Recently, Euronav, one of the world’s leading independent tanker companies, reached an agreement to restructure its current orderbook. As a result, two Suezmax owned in JV by Euronav and its partner JM Maritime and one VLCC, (TBN Alsace) will be delivered in the first quarter of 2012, a Suezmax will be delivered in 1Q13 and the bulk of its related installments due in 2012 will also be postponed until the delivery of that ship.
Finally, the last Suezmax on order was cancelled against the forfeiture of the installments already paid which amount to USD 25.5 million. Euronav has also raised financing for all the ships to be delivered in the first quarter of 2012.
Consequently, the company’s capex in 2012 has been reduced to USD 146 million of which approximately USD 130 million is financed or deferred. In 2013, the capex amounts to USD 55.3 million for the delivery of the last Suezmax of which USD 40 million should be financeable.
Tanker Market:
The past year has been characterized by a fundamental oversupply of available tonnage affecting both the VLCC and Suezmax tanker market. Freight rates have remained well below breakeven levels and have frequently been insufficient to cover operating expenses. Crude oil demand growth has not been sufficient to offset the number of deliveries of tanker newbuildings, ordered prior to the global economic turndown, which have, and continue to be, delivered into the market.
The market has improved in recent weeks partly due to the forthcoming Chinese New Year. Also, the impending US and EU restrictions on importing Iranian crude oil which will impact in the third quarter, are causing receivers to start looking for alternative suppliers from elsewhere in the world possibly creating longer ton-miles. Fundamentally the market remains overtonnaged and the critical solutions for a more balanced market lies on the supply side. Older tonnage needs to be scrapped, orders need to be cancelled or at least delayed and consolidation of the market should help as well.
[mappress] World Maritime News Staff, January 19, 2012; Image: Euronav