Singapore’s Pioneer Marine Inc., owner and operator of drybulk handysizes, has terminated three newbuilding contracts at Chinese Yangzhou Guoyu Shipyard within the company’s efforts to cut costs in a depressed dry bulk market.
The contracts termination will be at no cost to the company, Pioneer said.
Pioneer added that the delivery schedule of its eight newbuildings has been delayed spreading over the following two years. Namely, five vessels are now scheduled to deliver before the end of 2016 and the remaining three vessels to be delivered in 2017
“Our newbuilding program continues to represent a strategic partnership between Pioneer and Yangzhou Guoyu Shipyard. We are grateful for their support through the current unprecedented downturn in the dry bulk market. We are being proactive in creating a long runway for the company and the reduction in our capital expenditure commitments strengthens our balance sheet significantly,” said the company’s CEO, Pankaj Khanna.
According to Khanna, the cancellation frees up USD 34 million of equity commitments and the delay in deliveries pushes out the capex over an extended period.
“We have now delayed our newbuilding deliveries by a total of 96 months and also proactively raised USD 25 million of equity in August,” he added.
Pioneer Marine owns thirteen Handysize and one Handymax drybulk carriers with an additional 8 Handysize newbuildings on order.