Norwegian shipping and tank terminal company Odfjell has signed a letter of intent with China’s Hudong-Zhonghua Shipbuilding for two additional chemical tankers with stainless steel cargo tanks at a cost of about $116 million.

The vessels have a deadweight (dwt) of 38,000 with 40 tanks and a cargo capacity of about 45,000 cubic meters. The Chinese yard is already building four 49,000 dwt vessels with 33 stainless steel tanks for Odfjell. The Bergen-headquartered group said the yard is one of the very few Chinese construction companies able to meet Odfjell’s quality standards for building advanced chemical tankers.

This latest order follows two long-term charter agreements announced in February and March as well as the purchase of the chemical tanker Bow Architect. Earlier this month, Odfjell said it had concluded bareboat charter agreements for two 36,000 dwt chemical tankers with 28 stainless steel cargo tanks. The vessels will be built at an unnamed Japanese shipyard and be delivered in Q4 2019 and Q2 2020. The agreements will run for a minimum of 10 years. Odfjell CEO, Kristian Mørch, said the charter agreements were a capital efficient way to achieve part of its tanker replacement program and growth targets.

Odfjell has also paid about $16.7 million to exercise its purchase option for the Bow Architect, a 30,000 dwt stainless steel chemical tanker with 28 cargo tanks that was built in 2005, since when it has been on long-term charter to the Norwegian shipper.

Last month, Odfjell entered into another long-term charter agreement for two 35,500 dwt stainless steel chemical tankers to be built at Japan’s Shin-Kurushima dockyard. The charter agreements will run for a minimum of eight years and the vessels are due for delivery in Q4 2018 and Q1 2019.

The agreements and the Bow Architect purchase are part of Odjell’s Compass growth strategy, which it launched last month. The initiative includes a focus on fleet growth with a target of operating a fleet of about 100 vessels as well as achieving average annual long-term revenue growth of 10%. At present, Odfjell is reported to operate a fleet of 77 ships, which includes 75 chemical tankers and two gas carriers.