Singapore-based ship management company Eastern Pacific Shipping (EPS) has won a deal with BHP to charter five LNG dual-fuel Newcastlemax bulk carriers.
The contract is being awarded as part of the tender BHP released in July 2019, seeking vessels to cut greenhouse gas (GHG) emissions by more than 30 percent per voyage.
The stringent criteria of the tender included safety, technical and economic factors, as well as a clear demonstration to make a sustainable positive change for the industry.
The five vessels, which will be carrying iron ore between Western Australia and China, are scheduled to be delivered throughout 2022.
The LNG bunkering supply contract is expected to be awarded in October 2020.
The 209,000 DWT vessels will be fitted with high-pressure MEGI engines which reduces methane slippage to negligible levels, ESP said.
The company claims that once delivered in 2022, the ships will be compliant with the IMO 2030 target, eight years ahead of schedule.
As mandated by the IMO, all ship types are required to reduce emissions by 40 percent by 2030, and by at least 50 percent by 2050, when compared with 2008 levels.
The deal comes as industry majors look at possibilities to reduce their emissions in line with the industry’s decarbonization goals and boost sustainability.
“We are thrilled to partner with BHP, one of the world’s largest dry bulk charterers on this landmark deal. When discussions began, it became evident that our values and sustainability agendas were aligned,” EPS CEO Cyril Ducau said.
“As an established provider of marine transportation to the energy market for 60 years, EPS shares BHP’s commitment to lowering emissions in the maritime supply chain and we look forward working with them to align with the GHG goals of the International Maritime Organisation,” BHP Chief Commercial Officer, Vandita Pant said.
“The tender marks a progressive shift for BHP and the broader mining and shipping industry and is a significant step toward lowering GHG emissions in the 1.5 billion tonne iron ore seaborne market.”
Pant added that EPS offered a competitive bid and an efficient vessel design with superior fuel efficiency and GHG emissions reductions.
Further details of the charter rates were not disclosed.
“The LNG bunkering time charter contract, with a total cost of ownership less than a conventionally fuelled Newcastlemax, will enable BHP to manage the fuel supply risk, build LNG operations capability internally and capture OpEx benefits through optimization of voyage operations and fuel utilization,” she added.
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