SHANGHAI Aug 12 Two of China's largest shipping
firms are setting up a $1.1 billion crude oil tanker joint
venture with a view to build up the country's fleet, as the
world's second-largest oil consumer seeks better control over
its oil imports.
State-backed firms China Merchants Energy Shipping Co Ltd
and Sinotrans & CSC Holdings are forming
a very large crude carrier (VLCC) joint venture, with the former
providing $566 million in assets, including nine VLCCs, for a 51
percent stake, and the latter pumping in $544 million in cash.
Oil consumption in China reached its highest level in 17
months in June. The government has previously announced that it
will invest billions of dollars to expand its oil and gas tanker
The venture, which will buy more second-hand vessels or
order new ships once established, aims to "form one of the
world's leading tanker fleet by scale, increase both parties'
share of transporting China's oil imports and international
market competitiveness", China Merchants said in a statement
late on Monday.
The deal is expected to be finalised by Sept. 30.
Sinotrans & CSC's oil shipping arm, Nanjing Tanker, this
year became the country's first state-backed firm to delist from
a domestic exchange after posting four consecutive years of
loss. It is in the process of restructuring.
(Reporting by Brenda Goh; Editing by Muralikumar Anantharaman)