Greek Shipping News Cuts
Week 32 - 2006


Greeks ride wave of ship acquisitions

A total of 674 secondhand cargo ships and tankers were sold in the first half of this year, against 640 in the same period of 2005, according to Allied. A total of 817 ships of all types changed hands, for $18.4 billion. Their total capacity was 38.3 million deadweight tons (dwt). Bulk carriers formed the largest category; 414 of them were sold for a total of $6.7 billion. The number of tankers sold was 260, for a total of $8.2 billion. In the first half of 2005, 360 bulk carriers changed hands for $7 billion and 280 tankers for $8.7 billion.
The switch of many operators to bulk carriers reflects the continuing rise in freight rates. In the first six months, the charter rates index for panamax carriers was 25.72 percent higher, the supramax index rose almost 22 percent and the capesize index gained 15.43 percent. Shipping agents are taking the view that the rally will continue.
New vessels
Greek shipowners placed orders for new vessels at various shipyards worldwide worth a total of $6.6 billion in the first six months of 2006, according to a study by G. Moundreas & Co. This was just under double the value of the orders placed in the same period last year. In March alone this year, Greeks ordered 48 new vessels - the same number ordered in the whole first half of 2005 - worth $3 billion.
Of the total of 118 vessels, 93 were tankers, 15 bulk carriers, two liquefied gas tankers (LPGs) and eight container ships. Their total capacity (excluding LPGs and container ships) was 10.57 million dwt. In the first half of 2005, Greek orders for new vessels totaled 62, of which were 24 tankers, 11 bulk carriers, 17 LPGs and eight container ships, totaling a capacity of 2 million dwt.
Source:, 8 Aug 2006

DPW to invest in Greek ports
Officials from DP World met the Greek Minister of Merchant Marine Manolis Kefaloyiannis late last week to underline their interest in investing in the country's ports.
A DP World spokeswoman has confirmed the negotiations between DP World and the Greek Minister and declined to give further details, but promised however to announce the results of the talks sometime in the future.
Coming hard on the heels of last week's visit by China Ocean Shipping Group president Wei Jiafu, who had talks with the Greek Prime Minister Costas Karamanlis, this meeting is seen by industry observers as adding substance to government claims of mounting interest in the country's ports sector. DP World executives last flew to Greece in May and are reported to have visited both Piraeus and Thessaloniki ports, as well as the Tympaki area of Crete, where the ministry wants to develop a new container transshipment hub.
DP World was named in a marine briefing paper early last week among three overseas groups to have shown interest in investing in the two top Greek ports.
Together with Cosco and the rival Chinese giant China Shipping, DP World's approach was deemed "indicative" of the sector's wider appeal. According to the ministry, this also includes interest from Greek investors.
Privatisation to date has consisted of the Piraeus and Thessaloniki port corporations being listed on the Greek stock market, but the government has promised further privatisation for next year.
The government's plans are still sketchy as are details of the proposals being hatched by various suitors, although it now appears that there is real interest in the ports. The sector was the main source of discussion last week during a meeting between Karamanlis and Kefaloyiannis, after which the latter reportedly said: "Major investment in Greece is starting from Greek ports."
The government has already signed a 10-year protocol with European Investment Bank, running up to$3.8 billion in loans on development projects in the ports costing up to $7.6 billion.
The commercial harbour of Piraeus is one of the most important in the Mediterranean. The city itself with its suburbs is an industrial zone of particular importance for the Greek economy, while the Port of Thessaloniki has significant advantages as the main European sea gate in the Balkan region.
The port of is one of the top two Greek critical export and transit ports and the main sea hub to the Balkan hinterland. It is also the nearest EU port to the Balkan countries and the Black Sea zone.
Source:, Khaleej Times - 09/08/2006

---One deal worth $300m stalls because no builder can handle order, writes Nigel Lowry in Athens- Monday August 07 2006
BROKERS are painting a picture of increasing frustration among dry bulk shipowners unable to secure berths for lucrative construction projects in what is otherwise emerging as an active summer for shipbuilding contracts.
Implicit in many discussions is that, despite burgeoning construction capacity in China, discerning owners are handicapped even more than other would-be investors in new bulkers.
Many of the most established Greek owners were not tempted to order at some of the emerging Chinese provincial shipyards, he said, citing lack of track record and refund guarantees.
While Far Eastern yards have been trying to concentrate on large gas carriers and container vessels tankers still offer huge differentials in income for builders compared with humble bulkers.
For Greeks the apparent bulk carrier drought stretches back several weeks. Last reports of dry bulk orders were in May when Sea Traders was said to have contracted two large panamaxes from Universal and Restis Group signed a deal for a minimum three capesizes at Sungdong, a South Korean builder that has rattled up an order book for 68 vessels.
With the market already rewarding for owners, limited contracting has helped to ensure that the dry bulk fleet will grow by less than 3% in the next few years.

