Satellite Petrochemical orders an additional RMB 3 billion to build ultra-large ethane carriers

Satellite Petrochemical said that for the remaining four VLECs, due to factors such as tight shipyard construction space and long ship construction cycle, the company's subsidiaries have signed ship construction contracts with South Korea's Hyundai Heavy Industries and Samsung Heavy Industries. This is the first VLEC order completed in the world this year. The announcement shows that Pangtian, a subsidiary of Satellite Petrochemicals ( * * ) Co., Ltd., Pang Xin ( * * ) Co., Ltd. signed two VLEC construction contracts with Hyundai Heavy Industries respectively. ； Subsidiary company Xinren ( * * ) Co., Ltd., Xinxiu ( * * ) Co., Ltd. signed two VLEC construction contracts with Samsung Heavy Industries respectively. The total contract price for the construction of these four VLECs is US$441 million (approximately RMB 3.038 billion).

The VLEC required by Satellite Petrochemical this time has a total length of 230 meters, a width of 36.6 meters, and a height of 22.8 meters. It can load raw materials such as ethane, propane and ethylene. According to the official website, Satellite Petrochemical is the largest acrylic acid manufacturer in China and one of the top five in the world. The company's main products include propylene, polypropylene, acrylic acid, high-purity acrylic acid, etc. In March last year, Satellite Petrochemical signed a construction order for six 98,000 cubic meter VLECs with Samsung Heavy Industries and Hyundai Heavy Industries. The total price of the order was approximately US$717 million (approximately RMB 4.944 billion). Satellite Petrochemical established its own VLEC fleet to meet the huge demand for imported American ethane.

In March 2018, Satellitepetrochemical USA corp., a subsidiary of Satellite Petrochemical USA, and Sunoco Partners Marketing & Terminals LP established a joint venture, ORBIT, to plan and build ethane export facilities. Satellite Petrochemicals has announced that with the promotion of the shale gas revolution in the United States, the United States has sufficient ethane. In addition to the equipment that currently meets the requirements for ethane cracking to produce ethylene in the United States, the remaining part is currently seeking to be exported. Satellite Petrochemical said that the establishment of the ORBIT joint venture can not only occupy the ethane supply market, but also provide raw materials for the company's Lianyungang petrochemical project operation and future import and export trade business.

Chartering a ship and becoming a ship owner. Listed companies stepped on the 5 billion yuan "trap" and chartering a ship became a ship owner https://bbs.hcbbs.com/thread-3045212-1-1.html

On August 25, Korea Shipbuilding & Marine Engineering, the secondary holding company responsible for the shipbuilding business of Hyundai Heavy Industries Group, announced that the company signed a contract with an Asian shipowner to build 1+1 98,000 cubic meter very large ethane carriers (VLEC). The total contract price is approximately US$220 million. Korea Shipbuilding & Marine Engineering did not disclose the ship owner information, but according to the International Ship Network, the ship owner is Zhejiang Satellite Petrochemical. It is understood that this type of VLEC has a total length of 230 meters, a width of 36.6 meters, and a height of 22.8 meters. It will be built by Ulsan Hyundai Heavy Industries and is scheduled to be delivered to the shipowner in the first half of 2022. It is reported that this batch of orders is the first VLEC order completed in the world this year. It is reported that Hyundai Heavy Industries is building three VLECs of the same class, and with the two this time, it has undertaken a total of five VLECs so far.

At normal temperatures, ethane is a gas, and transporting this product from the United States to Lianyungang Port in Jiangsu requires specially designed ships. To this end, Satellite Petrochemical signed a ship leasing agreement with Delos Energy in July 2018, intending for the latter to provide transportation services. After receiving the transportation order, Delos Energy signed six shipbuilding contracts with South Korea's Hyundai Heavy Industries and Samsung Heavy Industries, with a total contract price of approximately US$717 million. “Ship construction funds are usually completed through financing. The financial statements submitted by Delos Energy were too poor and banks were unwilling to lend money. As a result, not a penny was paid. ”Satellite petrochemicals revealed. As a result, Satellite Petrochemical could only terminate the charter contract, and then * * Established 6 subsidiaries to undertake shipbuilding contracts, that is, chartering ships and becoming shipowners.

In 2019, satellite petrochemicals passed 6 companies* * The subsidiaries paid US$138 million in shipbuilding costs to Hyundai Heavy Industries and Samsung Heavy Industries respectively. This expense was included in the "other non-current assets" account of the company's annual report, and when converted into RMB, the amount was 953 million yuan. The six ships will be completed and delivered in October and November this year, which means Satellite Petrochemical has to pay the remaining US$579 million, which puts them in a difficult position. Considering that they are not engaged in the transportation business, now they can only look for takeovers. Recently, the resolution passed by the Satellite Petrochemical Board of Directors is to request the shareholders' meeting to authorize the board of directors and relevant persons to handle the matter. According to Satellite Petrochemical's vision, they hope that the intended shipowner can undertake 6 ships, return to the company the US$138 million in shipbuilding costs that have been advanced, and re-sign the charter contract with the company. Satellite Petrochemical's eagerness to deal with the above matters is also related to the company's ongoing refinancing. In July last year, they disclosed a private placement plan, planning to raise about 3 billion yuan for the Lianyungang ethylene project. At present, this refinancing plan has completed the second feedback and received a notice from the China Securities Regulatory Commission to prepare for the meeting. Obviously, the company does not want the "charter-to-charter-to-ship-owner" issue to cause obstacles to the ongoing refinancing.

In 2019, satellite petrochemicals passed 6 companies* * The subsidiaries paid US$138 million in shipbuilding costs to Hyundai Heavy Industries and Samsung Heavy Industries respectively. This expense was included in the "other non-current assets" account of the company's annual report, and when converted into RMB, the amount was 953 million yuan. The six ships will be completed and delivered in October and November this year, which means Satellite Petrochemical has to pay the remaining US$579 million, which puts them in a difficult position. Considering that they are not engaged in the transportation business, now they can only look for takeovers. Recently, the resolution passed by the Satellite Petrochemical Board of Directors is to request the shareholders' meeting to authorize the board of directors and relevant persons to handle the matter. According to Satellite Petrochemical's vision, they hope that the intended shipowner can undertake 6 ships, return to the company the US$138 million in shipbuilding costs that have been advanced, and re-sign the charter contract with the company. Satellite Petrochemical's eagerness to deal with the above matters is also related to the company's ongoing refinancing. In July last year, they disclosed a private placement plan, planning to raise about 3 billion yuan for the Lianyungang ethylene project. At present, this refinancing plan has completed the second feedback and received a notice from the China Securities Regulatory Commission to prepare for the meeting. Obviously, the company does not want the "charter-to-charter-to-ship-owner" issue to cause obstacles to the ongoing refinancing.