It just looked like a Scorpio Tankers deal.
While broker reports have noted the fixture of the 109,900-dwt STI Lily – the STI prefix typically denoting a Scorpio tanker – for 36 months at a robust $40,000 a day, it won’t be Scorpio that is reaping the benefit.
Selling ships, buying stock
Scorpio earlier this month confirmed it had sold the 2019-built LR2 to unidentified buyers for a strong price of $73.5m.
So while the tanker has not yet been delivered, it is understood to be the buyers — whom TradeWinds has identified as Indonesia’s Pertamina International Shipping — who have secured the three-year deal with a charterer identified as Singapore-based tanker operator Elite Tankship.
“It’s a very strong rate,” said one market source. “It looks to be a primary reason they were able to pay that price for the Scorpio ship. At that rate they will be generating $10m-$11m in cash flow per year.”
Scorpio Tankers president Robert Bugbee declined on Friday to comment on the fixture, other than to note that Scorpio confirmed on 1 October that the vessel has been sold.
He characterised charter enquiry for period fixtures on LR2s as “good and I think building as we’re heading into the stronger winter season” but explained that it’s not business Scorpio is particularly seeking at this point for its own strategic reasons.
“We’ve chosen to selectively sell vessels, buy back stock and delever, so we’re not desperate to do time charters,” Bugbee said.
That is not to say that Scorpio rules them out, but the circumstances would have to be right.
“We’re always willing to work with strategic partners,” Bugbee said. “If a strategic partner were to approach us with that type of requirement, we’d certainly listen.”
Scorpio Tankers has a fleet of over 100 ships on the water. At the time it confirmed the STI Lily sale, it was one of 39 LR2s in its trading fleet, according to data on its website.
Scorpio did in early September go long on one of its MR tankers with impressive results.
As TradeWinds has reported, Scorpio clinched a record charter rate, booking the 50,000-dwt STI Jardins (built 2018) for three years at $29,950 per day.
That fixture equates to $32.8m over the full period and is believed to be the best-ever such rate for a non-scrubber eco MR, market sources told TradeWinds.