ABS wins 2 prestige court rulings
---US-based classification society American Bureau of Shipping has won two points in its long running series of legal battles relating to the 2002 loss of the tanker prestige and subsequent pollution of the Spanish coast.
In the first ruling US District Court Judge Laura Taylor Swain has dismissed the claims of the Basque communities against ABS relating to the loss of the oil tanker Prestige and has ruled the case closed.
Following the court ruling ABS has requested that access to the entire Corcubion File be granted by Spain within 10 days.
Source:, Thursday, 10 August 2006

'Prestige' battle could turn class
---A "punch-up" between Spain and a top classification society may change the face of maritime safety.
I will not dare touch on some of the allegations that are flying hither and thither between the government of Spain and the American Bureau of Shipping (ABS) over the Prestige disaster for fear of inflaming the situation further.
But I am concerned that such a supercharged atmosphere is one that could influence shipping policy and fear that a forthcoming court case between the two could affect the future of safety in the industry.
The Prestige began to list off the coast of Galicia on 13 November 2002 with 77,000 tonnes of fuel in its hold. Its Greek master called for help and asked to be towed into a port of refuge.
The Spanishauthorities, fearing the tanker was going to break up, instead towed it out to sea where it did indeed fall apart, polluting the sea and hundreds of kilometres of beaches in Spain and neighbouring France.
The Madrid government came under a merciless assault from local newspapers. Take this from an editorial in El Pais on 12 December: "Public opinion doesn't mainly reproach the government for making the wrong decisions but for being incapable of explaining who, when, and why those decisions were taken."
Earlier in the month, newspaper El Mundo had asked why more floating barriers had not been put in place to protect the shoreline and where was the money that was promised to fishermen whose livelihoods were affected.
Following huge demonstrations in Galician cities in the same month, the government ordered the army to move in and sweep the beaches clean and said there would be cash compensation for affected families.
But it is worth remembering all of this to understand what kind of pressure the authorities were under then and why, despite clamours for his freedom, it took so long for them to release on bail the poor master, Apostolos Mangouras, who had been jailed.
So the Spanish government has a lot of public opinion to satisfy in this case, never mind the need to explain why it refused to allow the vessel into port.
On the other hand, ABS is also fighting for its credibility, not just for itself but for the wider class system. These organisations are under pressure like never before with the European Union and even the International Maritime Organisation planning initiatives to ensure they do their job better.
I have expressed the hardly unique view before that class societies are far too beholden to their customers. This has nothing to do with the Prestige case but just a wider point that shipowners sit on the class boards, pay class societies much of their revenues and yet are expected to be given "independent" safety advice.
To an outsider there seems to be a conflict of interest and I think that and many other parts of the class system need changing. But for all of that, I do worry that a punch-up between a government and top-class society over one vessel sinking in a hot and sweaty courtroom is going to influence a debate that ought to occur in an air-conditioned office.
If you look back at history, it has often been one single accident that has turned the tide on a shipping debate. Just look at the Exxon Valdez , which hastened the Oil Pollution Act of 1990, to realise that.
Of course, the current case is certainly not the first time that a class society has found itself under attack for a vessel accident. Indeed, it is quite common but this time there is more than the Prestige case at stake.
By Terry Macalister's, Wavelength, published: 11 August 2006

