September 07, 2008

Oman Shipping to spend USD 4 billion on fleet expansion

Reuters quoted Mr Kuldeep Mathur CFO of Oman Shipping Company as saying that it is aiming to spend up to USD 4 billion over the next 3 to 4 years to expand its fleet size to meet the demand for energy transportation. Mr Mathur said that "We are expanding the fleet with a view of the future demands for our export grade crude and products."

Part of Oman Shipping Company's multi billion dollar expansion includes a recent order to build 10 very large crude carriers. In February 2008, it placed 2 separate orders with South Korea's Hyundai Heavy Industries Co to build 5 supertankers and with Daewoo Shipbuilding and Marine Engineering Co to build another 5 very large crude carriers.

Mr Mathur said that financing for Oman Shipping Company's fleet expansion could likely come via loan arrangements from the North Asian institutions, Japan Bank for International Cooperation, Korea Export Insurance Corporation or European banks BNP Paribas and Societe Generale. He added that "We have a very good relationship with several banks and could look to either one to finance our expansion plans."

Mr Mathur added that Oman Shipping Company is in discussions with the National Iranian Tanker Company on securing a long term charter contract for at least 5 of the recently ordered supertankers. He added that "Yes, we are discussing the option with them, along with others, but we are not decided yet."