LENGTHENING OF A SPECIALIZED REEFER SHIP : Is it economically viable?

Abstract: A lengthening of a specialized reefer ship has been investigated in order to determine if it is economically viable or not. The ship type considered is the Crown class specialized reefer ships, where the Crown Topaz and the Crown Ruby are used as reference ships for this study. In order to determine whether a lengthening is economically viable or not, a conceptual design of the lengthened ship has been done. Costs related to the conversion and income due to the increased cargo capacity are calculated and compared in order to determine when the investment for the conversion reaches break-even. The ship is lengthened by an open-top section of 28 m, a lengthening from 152 m to 180 m. This results in an increased displacement of the ship which results in a greater cargo capacity. The extension allows for 108 extra FEU high cube refrigerated containers with a gross weight of 30 tonnes. The open-top section and necessary reinforcements are dimensioned according to the requirements of the Classification Society NKK in order to calculate the added weight and costs for the conversion. The result shows an increase in resistance of about 15% for a cruising speed of 19 knots and loaded to 80% of DWT, which is the most common load case for the reference ship. The fuel consumption thereby increases by 15% for a cruising speed of 19 knots. The extra cargo capacity of 108 containers corresponds to an increase in container capacity of 154% and about 31% of the total paying cargo capacity, while the increase in fuel consumption for the main machinery is about 15% for a cruising speed of 19 knots and the extra auxiliary engine contributes to an increase of 40 % in fuel consumption for the auxiliary engines. Costs for the conversion and loss due to off-hire time are summarized to 5.025 M. USD. The extra income for the containers is calculated to 7715 USD per day with a freight rate of 2500 USD per container. With the fuel oil price of today of 595 USD/tonne and the increased port tariffs due to the conversion, the investment will reach break-even in 4 years. Even if the fuel oil price increases about 8.7% to 647 USD/tonne the investment will reach break-even after 4½ years in operation. If the ships operates within a trade similar to the Coman-trade and with an income of 3000 USD per container the investment will reach break-even after about 2½ years with a fuel oil price of 595 USD/tonne and 3 years with a fuel oil price of 647 USD/tonne. Since the Crown class fleet has an average age of 16 years today, the conversion has to be implemented early to make the investment profitable before the ships are ready to be scrapped.