However, MEG/East rates held up with earnings around $70.000 per day, reported Fearnleys. During the last few days, the market appeared a little softer and with a number of ships previously taken on period being marketed for spot business, it could change the scene somewhat, the broker warned.
Available Tonnage is therefore building up and the list looks longer than for quite some time. As a result, charterers with upcoming business have taken a step back to test owners rate resolve.
In the meantime, there is still continued interest for period business, while Caribbean/East rates remained at a record high on thin availability and ships discharging on the Continent were quickly fixed for voyages back to the East at healthy numbers.
Suezmaxes loading West Africa to Western destinations softened last week. However, with activity again picking up, we could be close to the bottom on rates for cargoes ex West Africa for the time being, Fearnleys said.
In a boost to Nanjing Tanker, the tanker shipping arm of Sinotrans & CSC, the company signed a strategic agreement with CNOOC Taizhou Petrochemcial after being selected as the shipping partner for the project.
According to Sinoship News, CNOOC commenced the construction of the Taizhou plant in 2012 with an investment of RMB10.2 bill.
The project will produce feedstock oil for petrochemicals, LPG, fuel oil, as well as lubricants and is expected to start operation in the second half of this year.
In other chartering news, broking sources thought that at least eight large tankers had been taken on period charters for storage projects.
Four VLCCs were said to have been fixed for two year periods. These included the 2011-built ‘New Joviality’ and the 2003-built ‘Olympic Legend’ reportedly fixed to Shell at $42,500 per day each and the 2004-built ‘Elizabeth I A’ and the 2008-built ‘New Medal’ both believed fixed to BP at the same rate.
Trafigura was said to have taken the 2011- built VLCC ‘Cosglad Lake’ for 12 months at $45,000 per day, while Clearlake was believed to have fixed the 1998-built ‘Front Century’ for 12 months at $42,500 per day for a storage project.
Elsewhere, Koch was said to have taken the newbuilding Suezmaxes ‘Istanbul’ and ‘Atina’ for 12 months trading at $29,500 per day each.
Two LR1s were reported fixed for 12 months each recently. The 2004-built ‘Neptun D’ was taken by Morgan Stanley at $17,500 per day, while the 2011-built ‘SCF Pioneer’ was said to have been chartered to ATC at $17,650 per day.
In the S&P sector, NewLead holdings has confirmed that it has purchased five more bitumen tankers. The company has expanded its fleet to 10 vessels over the last year, it said.
Three bitumen tankers, ‘Captain Nikolas I’, ‘Nepheli’ and ‘Sofia’, were purchased for $21 mill in total and will be paid for through a combination of equity and debt financing. The other two tankers, ‘Ioli’ and ‘Katerina L’, were committed on the back of two separate bareboat/lease agreements, the company said.
NewLead explained that it has the option to purchase the latter two vessels during the lease contracts for an aggregate purchase price of around $6.05 mill. The company will make a payment of around $4.23 mill for the ‘Ioli’ and the ‘Katerina L’ when they are delivered.
The gross earnings from the employment of all five vessels is expected to be $12.65 mill per year. All five vessels will generate an aggregate of around $5.61 mill of EBITDA per year, the company said.
Chairman and CEO of NewLead, Michael Zolotas said: “NewLead continues to deliver on its commitments to create value for its shareholders and grow its fleet, while improving the age profile as well as their tradeability, increasing the cash flow, as well as the revenues of the company. Today, NewLead’s average fleet age is 7.39 years, compared to 17.84 years at the beginning of 2014.
“NewLead invested in young, high quality sophisticated bitumen tanker vessels to capture opportunities in emerging economies and niche markets with relatively low competition. NewLead's long term relationships with oil majors and fuel oil companies will allow responsiveness to market opportunities, as well as support its commitment to continue to grow its fleet," he concluded.
Other sales on brokers’ lists this week included the 2005-built Aframax ‘Al Muminah’ to Norwegian interests for $31 mill. She underwent her special survey in drydock recently.
Far East interests were said to be behind the purchase of the 1995-built MR ‘Kandilowa’ for $8.3 mill.