Transportation Recovery Fund (TRF) has made its first direct investment in aframax product tankers, joining the orders rush that has taken hold of the ship type this year.
Shipbuilding sources said TRF has contracted China’s Jiangsu New Hantong Ship Heavy Industry to build three 115,000-dwt product carriers to be delivered in 2025. It was not known if the deal includes any optional ships.
Officials declined to comment on Jiangsu New Hantong’s shipbuilding activities, citing contract confidentiality. But they said the shipyard is in discussions with a few companies over tanker newbuildings.
Shipbuilding sources believed TRF is paying in excess of $62m each for the aframax product carriers.
TRF was launched in March 2013 and was backed by WL Ross & Co — the New York-based private equity firm founded by Wilbur Ross and now controlled by publicly listed Invesco.
The fund’s shipping business is run by Fearnleys-linked TRF Ship Management in Oslo. TRF Ship Management chief executive Michael Aasland was not available for comment.
According to Clarksons’ Shipping Intelligence Network, TRF has a fleet of 18 tankers — two VLCCs, three LR1, 12 chemical tankers of between 19,900 dwt and 37,300 dwt — as well as one 3,500-teu container ship.
Shipbuilding sources said the last time TRF ordered newbuildings was in late 2014, when it commissioned New Times Shipbuilding in China to build two suezmax tankers.
There has been a dash in orders for aframax product carriers at Chinese shipyards.
TRF is believed to be the 10th company to have invested in LR2 tanker newbuildings this year.
Clarksons says 34 LR2 tankers were ordered between January and April this year, while only 21 ships were booked in the whole of last year and 17 in 2021.
Some tanker players believe LR2 prospects are on the up because the market is set to benefit from Russian oil sanctions.
Ralph Leszczynski, Banchero Costa’s global head of research, said the trend in recent years has been that long-haul clean products trades have been growing as refining capacity has expanded in India and the Middle East, with new modern export-oriented refineries, while older refineries in Europe, Australia and South Africa have closed as they have become financially uncompetitive.
Maran Tankers, Zodiac Maritime, Eastern Pacific Shipping, Union Maritime, Tai Chong Cheang Group, Dynacom Tankers Management, Thenamaris and Capital Maritime & Trading are among the companies that have ordered the ship type this year.
Greek shipowner Dynacom has booked the most, having ordered 10 firm vessels plus options for an additional four ships at DSIC Shanhaiguan Shipbuilding Industry Co — a subsidiary of Dalian Shipbuilding Industry Co.
The strong demand for LR2 tankers has allowed Shanghai Waigaoqiao Shipbuilding to revive Shanghai Shipyard, which delivered its last vessel in 2019. The yard was reported to have closed down due to a shrinking orderbook and environmental issues, with some observers saying it would relocate from its site on Chongming Island to Changxing Island, as China wants to transform Chongming into a “green garden island”.
Privately owned Jiangsu New Hantong started off by building supramax bulk carriers and has since delivered capesizes.
VesselsValue shows that the shipbuilder delivered two LR2 tankers and two aframax crude carriers to George Economou’s TMS Tankers between 2018 and 2019.
