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UASC's 18,000 TEUers to call at terminals run by UAE's Gulftainer

THE United Arab Shipping Company (UASC) will take delivery of five 18,000 TEU box ships by 2015, becoming the fourth global container line to order the mammoth vessels.

UASC's announcement of the 17-ship order valued at more than US$2 billion including options. IHS Fairplay reports hint at the possibility of an order valued at US$1.4 billion, for five 18,000 TEU ships and five of 14,000 TEU.

Said UASC chief executive Jorn Hinge: "We are not stating the actual contract price per ship, but your assumption seems reasonable." The options are for one vessel of 18,800 TEU and six of 14,500 TEU."

Mr Hinge said he might sell some of the ships from the new order if prevailing market conditions become suitable.

The first 14,000 TEU ship will arrive in November 2014, the first 18,800 TEU ship is for delivery in April 2015, and the final ULCS comes in December 2015. The last 14,500 TEU vessel will arrive in August 2015.

He was tight-lipped about details of the order because he said financing, which would involve a blend of international, regional and local banks, had yet to be arranged.

Competitive slot costs is the reason to deploy efficient ships, he said, citing, fuel efficiency, and delivery times. "We look at tonne-mile costs, and the quality of the ship. You have to adapt, otherwise you will die," he said.

He pointed out that UASC was a key customer of Gulftainer at Khorfakkan on the UAE's east coast.

Gulftainer's total throughput rose by 23.7 per cent in 2012, and though it operates at Jeddah, Jubail, Umm Qasr, and Recife, operations are dominated by Khorfakkan. "In our system, Khorfakkan is the most efficient anywhere," Mr Hinge said.

Sea Gateway Terminal in Jeddah has received good business from UASC, but Saudi bureaucracy is a hindrance. "Strict cargo inspection policy means delays," he said, adding that this applies to all terminals in Saudi Arabia."

The UAE is the king of capacity with its mega port Jebel Ali to come on line next year with four million TEU of capacity. "Years ago Jebel Ali was also subject to congestion. It's looking to stay ahead of the competition."

Said Gulftainer managing director Peter Richards: "The vision for the purchase of these ships cements Middle East companies as leaders within the industry. At Gulftainer, we look forward to welcoming these vessels to our terminals."