The deal takes effect from the third quarter of this year and is expected to produce minimum annual revenues of SAR 250m ($66.65m) so will be a huge earner over ten years bringing in an estimated total of $666m.
Bahri said it expected the financial benefits to flow immediately the physical shipping deal commences.
The Saudi shipping concern has done substantial spot voyage chartering business with S-Oil for many years with the COA building on this relationship.
“The contract forges a new and increased level of relationship between the two companies,” said Bahri. “S-Oil will benefit from the flexibility and quality operations that the Bahri VLCCs bring to this partnership, while Bahri VLCCs will have continuous access to AG/East bound cargoes creating additional diversity of employment routes and the ability to further optimize fleet utilization.”
Bahri, majority owned by Saudi state interests, took over Vela in 2012. The merged venture owns and operates 32 VLCCs, 24 chemical carriers , six ro-ros and five bulk carriers.
