 BV
