ISLAMABAD: Pakistan National Shipping Corporation (PNSC) has unveiled plans to acquire new Aframax vessels by 2028 as part of its strategy to modernize its fleet and boost maritime capabilities, according to a report by JS Global.
During a corporate briefing, PNSC highlighted its financial performance for FY24 and future outlook. The company reported a consolidated topline of Rs 46 billion for FY24, a 15 percent year-on-year (YoY) decline. This drop was primarily attributed to a 48 percent YoY reduction in the dry cargo segment due to lower average charter rates. Additionally, slot charter operations decreased by 33 percent YoY as government consignments diminished, with no business received from the Trading Corporation of Pakistan (TCP), which had contributed Rs 2.8 billion the previous fiscal year. Meanwhile, liquid cargo revenue remained stable at Rs 40 billion.
Other income fell by 17 percent YoY, influenced by the absence of gains from vessel disposals (Rs 3.3 billion in FY23) and a lack of exchange gains amid a stable currency. However, PNSC management anticipates improved demand in the current year, driven by the dry bulk segment and new break-bulk orders from the government.
The company plans to replace four of its five Aframax vessels, which are 18–19 years old. International tenders have been floated, with bids received from shipyards in the UK, China, and other countries. The contract finalization is expected by the end of 2024. Under the State-Owned Enterprises Act 2023, PNSC can now align its procurement policies with international shipping industry standards, pending federal cabinet approval.
The new vessels will adhere to the International Maritime Organization’s emission reduction targets, including a 20 percent reduction by 2030, 70 percent by 2040, and net-zero emissions by 2050. These ships will feature internally coated tanks, allowing them to carry both dirty and clean liquids, thereby enhancing market acceptance.
PNSC intends to finance the purchases through a mix of equity and debt, with 80 percent of the cost expected to be debt-financed. The estimated cost for brand-new or under-construction Aframax tankers is $85 million each, while new-built contracts range from $73 million to $75 million. Regulatory requirements restrict the acquisition of vessels older than five years. Currently, used Aframax vessels are priced at approximately $12 million, with a scrap value of $7–10 million.
The company also aims to maintain its dry dock operations, with five vessels scheduled for maintenance. One tanker will be out of operation for 40–45 days, while four dry bulk vessels will undergo dry docking for 25–35 days.
The current fleet comprises Aframax vessels aged 18–19 years, LR-1s aged 12 years, and dry bulk carriers aged 16–17 years. Charter rates are $30,000–35,000 per day for Aframax tankers, $10,000–11,000 per ton/day for LR-1s, and $11,000 per day for bulk carriers.
The outlook for Aframax operations remains optimistic, supported by consistent demand for refinery product cargoes. The dry bulk segment has surpassed budgeted targets due to record exports of iron ore, coal, and minor bulk commodities. Tanker demand is expected to grow, driven by limited tonnage supply, creating favorable freight market conditions over the next three years.
Additionally, PNSC is reportedly engaged in discussions with a Chinese company involved in the Reko Diq mining project.
