On November 11, China CSSC Holdings Limited (CSSC) issued an announcement stating that its wholly-owned subsidiary, Dalian Shipbuilding Industry Corporation (DSIC)—in collaboration with China Shipbuilding Trading Co., Ltd. (CSTC)—has signed contracts for the construction of 20 Very Large Crude Carriers (VLCCs), each with a capacity of 307,000 deadweight tons (DWT). The contracts were entered into with Hainan COSCO Shipping Energy Transportation Co., Ltd. (a subsidiary of COSCO Shipping Energy Transportation Co., Ltd.) and Oriental Fortune International Limited (a subsidiary of COSCO Shipping Development Co., Ltd.). The total value of the contracts is 17.21812 billion yuan (approximately $2.583 billion at the current exchange rate), with the vessels scheduled for delivery between 2029 and 2030.
Specifically, Oriental Fortune International—a subsidiary of COSCO Shipping Development—has placed an order with DSIC for 16 VLCCs, each with a capacity of 307,000 DWT. The total contract value is 13.42512 billion yuan (excluding tax), with a per-vessel price of 839.07 million yuan (excluding tax, approximately $126 million). The contract will be denominated and settled in Chinese yuan (RMB). The new vessels will feature a design that is “dual-ready” for both methanol and LNG fuel, with deliveries scheduled to take place progressively between October 2029 and December 2030.
According to an announcement released by COSCO Shipping Development on the same day, upon delivery, this batch of VLCCs will be leased out under long-term bareboat operating leases to Pan Cosmos Shipping & Enterprises, a subsidiary of COSCO Shipping Energy.
Under the vessel leasing agreements signed by the parties, the lease term for each vessel is 240 months (plus or minus 90 days) from the date of delivery, with the ±90-day adjustment at the charterer’s discretion. Upon the expiration of the lease term, each vessel shall be returned to Oriental Fortune International. The rental structure for the 16 VLCCs consists of a combination of “fixed bareboat charter rates” for 8 vessels and “guaranteed base rates plus profit-sharing” for the other 8 vessels, with an average fixed daily charter rate of 116,520 RMB per vessel (excluding tax).
COSCO Shipping Development notes that the operating bareboat charters for these newly built vessels will utilize a rental structure combining “fixed rent with a guaranteed revenue-sharing component.” This approach allows for potential upside during market upswings while securing a baseline return during market downturns, thereby mitigating operational risks associated with cyclical fluctuations and enhancing the overall stability and earnings predictability of the projects. Furthermore, by collaborating with enterprises across the shipping industry supply chain, the company aims to cultivate use cases for the Chinese yuan throughout the “shipbuilding, leasing, and shipping” lifecycle—deepening the practical application of the RMB within the international shipping sector and strengthening its own competitive position in the market.
COSCO Shipping Energy places order for 4 VLCCs
Hainan Energy, a subsidiary of COSCO Shipping Energy, has placed an order with DSIC for four 307,000 DWT VLCCs. The contract is denominated and payable in Chinese yuan (RMB), with a total value of 3.793 billion yuan (inclusive of tax; approximately $569 million)—equating to 948 million yuan (inclusive of tax) per vessel. Delivery is scheduled to take place between September 2029 and May 2030.
COSCO Shipping Energy had already disclosed this order in an announcement on November 9. The new vessels will feature clean propulsion systems—including designs “ready” for LNG/methanol dual-fuel operation—as well as energy-saving and intelligent systems. Additionally, COSCO Shipping Energy has placed an order for six VLCCs with COSCO Shipping Heavy Industry (Yangzhou). The contract value for these vessels is 5.689 billion yuan (inclusive of tax), with deliveries scheduled between August 2029 and November 2030.
COSCO Shipping Energy stated that the 10 VLCC crude oil tankers ordered this time are an important measure for the company to seize market development opportunities, optimize fleet structure and practice green and low-carbon development. Through this transaction, COSCO Shipping Energy will consolidate and expand the capacity of the tanker fleet and enhance the service capabilities and competitiveness of the foreign trade crude oil transportation market, which is in line with the company’s long-term development strategy and the interests of all shareholders.
Regarding the order for 20 VLCCs secured by DSIC, CSSC stated that this vessel type represents a new generation of flagship VLCCs, independently developed and designed by DSIC. The design aligns with the global shipping industry’s shift toward green energy and complies with the latest international environmental standards. The vessels’ performance metrics rank among the best in the world, with top-tier global standards achieved in key areas such as overall performance, environmental sustainability, and operational reliability.
DSIC was the first shipbuilder in China to construct VLCCs and has long maintained a competitive edge in the VLCC construction market. This contract, which involves a significant number of vessels, allows DSIC to leverage its efficiencies in construction while further consolidating its market-leading position in the VLCC sector.