A Hoegh Autoliners car carrier that suffered a fire in Florida earlier this year has been declared a constructive total loss, Ocean Yield has confirmed.
The 4,900-ceu Hoegh Xiamen (built 2010) caught fire on 4 June at the Blount Island Marine Terminal in Jacksonville.
It took eight days for the blaze to be extinguished by the Jacksonville Fire and Rescue Department and a firefighting team and specialist tugs from salvor Resolve Marine.
Ocean Yield said it expects to receive insurance proceeds of about $26m in the third quarter of 2020, which is said to be close to the book value of the vessel.
The net cash proceeds after repayment of debt related to the vessel will be about $8m, the Oslo-listed ship leasing company confirmed.
Danske Bank analyst Anders Redigh Karlsen said: "We view this as positive as it reduces some exposure to the car carrier market, in particular the residual risk, chartering and counterparty risk associated with this vessel."
He added that he does not expect any major impact on the share price on Monday, "but the outcome is marginally positive in our view".
The stock rose 2.5% to NOK 22.60 in early trading in Oslo.
TradeWinds reported last month that Norwegian marine insurers will have to foot a large slice of an escalating bill for the blaze on the Hoegh Xiamen.
Arendal-based Gard is the protection and indemnity cover provider for the vessel and is also listed among the ship’s hull insurers.
Meanwhile, the Norwegian Hull Club, which is headquartered in Bergen, is the lead claims handler for the vessel’s hull insurance.
The Hoegh Xiamen was on a “hell and highwater” bareboat charter to Hoegh Autoliners at an undisclosed fixed day rate until June 2022.
Ocean Yield has three other PCTCs on bareboat charters to Hoegh — the 4,900-ceu Hoegh Beijing (built 2010) until June 2022 and the 6,500-ceu Hoegh Jedda and Hoegh Jacksonville (both built 2014) — until April and August 2026, respectively.
At the time of the incident, the Hoegh Xiamen was being operated via charter by Grimaldi Group to carry a cargo of secondhand cars to Africa.
The fire started on cargo deck number 7 and spread to “several" others, according to Hoegh. Internal temperatures in the cargo holds were reported to be up to 260C.
