Torm has sold one its oldest vessels as part of the Danish product tanker giant’s fleet renewal.
Sources familiar with the deal told TradeWinds the 100,000-dwt Torm Kristina (built 1999) was sold to a Middle Eastern company for about $10m.
The Denmark-flagged long-range tanker was constructed by now-defunct South Korean shipbuilder Halla.
The price for the tanker exceeded market expectations. VesselsValue estimates the ship is worth $6.5m and Maritime Strategies International puts its value at $9.1m.
TradeWinds understands the tanker was sold for further trading, rather than for scrap.
According to a London-based broker, the high price may have reflected that the Torm Kristina will not have to undergo a special survey until 2024.
“When a ship passes the 20-year mark, the value flattens and the way you really weigh the ship is about its dry-docking position,” the broker said.
“A 1999-built can be worth more than a 2000-built.”
A Torm spokesman said the company does not comment on individual vessel transactions.
Following the sale, the only 1990s-built vessel remaining in the shipowner’s fleet is the 100,000-dwt LR2 Torm Helene (built 1997).
Torm’s stated policy is to maintain and renew its fleet continuously in the most profitable manner, through either secondhand deals or newbuilding contracts. The company is listed on Nasdaq’s Copenhagen and New York exchanges.
According to is website, Torm has taken delivery of four LR2s, two LR1s, and seven MRs since 2018. It is due for another LR2 tanker from Guangzhou Shipyard International in 2021.
In contrast, Torm sold five vessels with an average age of 18 years in 2019, following four offloaded in the previous year.
In a recent podcast, Torm chief financial officer Kim Balle suggested operational issues as a result of the Covid-19 crisis were curbing liquidity in the secondhand market.
With travel restrictions across the globe to prevent the spread of coronavirus, crew changes and physical ship inspections remain difficult for shipowners, according to industry observers.