easyCruise goes grey in Belgium
Source: 11 Aug 2006

DryShips Inc. Expanding Its Fleet to 33 Vessels
---DryShips, Inc. (NASDAQ: DRYS), a global provider of marine transportation services for drybulk cargoes announced today that it entered into an agreement to acquire 4 Panamax dry bulk carriers from an unaffiliated third party. The acquisition is subject to customary closing conditions.
These four Panamax vessels have an aggregate carrying capacity of 283,042 dwt; two were built in 1994 and two were built in 1996. The vessels are sister ships to vessels in the existing fleet of DryShips. The total consideration paid for the vessels will be approximately $111 million.
Following the acquisition of these four Panamax vessels, DryShips' fleet will consist of 33 dry bulk carriers with an aggregate carrying capacity of 2.68 million deadweight and an average age of 11 years. DryShips is the largest US listed drybulk shipping company.
DryShips expects to take delivery of these Panamax vessels between the beginning of September and end of October of this year. DryShips will take over the vessels with their present employment as follows:
Earliest Latest
Re- Re- TC rate
Vessel Built Dwt Charterer delivery delivery ($/d)
Panamax TBN 1994 70,003 BHP Billiton May-07 Sep-07 18,500
Panamax TBN 1994 70,029 Sinochart Oct-06 Dec-06 16,100
Panamax TBN 1996 70,002 BHP Billiton May-07 Jul-07 18,000
Panamax TBN 1996 73,008 Cargill Sep-06 Oct-06 17,500
George Economou, Chairman and Chief Executive Officer, commented, "Once again we are pleased to have the opportunity to expand our Panamax fleet, which has been the segment of our strategic focus. This latest acquisition demonstrates our commitment to growing DryShips and capitalizing on the strong long-term fundamentals of the dry-bulk industry. We expect these four purchases to be accretive to our 2006 and 2007 earnings."
Source: ATHENS, GREECE -- (MARKET WIRE) -- August 07, 2006 --

Diana Shipping Inc. Reports Financial Results for the Second Quarter and Six Months Ended June 30, 2006
--- ATHENS, Greece, Aug. 9 /PRNewswire-FirstCall/ -- Diana Shipping Inc. (NYSE: DSX), a global shipping transportation company specializing in dry bulk cargoes, today reported net income of $13.2 million for the second quarter of 2006, compared to net income of $20.1 million reported in the second quarter of 2005.
The results for the 2006 second quarter also include a non-recurring preferential deemed dividend in the amount of $20.3 million, relating to the purchase of Diana Shipping Services S.A., the fleet management company that Diana Shipping Inc. acquired on April 1, 2006. Taking into account this amount, the Company recorded a net loss available to common stockholders for the second quarter of 2006 of $7.1 million. The accounting treatment of the acquisition of the fleet manager was first described in the Company's initial public offering prospectus.
Voyage and time charter revenues were $26.1 million for the second quarter of 2006, compared to $29.4 million for the same period of 2005, due to a decrease in prevailing time charter rates offset by an increase in the number of vessels in the Company's fleet. Voyage and time charter revenues and net income reported for the second quarter of 2006 have been reduced by $0.8 million, reflecting the non-cash amortization of the prepaid time charter revenue of the vessel Thetis to apply for the entire duration of the time charter contract.
Net income for the six months ended June 30, 2006, amounted to $24.9 million compared to net income of $34.7 million for the same period of 2005. Net income available to common stockholders during the period was $4.6 million. Voyage and time charter revenues were $50.3 million for the first six months of 2006, compared to $53.3 million for the same period of 2005. Voyage and time charter revenues and net income reported for the six months ended June 30, 2006 have been reduced by $1.6 million, reflecting the non-cash amortization of the prepaid time charter revenue of the vessel Thetis to apply for the entire duration of the time charter contract.
"We are pleased to announce that we have increased earnings per share, prior to the preferential deemed dividend, to US$0.28 from US$0.26 as compared with the first quarter, an increase of 7.7%. Our business strategy and successful chartering policy have resulted in our being able to increase our dividend for the second quarter of 2006 to 35.5 cents per share, more than we paid for the first quarter of 2006. Since our Company became public, we have declared US$95.8 million in dividends for our shareholders," said Simeon Palios, Chairman and Chief Executive Officer of Diana Shipping Inc.
Mr. Palios also cited the Company's low debt, high dividend payout policy and prudent chartering strategy. He noted, "The time charter contracts we entered into for four of our vessels earlier this year, which adjust their earnings based on the daily average time charter rates on four established routes, together with the vessels whose employment contracts are due for renewal in 2006, should enable our Company to take advantage of favorable freight market conditions going forward."
Dividend declaration
The Company has declared a cash dividend on its common stock of $0.355 per share, based on the Company's results from operations during the second quarter ended June 30, 2006. The cash dividend will be payable on or about August 31, 2006 to shareholders of record as of August 18, 2006. The Company has 53.05 million shares of common stock outstanding.