China’s Shanghai Waigaoqiao Shipbuilding (SWS) inks a letter of intent (LOI) for up to four aframax tankers with Greece's Hellespont Group.

The deal is for two firm ships plus two options.

Hellespont is said to be paying just below $47m each for the 115,000-dwt vessels, which is considered attractive.

It is slated to deliver the tankers during the second half of 2013.

One shipbuilding broker believes the price is as low as the state-owned yard could go. “Beyond that level would be a loss making,” he said.

Another newbuilding broker agreed. “SWS has a good reputation in constructing aframax tankers and it is comparable to some South Korean shipbuilders. In Korea, yards are seeking $50m to $52m for an aframax,” he said.

Last week, SWS offered a “cut throat” price for kamsarmax bulkers, reportedly quoting $30m apiece for two firm plus four optional 82,000-dwt newbuildings to Chartworld of Greece. The price is believed to represent the break-even level for the yard.