Singaporean commodity trading company Trafigura Group has finalized the deal for the leasing of all 30 newbuilding ships announced back in June.
The 30 crude oil and product tankers were hired from an unidentified Asian financial counterparty, as at September 30, Trafigura said.
“A key event was a confirmed order placed by an Asian financial counterparty for initially 22 new-build crude and product tankers to be built in South Korea and China and to be leased to Trafigura on delivery with options to purchase at a later stage. Subsequently, eight optional ships have been confirmed,” Trafigura added.
The vessels will be built by Korea’s Hyundai Heavy Industries (HHI) Group and China’s New Times Shipbuilding.
The newbuildings will be hired for a period of 10 years bringing the contract value to USD 1.5 billion.
The ships are slated for delivery from the end of 2018 through 2019 calendar year, with the majority of vessels being delivered in the first quarter of 2019.
Separately a second-hand liquefied petroleum gas tanker was acquired under a long-term leaseback arrangement, which Trafigura said was also backed by a strong cargo programme and with potential ownership upside.
Despite taking direct control of this new tonnage, Trafigura explained that it will remain a major user of third-party vessels for many years to come.
“Looking ahead, we see the wet freight market remaining under pressure from continued over-supply during 2018 but expect to see that pressure starting to reduce as a number of older vessels are likely to be scrapped if the current freight environment continues,” the commodity group went on to say.