Knutsen NYK Offshore Tankers (“KNOT”) has received a notice from a subsidiary of BG Group plc that BG has exercised its option for an additional Suezmax-size DP2 shuttle tanker newbuilding for operation in Brazil.
In connection with the September 12, 2014 contract between KNOT and BG for two Suezmax-size DP2 shuttle tanker newbuildings, BG received an option, for a period of one year, to take up to two more shuttle tanker newbuildings. Following the current exercise of its option for an additional vessel, BG has a remaining option for one more shuttle tanker.
The new vessel will be constructed by Hyundai Heavy Industries (HHI) in South Korea, as are the first two vessels.
Upon delivery, expected to be in mid-2017, the vessel will start operations under a time charter with BG (this will have a minimum term of 5 years). If BG exercises all extension options, the vessel would operate under this charter for a period of 20 years.
KNOT currently owns eight shuttle tankers, which are vessels designed to transport crude oil and condensates from offshore oil field installations to onshore terminals and refineries.