Great Eastern Shipping Company Ltd, India’s largest private shipping company (by fleet size), has won a Rs220 crore ($50 million) one-year contract from Mangalore Refinery and Petrochemicals Ltd (MRPL) to ship crude oil from West Asia to its 10.5 million tonne (mt) refinery located in Mangalore. MRPL is a wholly-owned subsidiary of India’s largest oil explorer, the state-owned ONGC Ltd.
Great Eastern has quoted a world scale rate of 117 (14.9% lower than the rate of the company’s current contract with Mercator Lines) to bag the deal, starting 1 April to transport eight mt of crude, MRPL officials said.
World scale points are rates levied by shipowners to haul crude cargo on a specific route.
These rates, quoted in dollars per tonne, are revised annually by the London-based World Scale Association, to reflect changing fuel costs, port tariffs and exchange rates. The deal involves shipping 6-8 parcels of 85,000-90,000 tonnes each of crude per month. Great Eastern has clinched the deal, beating state-owned Shipping Coporation of India, Mercator and a few other foreign shipping lines. Tanker freight rates have been falling globally as the number of ships available increase. MRPL’s contract with Great Eastern was finalized through Transchart, the centralized chartering wing of the government functioning under the Union ministry of shipping.