• Thu
  • Nov 27, 2014
  • Updated: 4:22pm

Shipping firm's beef about paint 'baseless'

PUBLISHED : Thursday, 02 August, 2012, 12:00am
UPDATED : Wednesday, 15 August, 2012, 10:51pm

A Scandinavian shipowner has hit back at claims by a Hong Kong shipping company that technical issues led it to return four ships it had on charter from the Western firm.

Ole Hjertaker, chief executive of Norway's Ship Finance Management, said Hong Xiang Shipping Holding (Hong Kong) 'had not paid charter hire for three months' before it returned the four ships last week.

He said for the shipping company to claim there was an issue with the way the ship was painted was a 'baseless argument'.

Hong Xiang also returned a 176,000 deadweight tonne (dwt) dry cargo Capesize vessel to shipowner Knightsbridge Tankers that still had at least 26 months to run on the charter. Ship Finance and Knightsbridge are linked to Norwegian shipping mogul John Fredriksen.

Philip Ho, a senior executive at Hong Xiang's Sheung Wan office, said: 'As far as we know, the vessels were not compliant with PSPC [performance standards for protective coatings] regulations.'

The standards have been made mandatory by the International Maritime Organisation to help prevent corrosion of the steel used to build ships.

Hong Xiang, a subsidiary of mainland mining, shipbuilding and steel conglomerate Beijing Jianlong Heavy Industry, chartered the four 34,000 dwt Handysize ships from Ship Finance International last year and this year for five years at about US$14,000 per day.

This equates to a total of US$5 million for the three months Hong Xiang failed to make lease payments and more than US$102 million in total for the four five-year charters.

The Capesize ship, Golden Zhejiang, was chartered by Hong Xiang at US$32,326 per day until September 7, 2014, with an option for a two-year extension.

Hjertaker and Knightsbridge said there were parent guarantees given by Beijing Jianlong Heavy Industry when the charters were agreed, and legal moves would be made to recover the outstanding unpaid hire plus damages.

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