News bulletin – tanker shipping

NEWS BULLETIN

TANKER SHIPPING

STOLT SWOOPS FOR QUINTET

Stolt Tankers has agreed to acquire five chemical tankers from Chemical Transportation Group (CTG). The five, all of 26,000 dwt with some stainless steel tanks, were built in China in 2016/17 and will join the Stolt Tankers Joint Service. The acquisition is expected to close between December 2020 and February 2021; the terms of the deal have not been disclosed.

“This acquisition is an excellent opportunity for Stolt Tankers to replace ships being retired in the next few years, lowering our fleet age profile with competitively priced ships that can trade in any of our deep-sea lanes,” says Lucas Vos, president of Stolt Tankers. “Newer, fuel-efficient ships help us reduce our carbon footprint while buying existing tonnage means capacity is not added to a market that doesn’t need it. In a cyclical industry like ours, buying the right ships at the right price is the path to financial sustainability. In the end, Stolt Tankers’ customers are the real winners in this deal, as these ships will support our proven platform that provides a high quality, reliable and flexible service offering.” www.stolt-nielsen.com

BIG ORDER FROM BAHRI

Bahri has ordered ten 49,999-dwt chemical tankers from Hyundai Mipo Dockyard (HMD) as part of its ongoing fleet expansion and renewal programme. Bahri says the new ships will be built to the highest environmental, fuel efficiency and safety standards in line with its commitment to operating responsibly.

“As a company committed to contributing to Saudi Arabia’s maritime goals set out in Vision 2030, Bahri has always remained keen on the continual enhancement of its enormous fleet of state-of-the-art multi-purpose vessels,” says CEO Abdullah Aldubaikhi. “The new agreement with HMD for the building of 10 high-spec chemical tankers represents a major step forward in our next phase of growth and further strengthens our leading position in the global maritime industry.”

The contract is worth $410m; deliveries are due to start in early 2022. HMD has already built more than 50 vessels of various types for Bahri. www.bahri.sa

VLEC ORDER DOUBLES

Zhejiang Satellite Petrochemical has doubled its order for 98,000-m3 very large ethane carriers (VLECs) to 12, with six additional orders for 2022 delivery. It has extended its existing order of three vessels at each of Hyundai Heavy Industries and Samung Heavy Industries to five, while Tianjin Southwest Maritime will provide a further two under 15-year timecharters. These will be built at Jiangnan Shipyard in China.

The first six orders were recently sold to MISC Bhd for $726m under a sale and leaseback deal and it is likely that the four new direct orders will seek similar arrangements. Satellite Petrochemical is the largest producer of acrylic acid in China and use the ships to transport ethane from the US to its new cracker in Lianyungang, due to open later this year. www.satlpec.com

FIRST OF EIGHT FOR AURORA

Aurora Tankers has launched Maritime Comity, the first of eight 49,000-dwt newbuildings at the CSSC yard in China. The zinc-coated IMO II tanker is fitted with an exhaust gas scrubber and nitrogen inert gas system to ensure longer life of the tank coating and easier cleaning. The design maximises cargo loads with low specific gravity and offers a shallow draft to maximise trading flexibility. Delivery of the remaining vessels in the series will run to the end of 2021.

“Aurora Tankers’ first newbuilding in this series of eight supports our strategy of growth and will continue to improve our service offering to our customers. The series will be operated in our Aurora Tankers pool, strengthening our position as a leading IMO 2 MR operator,” says Frederik Guttormsen, senior director, shipping at IMC Industrial Group, parent company of Aurora Tankers. “We appreciate CSSC Shipping and their efforts in the completion of this first delivery during these challenging times caused by the Covid-19 pandemic. We are looking forward to further strengthening our partnership in the years ahead.” Imcindustrialgroup.com

GOOD TIME FOR EXMAR

Exmar has reported revenues of $135.4m for the first half of 2020, up from $99.5m a year ago, with EBITDA up by 44 per cent at $69.7m. Higher depreciation and impairment

losses, largely arising from the Tango FLNG unit, held operating profit growth back, rising from $16.4m to $19.2m but the net result moved into profit this year.

Exmar benefitted from much stronger earnings from its midsize and VLGC gas carriers, despite the drop in VLGC rates during the second quarter, and describes the first six months of the year as “one of the best semesters in recent years”. The pressurised fleet did less well and Exmar says it expects this sector of the market to remain under pressure through to the end of 2021. exmar.be

BOOST FOR BW

BW LPG has reported a second quarter net profit of $62.1m, well up on last year’s $26.5m, although VLGC freight rates slipped somewhat after the highs of the first quarter. Vessel utilisation remained high at 97 per cent. EBITDA rose by 52 per cent to $113.1m, with the after-tax profit rising from $26.5m to $62.1m.

Since the end of the quarter, the market has recovered strongly, BW LPG says, with rates hitting more than $50,000/day in early August. Looking ahead, a weaker outlook for US LPG supply together with a relatively high number of newbuild deliveries are expected to put downward pressure on vessel utilisation.

Despite the market uncertainty, BW LPG is pressing ahead with the retrofitting of LPG dual-fuel engines on 12 of its existing vessels during 2020 and 2021; BW Gemini and BW Leo are currently in drydock having the work done. “Retrofitting provides significantly more environmental benefits compared to newbuildings, as confirmed by DNV, and boosts an already efficient and clean fleet without adding capacity,” the company says. BW LPG is collaboration with Hafnia on bunker procurement for the ships. www.bwlpg.com

AVANCE WARY OF VOLATILITY

Avance Gas Holding has reported second quarter timecharter equivalent earnings of $35.3m, down from $44.1m in the first quarter after a sharp decline in VLGC freight rates. Net profit dropped from $15.1m to $6.7m. Avance notes that demand has returned to a more normal level in the third quarter, which has boosted the freight market. However, US LPG exports remain volatile as a result of unfavourable price differentials between the US and Asia, while Middle East exports have dropped in line with oil production cutbacks.

Petrochemical demand in Asia has started to normalise after Covid-19-related shutdowns and Avance remain optimistic that VLGC demand will benefit from an increase in propane dehydrogenation (PDH) activities in China. www.avancegas.com

CHARTERS SUPPORT STEALTHGAS

StealthGas has reported second quarter voyage revenues of $36.3m, up by $2.2m on the year-earlier figure after higher timecharter rates and more vessels working in a strong spot market. Net income of $8.9m was the company’s best return since the start of 2013 and EBITDA was up by almost 50 per cent on second quarter 2019 at $21.8m.

“In spite of the global turmoil the Covid-19 pandemic has brought on, StealthGas exerted a very strong performance in the second quarter of 2020,” says board chairman Michael Jolliffe. “The pillars of our success were principally our strong period coverage secured ahead of the imposed lockdowns, our stable operating cost base and the lowering of our finance costs. Going forward we will strategically navigate the tides of the Covid-19 pandemic, pursuing the best course of action amidst what may prove to be difficult market conditions.” www.stealthgas.com

TEAM STEAMS AHEAD

Team Tankers International has reported second quarter EBITDA of $21.7m, up from $16.5m in the first quarter and $11.8m a year earlier. Average timecharter equivalent earnings rose from $13,812/day in the first quarter to $14,667/day.

“We executed the strategic commercial cooperation with Maersk Tankers and commenced the joint venture with V Group for technical management, building commercial and operational scale for our tanker fleet,” notes CEO Hans Feringa. “The two partnerships have improved trading performance, reduced costs and increase our flexibility for additional divestment and investment activity.” teamtankers.com