Sovcomflot Inks USD 252 Mn Financing for Six Aframaxes

Signing ceremonyImage Courtesy: Sovcomflot

Russian shipping major Sovcomflot (SCF Group) has signed a new USD 252 million credit facility to finance a series of six Aframax tankers.

The tankers, which were purpose-designed to be powered by liquefied natural gas (LNG), are currently under construction and due for delivery from the third quarter of 2018 to the second quarter of 2019.

The 7-year credit facility was agreed with a consortium of six banks, including ABN AMRO Bank, BNP Paribas, Citibank, ING Bank, KfW IPEX-Bank and Société Générale.

Each 114,000 dwt tanker will have an ice class 1A hull, enabling safe year-round export operations from regions with challenging ice conditions, such as the Baltic. Two vessels will work exclusively for Shell under time-charters for up to ten years, while Shell will also provide LNG fuel for all the six tankers in the series across North West Europe and the Baltic.

SCF said that the credit facility benefits from a favourable long-term tenor and competitive pricing, reflecting the robustness of the deal structure as well as the ability of the company to raise capital internationally under all market conditions.

“This is the second successful debt financing accomplished by SCF Group in 2018, which now allows the company to address in full its financing requirements for the newbuilding programme of 2018-2019,” Nikolay Kolesnikov, Senior Executive Vice-President, Chief Financial Officer of SCF Group, said.

SCF informed that these vessels set new environmental standards for the global tanker industry through adopting cleaner-burning LNG as a primary fuel for Aframax tankers.

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