Tanker owner Frontline is reducing interest expenses through a new green loan with Dutch lender ING.
The John Fredriksen company said it has entered into a senior secured facility for up to $129.4m at “attractive terms”.
This will refinance an existing loan maturing in August this year.
The Oslo-listed owner’s chief financial officer Inger Klemp said the existing financing has a balloon payment of $80.1m remaining.
“We intend to use the expected net cash proceeds from the refinancing and from the sale of Front Njord to partially repay our $275m senior unsecured revolving credit facility,” she added.
The company announced the sale of the 156,000-dwt suezmax (built 2010) for $44.5m on Wednesday.
The existing loan facility carried an interest rate of the London interbank offered rate (Libor) plus a margin of 190 basis points.
The new financing matures over five years and has a coupon of the secured overnight financing rate (SOFR), plus a margin of 180 points.
The financing includes a margin adjustment linked to the fleet sustainability score.
Frontline said expanding and modernising its fleet remains a key part of its strategy.
The owner is committed to an investment programme including vessel acquisitions, newbuildings and retrofits involving low or zero-carbon fuel solutions.
It has taken delivery of six ammonia-ready VLCCs in recent months.
Ahead of emissions targets
The fleet consists of 91% eco vessels and has an average age of six years, making it one of the youngest and most energy-efficient in the industry, Frontline claimed.
“Despite turbulent European conditions, increased demand and high speeds throughout the market, the company’s modern and efficient fleet was able to maintain its emission intensity in 2022," the shipowner said.
The tankers outperformed the IMO and Poseidon Principles emission trajectories by 16.3% and 13.6%, respectively.
