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Varada Bhat

Mumbai, Oct. 2 Shipping Corporation of India plans to sell seven single-hull tankers by the end of this fiscal year to meet the global deadline to phase out single-hull tankers by 2010.

“Initially, we had planned to sell five single-hull tankers, but now we are looking to scrap one or two more,” Capt K.S. Nair, Director Bulk Carrier and Tanker Division, SCI, told Business Line.

In 2005, legislation by the International Maritime Organisation, a UN body for ship safety, made it mandatory to replace single-hull tankers with double hull by 2010 to check marine pollution.

A double-hull ship, in which the bottom and sides have two complete layers of watertight hull surface, is considered a safer bet against oil spill due to underwater damage or collisions. Recently, the State-owned company sold one tanker. “At present, we are planning to sell another two tankers and the deal will be done soon,” he added. The sale rate would be around $250-300 per light weight tonne.

Capt Nair said the tankers being phased out have been around for 20-25 years. Currently, SCI has around 42 tankers, of which around 30 per cent are single-hull.

“With the soft freight market, especially in the tanker segment, accentuated by the entry of new buildings in the global market, there is no sign of recovery till end of 2010. Therefore, it is a good time for Indian shipping companies to scrap old vessels,” said a shipping analyst with a brokerage firm.

The State-owned shipping firm is also looking to borrow Rs 1,300 crore by the end of the current fiscal year for acquisition of vessels. It is looking for second-hand vessels as rates have fallen steeply. “We will be substituting new buildings with second-hand acquisitions, which are relatively three to five years old,” Mr S. Hajara, Chairman and Managing Director, SCI, said.

More Stories on : Shipping/Ports | Shipping Corporation of India Ltd

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