Annual Report 2000 (For year ended March 31,2000)

Business Review
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   Tanker and Energy Transportaion Services

   

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Operating revenues from Tanker and Energy Transportation Services for the term under review amounted to ¥32,330 million (U.S.$305 million), down 9.6%.

 

sankaku.gif (951 bytes)     Oil Tankers
In terms of oil tanker business, the Organization of Petroleum Exporting Countries (OPEC) controlled and adjusted crude oil production/exportation in fiscal 1999, giving rise to steep oil price hikes and also a decrease in total oil transportation quantity, resulting in low-key tanker markets in general. The VLCC market went down to WS50 from WS66 in 1998. During fiscal 1999 we sold and redelivered 2 tankers of the AFRAMAX type while 2 newbuildings with double hulls were put into the fleet.
     Regarding outlook for markets in fiscal 2000, despite progressing restructure of Japan’s oil industry, the environment looks better in general than fiscal 1999 because of strong oil demand forecast in oil consuming countries and continuous stronger demand for modern oil tankers after the disastrous oil-pollution incident in France last year. We will continue to make further efforts for upgrading the fleet in quality by introducing double-hull tankers into service.
 
sankaku.gif (951 bytes)      Steaming Coal
Regarding sea transportation of steaming coal for power generation, the Company’s business activities were greatly enhanced with our seven-vessel fleet comprised of two specialized bulk carriers, three of the CORONA ACE series and two long-term chartered carriers of PANAMAX type. In total they carried 6.5 million tons, up by 25% in this fiscal year from 5.2 million tons carried last fiscal year.
     In fiscal 2000, three 88-type bulk carriers, a revised CORONA ACE series, will join the fleet bringing the total up to 10 vessels which are expected to carry more than 7 million tons, a further 10% increase.
     The three 88-type newbuildings are scheduled to appear in June, September and November 2000, and these units precede a newbuilding of a 90-type to be completed in November 2001.
 
sankaku.gif (951 bytes)      LNG (Liquefied Natural Gas) Carriers
With regard to LNG carrier sector, our fleet amounted to 19 with two ships for the Qatar Gas Project newly in place. Nine LNG tankers delivered nearly 6 million tons of Qatar LNG to seven buyers in Japan during the fiscal year.
     The Badak Project accomplished its 1,000th voyage. It should be reported that these services have been accident-free since the start of the services in 1983. The Arun Project also will perform its 1,000th voyage in August 2000.
     As to prospect for fiscal 2000, the Company is endeavoring to positively enlarge its share in cross-trades in view of LNG being a clean source of energy and world demand tending to increase.
     The Company’s LNG fleet will increase up to 22 ships in the same fiscal year.

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