Nissen Kaiun will deploy a raft of on-order aframax tanker newbuildings into the fleet of N2 Tankers, a pool-like joint venture between the Japanese shipowning giant and Reederei Nord.

The four or five aframaxes, being built at Japanese yards for delivery from 2025 onwards, will replace existing ships owned by Nissen Kaiun and subsidiary companies in the N2 Tankers fleet, its director Madhu Vadakkepat told TradeWinds in an exclusive interview.

That Nissen Kaiun, a traditional tonnage provider until the establishment of N2 Tankers six years ago, has committed these newbuildings is taken as a vote of confidence in the aframax operator’s strong performance, according to Vadakkepat.

“I don’t have the habit of comparing ourselves with our competitors or peers, but I do get reports from other parties and I do a benchmarking every six months. I am happy to say we’ve quite reasonably compared on the revenue side of things and, by and large, our performance has been really exciting,” he said.

Nissen Kaiun director Kotaro Abe agreed.

“Both owners and the charterers are notably quite satisfied, especially as the fleet is operated and managed with quality,” he said.

N2 Tankers, which has chartering teams in Singapore and Amsterdam, currently controls a fleet of 11 aframaxes that are divided almost equally between the Atlantic and Asia. The Dutch office handles ships west of Suez, while Singapore takes over when they head east.

Reederei Nord’s in-house ship-management team handles the technical management of its owned vessels, while Synergy Marine provides the technical management for Nissen Kaiun’s ships.

Although the company follows a pooling model, Vadakkepat is loath to call it a pool.

“It is a pool-like system but essentially it is an owners’ platform. We have never behaved like a third-party pool manager. That is our winning stroke with charterers. They know they are talking directly to the owners and not some other manager who is handling the ship on behalf of the owner,” he said.

The two N2 Tankers shipowning partners are eager to bring in fresh faces to expand the business.

“The team in Singapore and Amsterdam are managing this with a high level of professionalism, using the best technology in management, which makes this model all the more interesting. We are keen that like-minded owners join as partners as we continuously look to grow our fleet,” Abe said.

One vision

Vadakkepat stressed that any new partner must share the same vision.

“It has to be a complete partnership with everyone working together to make this work in a bigger way. This is the ideology we are following. We don’t want a partner who outsources everything to us and asks for the money,” he said.

Fleet renewal: Nissen Kaiun plans to sell the aframaxes it deploys in the N2 Tankers fleet, including the 108,500-dwt Pusaka Java (built 2018), replacing them with newbuildings

The reason N2 Tankers is keen to grow its fleet is because of the increasing demand for its ships from charterers.

“We do have quite a number of contracts of affreightment commitments to meet, and as we have built the N2 Tankers brand successfully as a boutique aframax shop, we are increasingly gaining the confidence of charterers,” Vadakkepat said.

The company mainly fixes its ships out on the spot market, where he said they are proving popular with “a good group of charterers”.

One charterer, he added, recently did 26 back-to-back spot fixtures. Another fixed about 20 vessels in the space of six months.

However, even though demand is on the increase, Nissen Kaiun is keen to sell the four aframaxes it currently deploys in the N2 Tankers fleet. These ships were built in 2018 and 2019 and are reaching the age at which the shipowner prefers to sell tonnage so that it can cash in on a good asset play.

In early July, there were widespread reports that an N2 Tankers fleet member, the 108,500-dwt Pusaka Java (built 2018), a ship owned by Nissen Kaiun’s Singapore-based shipowning affiliate Pusaka Laut, had been or was in the process of being sold for $68.5m.

Singapore-based Eastern Pacific Shipping was named as the buyer, although the Idan Ofer-led company denied any deal had been done.

While Vadakkepat denied knowledge of the sale, claiming N2 Tankers had not received any notice of withdrawal, he conceded that the four aframaxes will likely be sold off ahead of the delivery of the replacement newbuildings.

“Why wouldn’t they do that? It’s not just the age factor alone. It’s just how the market is swinging in terms of S&P rates. We have the newbuildings in place, so it makes more sense to have that cash put into the newbuildings,” he said.

N2 Tankers, he revealed, is actively looking to take modern aframaxes on long-term charter to fill any gaps in its fleet, as well as to facilitate immediate growth.

“There is a void in the middle, where we need to fill in the gaps before the newbuildings turn up. We’re looking at chartering very modern, eco-friendly aframaxes.

“I would say it is pointless to fix supplementary ships on the spot market or for just a year. It is better to have a ship that is under our control, for us to utilise for a longer period, probably two to three years,” Vaddakapet said.

Additional vessels could also come from shipowners who want to join N2 Tankers as a partner.

“That would be a great story also,” Vadakkepat concluded.