Pipavav shipyard faces uncertainty

Mumbai-based Pipavav Shipyard, India?s newest private sector shipbuilder, may find itself grounded with six 75,000 dwt Panamax bulk carriers after a buyer announced earlier this week that it might go into liquidation. London-based Britannia Bulk Holdings Inc. said recently that following a substantial third quarter loss for calendar year 2008, it is considering liquidation or filing for bankruptcy protection, among other alternatives.

Last year Britannia had said in a statement that it would buy six medium-sized dry bulk carriers commissioned for building in March 2007 by Bermuda-based Golden Ocean Group Ltd, a dry bulk cargo ship operating firm controlled by John Fredriksen.

Golden Ocean paid $36 million to Pipavav Shipyard to build the ships and $178 million was to be paid on delivery, scheduled for between the second quarter of 2009 and third quarter of 2010. Later, Golden Ocean made a $127 million profit when it sold the ships to Britannia while the ships were being built.

“If Britannia doesn?t take delivery of the ships from Golden Ocean upon construction, that?s an issue between both of them,” Pipavav chief executive Ray Stewart said. As far as the yard is concerned, there is no change in the situation since it has a contract with Golden Ocean who will take delivery of the ships upon completion by paying the balance amount of the price agreed at the time.