Bloomberg News

Neptune Orient Announces $1.54 Billion of Ship Orders, Upgrades

June 15, 2011

June 15 (Bloomberg) -- Neptune Orient Lines Ltd., Southeast Asia’s biggest container-shipping line, announced $1.54 billion in ship orders and upgrades as it adds larger vessels to pare operating costs on European and trans-Pacific routes.

The company ordered 10 ships, able to carry 14,000 containers each, from Hyundai Samho Heavy Industries Co. and two with capacities of 9,200 from Daewoo Shipbuilding & Marine Engineering Co., it said in a statement today. The Singapore- based shipping line also enlarged 10 ships already on order at Daewoo to 9,200 boxes from 8,400, it said.

The 22 vessels, due to be delivered in 2013 and 2014, will replace less fuel-efficient ships and allow unit APL Ltd. to add capacity as China boosts exports of auto parts and furniture to the U.S. and Europe. A.P. Moeller-Maersk A/S in February ordered as many as 30 18,000-container vessels, the world’s largest, from Daewoo as shipping lines work to pare fuel usage following an 51 percent jump in prices in the past year.

Neptune Orient will use the 14,000-container ships, which will be its largest, on Asia-Europe routes, it said. The smaller vessels likely will be deployed on trans-Pacific services, it said.

The company, which has about 150 vessels, fell 5 percent to S$1.53 in Singapore trading today, the biggest decline on the Straits Times Index. It has dropped 30 percent this year, the worst performance on the benchmark.

The shipping line has signed letters of intent for the orders, which still are subject to final agreements, it said.

The price of 380 Centistoke Bunker Fuel, used by ships, was little changed at $668.50 a ton in Singapore trading today, according to data compiled by Bloomberg. It was $441.50 a year ago.

--With assistance from Alan Soughley in Singapore. Editors: Michael Tighe, Neil Denslow

To contact the reporter on this story: Neil Denslow in Hong Kong at ndenslow@bloomberg.net.

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net.


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