Trio of VLCCs tipped for storage sales

Fredriksen and DHT tankers rumoured to be committed to storage buyers.

A trio of VLCCs owned by shipowners on Oslo’s waterfront are tipped to have been picked up by storage buyers.

TradeWinds reported last week that the emergence of storage buyers hunting ships of around 15 years old was breaking the deadlock in the S&P market.

Now, John Fredriksen’s Ship Finance International is rumoured to be selling two veteran VLCCs and DHT Holdings one.

Shipbrokers point to the 306,000-dwt Front Circassia (built 1999) and the 298,500-dwt Front Ariake (built 2001) being bought by a Russian company in a $50m deal. Sources suggest no transaction has been finalised.

“Should the price prove to be correct it is a slight firming in older tonnage as our combined valuation of the two vessels is in the range of $46m,” said Erik Nikolai Stavseth of Arctic Securities.

He explains the move would fit the Fredriksen group’s strategy of selling older tankers owned by Ship Finance International but operated by Frontline and buying newer vessels.

Strike two for Agritrade

Last Thursday we reported the 309,300-dwt DHT Chris (built 2001), owned by New York-listed DHT Holdings, was also attracting interest from storage buyers.

Now, Agritrade Resources is tipped to have taken the tanker in a $24m deal involving lengthy subjects.

It would mark Agritrade’s second VLCC purchase of the year after the 298,000-dwt Famenne (renamed Sea Horizon, built 2001) from Euronav.

For DHT a sale of one of its older tankers would make sense at a time when it is set to take delivery of its final newbuilding in a series of six from Hyundai Heavy Industries.

Scrapping by another name

Shipowning sources tell TradeWinds the sight of older VLCCs exiting the market into the hands of storage buyers is welcome.

They note an upturn in the spot market has led to an increase in enquiries from trading buyers and the interest among storage buyers is also on the rise.

However, selling to storage buyers is often preferable for tankers of this vintage as such deals have the same net effect as demolition, which are presently close to zero in the crude space.

"It’s better than selling to cash buying bottom-fishers who will turn around and undercut you in the Gulf,” one owner quipped.



Storage deal talk a tonic for VLCC shipowners

Speculation of one or more storage deals broke the impasse in the crude tanker sale-and-purchase (S&P) market this week — offering owners a respite from falling asset prices at time when a seasonal upturn in spot rates has arrived.

13 Oct 2016