Straits Times 17 Sep 09;
SHIPPING giant Neptune Orient Lines (NOL) is adopting a Singapore-designed clean fuel system for its vessels that could help the company make significant cost-savings.
NOL's container shipping subsidiary, APL, yesterday signed a five-year agreement in Singapore with Russian-led technology company Neftech to install the fuel system in 20 of APL's fleet of 139 vessels over the next year.
Fuel comprises more than half of a ship's operating costs, according to Neftech chairman Victor Levin.
While APL representatives did not give an estimate of how much the new system might save, one of Neftech's shareholders, Mr Lim How Teck, chairman of Certis Cisco, told reporters that it was expected to reduce costs by US$1.8 million (S$2.6 million) a year per ship.
NOL chairman Cheng Wai Keung said: 'In today's highly challenging business landscape, reducing costs, increasing efficiency and lessening the environmental impact of our operations are among the biggest challenges we face.'
The announcement follows NOL's introduction of a range of cost-cutting measures over the past year, including chief executive Ron Widdows and the directors taking a 20 per cent pay cut, the workforce being reduced by 9 per cent, and 15 container ships being laid up since December.
NOL, the world's seventh-largest box shipper, continues to reel from the collapse in trade.
Last month, it reported a record half-year loss of US$391 million, though the shipping sector now appears to be stabilising with the global economic recovery.
Neftech was incorporated in Singapore in 2007 and was founded by a group of Russian scientists focusing on a technology called cavitation, which helps to combust fuel more completely, reducing the amount of exhaust produced.
While it is majority-owned by Russians, it has attracted a slew of high-profile Singapore investors, including Mr S.P. Quek, chairman of China Auto Corporation, Mr Lim Ho Kee, chairman of Singapore Post, and Mr Yeo Cheow Tong, the former minister of transport.
ROBIN CHAN
