Eimskip, Royal Arctic Line Pact Okayed

Maritime Activity Reports, Inc.

April 17, 2019

Pic: Royal Arctic Line

Pic: Royal Arctic Line

The oldest shipping company in Iceland Eimskipafélag Íslands (The Icelandic Steamship Company), also known as Eimskip, said that its collaboration with the national carrier of Greenland Royal Arctic Line and an Icelandic shipping company has been approved by the Icelandic authorities.

As part of the cooperation, three 2,150 TEU container vessels are being built in China with expected delivery late 2019. Two vessel are being built for Eimskip and one for Royal Arctic Line.

The vessels will be used in weekly services between Greenland, Iceland, Faroe Island and Scandinavia. The cooperation is built on a well known practice in the shipping industry, VSA (Vessel Sharing Agreement), where capacity is shared between carriers.

The vessels will be the largest containers vessels that Eimskips has had in its service and are designed and built for the conditions in the North Atlantic, in accordance with the Polar Code. With the cooperation and larger vessels, economy of scale and increased fuel efficiency is reached with more environmental friendly vessel. Subsequently delivery of new vessels Eimskip foresees a sale of Goðafoss and Laxfoss.

In relation to the cooperation Royal Arctic Line will be able to offer transportation services to the Icelandic market. With the cooperation Greenland will be connected to Eimskip‘s international sailing system with its weekly services that creates opportunities for direct connections for Greenland to international markets.

Vilhelm Þorsteinsson, CEO Eimskip said: "We are pleased to have the formal approval from the Icelandic Competition Authority for the cooperation between Eimskip and Royal Arctic Line after several years of preparation."

Vilhelm added: "The cooperation creates opportunities for a more efficient sailing system for Eimskip as well as opening new sailing routes to and from Greenland enabling our customers to increase business with Greenland. It´s also important for Eimskip to renew its fleet with more efficient and environmentally friendly vessels, and is part of the company‘s journey towards increased profitability."

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