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Norden and Glencore have entered into a new 5-year joint venture, where both parties will share the costs of rebuilding a Panamax vessel for sailing in ice in a project that is also set to lower fuel costs.

The coal carrier Nord Neptune was previously chartered by Norden on a long-term basis and, in connection with the rebuilding plans, Norden declared a purchase option on the vessel in July with handing over in September. Rebuilding a vessel for ice class takes approximately 6-8 weeks and encompasses, amongst other things, reinforcement of the hull, increased engine power and the crew will also need to be trained to sail in icy waters.

Besides sharing the costs of rebuilding, the parties will also be sharing gains and risks on chartering of the vessel during the 5 years of the contract. This means that the vessel will not necessarily be transporting Glencore cargo, it might be transporting cargoes from third party companies depending on what is the most profitable business to the joint venture.

In connection with the rebuilding for ice class, Nord Neptune will benefit from the newest technology within turbochargers as the first of Norden's vessels. The turbocharger in a ship engine is usually optimised to a performance of 85 percent.

If less performance is required, for example in connection with slow sailing, less cargo or as in this case ice-free waters, a normal turbocharger will not generate enough pressure and thus result in poor utilisation of energy. The new turbocharger is equipped with a variable nozzle ring, which means that the turbocharger's air pressure can be adjusted to the strain of the vessel.

With this new turbocharger, the utilisation of energy will remain the same regardless of whether the vessel is performing 85 percent or 65-70 percent. Savings in fuel consumption are expected to be approximately 3 percent.

"The initiative is part of Norden's ongoing efforts to reduce fuel consumption and develop still more environmentally friendly solutions," the company said in a statement.

Commenting on the agreement with Norden, Angus Paul, Head of Freight, Coal Division, Glencore International AG, Baar, Switzerland, said "We see this joint venture as the next logical step in the ongoing mutual co-operation between our two companies, and we are proud of our association together."