Mitsui O.S.K. to ship shale gas byproduct to India www.asia.nikkei.com
TOKYO -- Mitsui O.S.K. Lines will transport ethane, a byproduct of shale gas production, to India starting this month under a long-term contract it has signed with Reliance Industries, the largest petrochemical company in the South Asian country.
With its mainstay containership business bleeding red ink, the Japanese shipping company aims to cultivate a new source of earnings.
Under the contract, Mitsui O.S.K. will ship ethane derived from shale gas produced near the Gulf of Mexico to India for about 15 years. It will operate six Reliance-built vessels. The first of these -- completed on Wednesday -- can carry approximately 87,000 cu. meters of ethane, double the capacity of earlier models. The other five vessels will begin operating by 2017. Mitsui O.S.K. expects annual sales of 20 billion yen ($189 million).
Reliance will use the ethane to make ethylene, which will be employed in production of packaging film and synthetic rubber.
Mitsui O.S.K.'s containership business, which accounts for 40% of group sales, is losing money amid falling freight rates. Mitsui O.S.K., Nippon Yusen and Kawasaki Kisen Kaisha have decided to merge their containership operations.
Published Date:2016-11-10