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Cabinet Committee on Economic Affairs (CCEA) today gave its approval to:
(a) Allow Shipping Corporation of India (SCI) to acquire two Very Large Crude Carriers (VLCCs) of about 3,00,000 DWT (Dead Weight Tonne), each at a price of US $ 129.10 million per vessel (Rs.568.04 crores per vessel at US$1 = Rs.44). The total investment for the two VLCCs would be about Rs.1136.08 crores.
(b) Allow SCI to avail of external financing upto the extent of 80 per cent of contract price of each vessel. The loan would be sourced either from the domestic or international market.
(c) Allow SCI to meet the balance 20 per cent of the cost from its internal resources.
The acquisition of VLCCs will lead to:
(i) Augumentation of SCI’s crude oil tanker tonnage to meet the increased demand for crude oil transportation in the coming years and to enable the Public Sector Shipping Company to cater to most of India’s crude transportation requirements, so as to reduce dependence on the foreign flag vessels and as per the current policy of the Government of India.
(ii) Employment of Indian flag vessels for import of crude oil would result in net foreign exchange savings for the country.
The acquisition process of VLCCs is likely to be completed within a period of 36 to 47 months.
DS/HK/LV
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