Dec. 5 (Bloomberg) -- STX Pan Ocean Co. said a $110 million commodity ship, which is almost as big as the Bank of America Tower in New York, had sprung a leak in a ballast tank about two months after being delivered.
The fault was found while the 400,000 deadweight ton Vale Beijing was being loaded at a port in Brazil, STX said. The Seoul-based shipping line is investigating the cause of the leak and it plans to move the ship for repairs, it said.
STX Pan Ocean received the vessel from affiliate STX Offshore & Shipbuilding Co. on Sept. 27, the first of eight such sized ship it will operate under a $5.8 billion, 25-year deal with Vale SA, the world’s largest iron-ore miner. The vessels form part of Rio de Janeiro-based Vale’s plan to build up a fleet of 35 mega-ships to cut the risk from fluctuating cargo rates for shipments to China, the biggest buyer of iron ore, and other Asian markets.
The Vale Beijing is at Ponta da Madeira in northeastern Brazil, according to data on the Bloomberg terminal. The port, the country’s second-busiest in terms of cargo throughput, has four terminals, only one of which can handle vessels as big as the Beijing, according to Vale’s website.
Calls outside regular office hours to Vale in Rio de Janeiro and the Secretaria Nacional de Portos, the port regulator, in Brasilia were unanswered. The O Globo newspaper reported the incident earlier on its website.
Det Norske Veritas, which monitors compliance with ships’ design and structural rules, is talking to the owners of the Beijing about “technical issues,” Aage Andreas Enghaug, a spokesman, said by phone from Oslo. He said he couldn’t elaborate on what the issues were.
The launch of Vale’s mega-ships, the biggest dry-bulk vessels ever built, has sparked opposition from Chinese shipowners who are concerned they will worsen a capacity glut and plunging rates. Chinese ports have so far failed to handle any of the ships, which are about twice the size of the capesize vessels now generally used to haul iron ore from Brazil to Asia.
The miner is “confident” that it will eventually get permission to use the ships in China, Chief Financial Officer Tito Martins said in an interview last month.
STX Pan Ocean rose 1.7 percent to S$7.15 at the close of trading in Singapore. STX Offshore dropped 1.1 percent to 14,000 won in Seoul.
STX Pan Ocean’s mega-ships are the only ones ordered from Jinhae, South Korea-based STX Offshore. The shipbuilder was due to deliver one more this year, four in 2012 and one in 2013, according to a Sept. 27 statement.
The builders of the other vessels include Daewoo Shipbuilding & Marine Engineering Co. and China Rongsheng Heavy Industries Group Holdings Ltd., which won a combined 19 orders directly from Vale.
--With assistance from Michelle Wiese Bockmann in London. Editors: Neil Denslow, Vipin V. Nair
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