A converted floating storage and offloading unit is said to have gone to a Russian buyer in what is believed to be the first sale of an Ocean Tankers-linked vessel.
Sale-and-purchase sources said an unnamed company has paid $18m for the 298,300-dwt Sea Coral (built 1996). The DSME-built vessel is registered under a company called An Zhong Shipping, which is believed to be a special purpose vehicle owned by oil-trading tycoon Lim Oon Kuin.
Also known as OK Lim, he is founder of the Xihe Group, as well as its Ocean Tankers and Hin Leong Trading affiliates that are now being restructured in Singapore courts.
Xihe Group acquired the Sea Coral in 2015 for a reported $19.8m. It converted the VLCC, then named Barnes, into an FSO.
Besides the FSO, the Lim family is also said to have sold two bunker vessels to TFG Marine, a new bunkering company created by Trafigura, Frontline and Golden Ocean. The names and prices of the ships have not been disclosed.
Ocean Tankers did not respond to emails from TradeWinds, and a Trafigura spokeswoman declined to comment.
The sales of the Sea Coral and two bunker ships come at a time when some shipping players had thought Xihe was discontinuing fleet sales.
“Over the last two weeks, we did not see the ships being circulated in the market and we thought Xihe has came up with a solution and is not selling them [the vessels],” said a shipowner representative in Singapore.
Some S&P players that TradeWinds spoke to voiced their frustration in pursuing Xihe’s vessels sales.
No guidance
One broker said he has found a buyer for one of the 43 tankers that are being circulated in the secondhand market, but he could not proceed with the S&P activity as he could not get hold of the vessel’s detailed specifications and no one was able to guide him on how and where the prospective buyer could inspect the ship.
Another S&P broker commented that Xihe’s fleet sales were unlike others that one sees in the market.
“It is a tricky one,” he said. “The Lim family is selling the ships to raise funds, but a number of the vessels have writs issued against them.
“Creditors, suppliers and banks of Hin Leong Trading and Ocean Tankers are putting claims against the fleet. Prudent buyers would likely refrain from acquiring vessels that have outstanding legal issues as they do not want to be caught in a long legal battle involving multiple claims.
“It remains to be seen what it [Xihe] can do and what it cannot do.”
Difficult market
One shipping player said Xihe was not lining up an inspection schedule for its ships because most are anchored out of Singapore, to prevent arrests and to take advantage of lower anchorage fees.
Meanwhile, Xihe’s fleet sales are being challenged by the downturn in the charter market, which will discourage investment in tankers.
“Selling tankers at this time will be difficult,” said the shipowner representative. “We can’t see how Xihe can sell the vessels en bloc. These days, not many owners have the financial means to purchase additional ships. We don't think Xihe can sell the tankers at the price it deemed fair.”
Early this month, a source close to Lim said Xihe’s fleet sell-off is not a fire sale. He said the move is to rightsize the fleet in an orderly fashion to meet expected future market demand.
