Knutsen NYK Offshore Tankers (KNOT) has reported that it fell into the red in 2019.
But the leading shuttle tanker operator is optimistic for the market going forward.
“It is stable and good, and the contracts are renewed even in these turbulent times,” finance director Oystein Emberland told the Norwegian financial daily Finansavisen.
All the company’s tankers are employed in a firm market, and the company has had to hire additional tonnage to cover its contract commitments.
The pre-tax result dropped to a $5.2m loss in 2019, reversing a profit of $25.7m in the prior year.
KNOT had operating revenues of $263m last year, up from $218m in 2018.
Last year KNOT, as well as its 27.8%-owned New York-listed spin-off KNOT Offshore Partners, reported unrealised losses on derivatives.
Haugesund-based KNOT also had huge costs on the conversion of the 123,000-dwt tanker Hanne Knutsen (built 2000) to a storage vessel at Remontowa Shiprepair Yard in Gdansk, Poland.
The total conversion cost amounted to $350m.
Last year Hanne Knutsen had a full operating year at the Martin Linge field in the North Sea, where it carried out work for Equinor.
At the end of 2019 the company’s book equity totalled $500m or an equity ratio of more than 40% and a cash reserve of $86m.
KNOT owns a fleet or 12 shuttle tankers and two storage tankers for crude oil.
One of its ships, the 46,000-dwt shuttle tanker Dan Eagle (built 1999) was last year sold for demolition.
In addition, KNOT Offshore Partners has a fleet of 16 shuttle tankers that all are on long-term charter to oil companies.
KNOT also has six shuttle tankers on order at different shipyards in China and in South Korea, against long-term charters.
In February, TradeWinds reported that KNOT had signed up for two LNG-fuelled shuttle tankers priced at $141m each at South Korean shipbuilder DSME. These 124,000-dwt tankers are fixed for up to 10 years to Italy’s Eni. Delivery is scheduled for mid 2022.
KNOT is owned on a 50-50 basis by shipowner Trygve Seglem and the Japanese partner NYK Line.
