Chinese Shipyard Facing String of Contract Cancellations After Vessels Fail to Meet Fuel Consumption Standards

by Ship & Bunker News Team
Thursday June 11, 2015

China-based Jiangsu Sainty Marine Corp has seen a string of newbuild cancellations after the shipbuilder allegedly failed to meet deadlines and delivered vessels with higher-than-expected fuel consumption, World Maritime News reports

According to reports, a lake fighter was cancelled by an unnamed client after the shipbuilder failed to make a March 31 deadline at its Nantong Mingde Heavy Industries shipyard. 

Thai shipping company Precious Shipping also reportedly refused to take delivery of two 64,000 DWT bulkers in April, claiming that the ships did not meet the company's fuel consumption standards.

Sainty Marine has also purportedly said that it may not be able to deliver another two 64,000 DWT bulker newbuilds to Precious Shipping on time, with the two ships part of a larger order of 10. 

A separate report indicated that the company has said that it has been having troubles fulfilling the 32 contracts it has at the Mingde Heavy Industry shipyard. 

As of mid-May, three of the ships had been delivered, two had been cancelled and two were overdue. 

On top of Sainty Marine's shipbuilding troubles, the company is currently overdue on $57.5 million worth of loans and has had its bank accounts frozen. 

Last year, the company announced that it was trying to raise RMB 1.6 billion ($260 million) in order to help fund a Precious Shipping order for 16 newbuilds.