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Brightoil Petroleum (Holdings) Ltd., one of the largest service providers of marine bunkering in China, has announced that the group has entered into five shipbuilding contracts to acquire five 318,000 DWT VLCC crude oil carriers at a total consideration of US$537,500,000 (equivalent to approximately HK$4.2 billion).

Brightoil said 50 percent of the consideration will be payable in different stages over the shipbuilding period and the remaining 50 percent of the consideration (subject to adjustments) will be payable upon delivery of the VLCCs, which is expected to be between July 2012 to March 2013. The total consideration is expected to be funded by bank financing and internal resources of the group.

The five 318,000 DWT VLCCs, are to be built, launched, equipped and completed by Hyundai Heavy Industries Co. Ltd. and will be built to Common Structural Rules (CSR), the latest standard for newly-built tankers.

Brightoil said the VLCCs will be fitted with the latest main engines, which will offer reduced fuel consumption, improved energy efficiency and lower emissions, thus confirming the group's commitment to protecting the environment.

The VLCCs will also be equipped with heating coils and blending equipments, allowing more flexibility in cargo trading and bunkering operations.

The purchase of the VLCCs will greatly increase the group's oil carrying capacity and is in line with Brightoil's strategy of building a fleet of ocean-going vessels to support its global expansion plan for its marine bunkering business.

Commenting on the acquisition, Dr. Sit Kwong Lam, Chairman and CEO of the group, said, "The timing of acquiring the VLCCs is highly attractive and the consideration is reasonable. Together with the 4 ocean-going oil tankers with over 100,000 DWT each already acquired, the group will have 9 high quality oil tankers to support our rapid expansion in the marine bunkering business worldwide. The ocean-going oil tankers will be mainly used for transporting crude oil or fuel oil internationally. The group intends to operate these oil tankers for in-house fuel oil procurement, so as to lower the operating cost for our global marine bunkering business, and to charter out spare capacity to generate additional revenue."