Vale Mega Ore Vessel Leak Discovered Shortly After Delivery

A Vale SA vessel leased from STX Pan Ocean Co. is undergoing repairs to fix a leak in a ballast tank only about two months after being delivered. The vessel was made to transport as much as 400,000 metric tons of iron ore to China.

The leak was discovered in Brazil while the $110 million Vale Beijing was being loaded at Ponta da Madeira port. The shipping line is currently investigating the cause of the leak and is planning to move the ship for repairs.

STX Pan Ocean received the vessel from STX Offshore & Shipbuilding Co. It is the first of eight similar ships it will operate under an almost $6 billion, 25-year deal with Vale, the world’s biggest iron-ore miner. Vale wants to form a fleet of 35 of these mega-ships in a bid to cut the risk from fluctuating cargo rates to China.

Det Norske Veritas, which monitors compliance ships’ design and structural rules, have discussed technical issues with the owners already. According to reports by Bloomberg, the launch of Vale’s mega-ships has sparked opposition from Chinese ship-owners who are concerned they will worsen a capacity surplus and plunging rates. Chinese ports have so far failed to handle any of the ships, which are about twice the size of the capsize vessels now generally used to haul iron ore from Brazil to Asia.

UPDATE: As previously reported, a ruptured hull severely damaged the new Vale Beijing before its maiden voyage. After this incident, many speculations have arose regarding the safety of Valemax vessels and lobbyists are working to keep them out of Chinese ports.

If this is accomplished, Valemax will lose money in employing more vessels, workers and making port upgrades. Vale is reporting surprise in this opposition since Chinese banks financed many of these vessels which were also built at Chinese shipyards. 

It is belief that the Valemaxes will eventually make it to China after the Brazilian firm wins over authorities.