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Pan Ocean secures 20-year iron ore shipping contract
SOUTH Korean shipping firm Pan Ocean secured on Tuesday a 20-year iron ore shipping contract with Brazilian mining firm, Vale SA.
Under the Contract Of Affreightment (COA), Pan Ocean will ship about 32 million tons of iron ore for 20 years, from the fourth quarter of 2016 to the fourth quarter of 2036. No price details were given.
"The main objective of the company for entering into the COA is to secure a stabilized source of revenue and profit,'' Pan Ocean said on Wednesday.
The loading of the iron ore will take place in Brazil, with the despatching in China and Malaysia, among others.
Just last week, Vale entered into a 27-year COA with China Cosco, also for the transport of iron ore. Under that contract, Cosco will ship about 16 million tons of ore annually, beginning in the first half of 2018 and extending until 2045.
Pan Ocean, whose shares have been suspended from trading pending the announcement, has sought a lifting of the trading halt at 9.45am on Wednesday in Singapore. It was trading around S$3.05 a share before trading was halted.