?
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Prospects for Charters from Public Sector Organisations
9
The only areas where there are likely to be any
significant opportunities are:-
a) British Rail. Mainly short haul passenger ferries. Opportunities are very limited and a proposal by British Shipbuilders on these lines some months ago did not achieve anything as BR felt the terms offered were less attractive than they could achieve by borrowing to buy on the second-hand market. The Board will be in the market for multi-purpose ferries in the future and there might be some scope for charter arrangements, perhaps as a means of advancing orders. The DTP say that it is likely that the Secretary of State for Transport will endeavour to ensure BR go to tender in the UK only for the £10 million Stranraer-Lame ferry currently being sought by the Board. If this move is successful it would not be necessary to arrange a charter to secure the order for the UK.7
b) British Steel. Officials from DoI met BSC to discuss chartering possibilities. BSC's shipping director said that there were possibilities for time charters over 2-3 years with the Hong Kong owners for ore carriers in the 110-150,000 ton range - indeed, this had been done before. However, it would be difficult presentationally for them to arrange a long-term bareboat charter (e.15 years) with Hong Kong, as BSC was already criticised for placing even short-term charters abroad. The shipping director said that he would be happy to discuss chartering with British Shipbuilders, although he saw little point in talking to the Hong Kong Mission, as BSC already had con- tacts with Y K Pao, C Y Tung and other Hong Kong owners. Moreover, he made it clear that with the current low level of freight rates for second-hand ships it would be difficult
CONFIDENTIAL