Norway-listed Navig8 Chemical Tankers has axed a number of management agreements with its co-owner, Navig8 Group, but retains substantial working relations with its parent.

The Denmark-based chemical carrier company's annual report revealed a change to commercial, technical and administrative management ties with Navig8 Group.

The shipowner pays Navig8 Group a pro-rata share of revenue — amounting to 2% plus a fee of $250 per vessel per day — for ships commercially managed by Navig8 Group pools.

In addition, Navig8 Chemical pays $500 per vessel per day for technical management, and $220 per ship per day for administration.

Navig8 Chemical said it has now changed the technical manager for four vessels, the commercial manager for 10 ships and terminated the administration deal altogether.

Chief executive Jens Gronning told TradeWinds: "We have indeed implemented a few changes over the past 18 months, all with the aim of further diversifying our commercial and technical set-up and streamlining our organisation."

Navig8 Chemical was founded in 2014 as a joint venture between tanker owner Navig8 Group and giant US fund manager Oaktree Capital Management.

Jens Gronning is chief executive of Denmark-based Navig8 Chemical Tankers. Photo: Navig8 Chemical Tankers

The two shareholders clashed in 2019 over financial performance and the breakdown of Interline 9001 coatings on at least some of the fleet’s tankers.

Oaktree brought Gronning in as chief executive to replace Navig8 Group principal Nicolas Busch.

TradeWinds reported a deal was then reached for Navig8 Group to continue to manage all 24 of Navig8 Chemical's coated chemical tankers for a minimum of 24 months.

New pool deals

Gronning confirmed the change in commercial management related to four 25,000-dwt stainless-steel vessels placed into an Odfjell-managed pool, as well as the later transfer of six coated MRs into Odfjell's new coated pool.

Gronning also said five vessels were placed under the technical management of Norwegian operation OSM's newly established Copenhagen office in Denmark.

"In addition, we retained a new external service provider in order to transfer our back-office functions into an independent set-up that is more closely aligned with the requirements of our organisation," Gronning said.

He explained these were all measures aimed at optimising the existing business, "rather than a wholesale change of strategy or the way we operate".

Constructive relationship

Gronning said he is not familiar with the coated tanker management agreement from 2019.

But he added: "We continue to maintain a substantial and constructive business partnership with the Navig8 Group through their commercial management of our 18 38,500-dwt handysize units and the technical management of a substantial part of our 32-vessel strong fleet."

As of 31 December, the 18 handysizes remained in Navig8's Alta8 pool.

The company paid a working capital fee of $300,000 for every vessel that entered the pool. This is refundable when the ship exits.

In 2020, the company recognised $107.9m of pool revenue, up from $163m in 2019. Of this, $75.1m related to the 18 Alta8 vessels.