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Overview of KNOT Offshore Partners LP (KNOP)
KNOT Offshore Partners LP (KNOP) is a publicly traded master limited partnership strategically positioned in the offshore oil logistics industry. Operating in the high-stakes environmental settings of the North Sea and Brazil, the company specializes in owning, operating, and acquiring shuttle tankers under long-term charters. By delivering reliable crude oil loading, transportation, and storage services, KNOP addresses the pivotal need for safe, efficient oil transport in challenging offshore regions. Keywords such as shuttle tankers, long-term charters, and crude oil transport underpin its day-to-day operations, reflecting its core business model and operational focus.
Business Model and Operational Dynamics
At the heart of its business, KNOP operates through a fleet of shuttle tankers that are chartered on long-term arrangements, ensuring a steady flow of revenue while mitigating market volatility. The company utilizes both time charter and bareboat charter agreements, offering flexibility in how vessels are operated and managed. This model not only provides operational stability but also enhances the overall asset utilization, making the fleet a key strategic asset for the partnership.
These long-term agreements enable KNOP to secure predictable cash flows, even as the broader oil market experiences fluctuations. The focus on shuttle tanker operations positions KNOP in a niche yet vital segment of offshore logistics, where precision, safety, and adherence to international maritime standards are paramount.
Strategic Partnerships and Support Structure
One of the defining features of KNOP's operational strategy is its close association with its sponsor, Knutsen NYK Offshore Tankers. This sponsor is itself the product of a joint venture between two globally diversified shipping powerhouses -- the Knutsen Group and the NYK Group. This relationship provides KNOP with critical material support across operations, administration, and business development. The deep industry expertise and global reach of its sponsors empower KNOP with advanced navigational support, capital investment insights, and operational best practices.
The alignment with such established industry players not only ensures that KNOP benefits from proven methodologies in vessel management but also reinforces its ability to navigate the complexities of the offshore oil transportation market.
Market Position and Competitive Landscape
Operating exclusively in the shuttle tanker segment, KNOP maintains a specialized niche not frequently penetrated by general tanker operators. Its operational focus in well-established oil production regions like the North Sea and Brazil means that the company is deeply embedded in markets known for their operational complexities and high regulatory standards. Shuttle tanker operations involve meticulous planning and strict adherence to environmental and safety regulations, which KNOP manages through robust operational protocols and industry best practices.
Within the competitive landscape, KNOP differentiates itself through its stable long-term charter business and strategic sponsor support. While competitors may offer diversified shipping services, KNOP’s targeted operational model and strategic infrastructure provide it with a distinct value proposition in the marine fuel transportation sector.
Operational Excellence and Risk Management
KNOP operates in a high-risk yet critical segment of the marine transportation industry. Its operational framework is built around continuous adherence to international safety and environmental protocols, ensuring that each voyage in offshore and deep-water environments is executed with precision. The controlled exposure to market volatility is achieved through long-term charter commitments, which serve as a safeguard against short-term disruptions and economic swings.
The company also emphasizes rigorous maintenance, technical oversight, and industry-standard risk management practices, which collaboratively safeguard operational continuity and asset value. By integrating advanced monitoring systems and regular compliance audits, KNOP maintains high reliability and performance standards throughout its fleet operations.
Key Service Offerings
- Shuttle Tanker Operations: Specialized vessel management including crude oil loading, transportation, and storage services.
- Long-Term Charter Agreements: Contracts that assure operational and revenue stability over extended periods.
- Asset Acquisition: Strategic acquisition initiatives to expand and modernize the fleet, optimizing operational benchmarks.
- Integrated Operational Support: Leveraging the extensive network and expertise from its sponsor to streamline administrative and operational functions.
Industry Insights and Operational Milieu
The offshore oil transportation market is inherently complex, with shuttle tanker operations being a critical yet specialized component. KNOP's operations reflect a focus on safety, efficiency, and meticulous planning, which are essential given the dynamic and unpredictable nature of the industry. The company's ability to meet stringent international maritime regulations and environmental standards underlines its commitment to operational excellence. Furthermore, its geographic focus on the North Sea and Brazil anchors it in regions with historically significant oil production but also areas that demand adherence to robust operational protocols and deep sector expertise.
Conclusion
KNOT Offshore Partners LP (KNOP) is a well-defined entity within the offshore oil logistics sector, characterized by its dedicated fleet of shuttle tankers and a business model deeply rooted in long-term charter operations. Its strategic partnership with Knutsen NYK Offshore Tankers enhances both its operational efficiency and competitive positioning, making it a significant participant in the niche market of offshore crude oil transportation. Through rigorous risk management, adherence to high safety standards, and a focus on operational excellence, KNOP continues to maintain a stable footing in a challenging industry environment, offering insights into a specialized segment that remains crucial to global energy logistics.
KNOT Offshore Partners LP (NYSE:KNOP) has announced an exchange agreement with its sponsor, Knutsen NYK Offshore Tankers AS, to eliminate incentive distribution rights (IDRs). In return, Knutsen NYK will receive 673,080 common units and Class B Units, which introduces a new class of limited partner interests with specific distribution conditions. The IDR Exchange, set to close on September 10, 2021, will enhance the alignment of interests between the sponsor and common unitholders, potentially increasing the attractiveness of KNOP as an investment.
KNOT Offshore Partners LP reported total revenues of $70.9 million for the three months ended June 30, 2021, slightly down from $71.5 million in the previous quarter. The Partnership experienced an operating loss of $1.2 million and a net loss of $10.9 million, influenced by a $29.4 million non-cash write-down on the Windsor Knutsen. Adjusted operating income was $28.2 million, with an Adjusted EBITDA of $52.1 million. The Partnership paid a cash distribution of $0.52 per common unit on August 12, 2021, maintaining a distribution coverage ratio of 1.32. Liquidity stood at $101.6 million.
Knot Offshore Partners LP (NYSE:KNOP) will hold its 2021 Annual Meeting on September 16, 2021, at 12:30 pm UK time at One Elmfield Park, Bromley, UK. The record date for voting is August 12, 2021. Associated materials will be provided prior to the meeting. Depending on health regulations, the meeting’s location may change, or it may be conducted via remote communication. Any updates will be communicated through a press release ahead of the meeting.
KNOT Offshore Partners LP (NYSE:KNOP) will release its Second Quarter 2021 financial results on August 26, 2021, before the market opens. A conference call to discuss the results is scheduled for the same day at 11:00 AM Eastern Time, with options for participants to join via phone or webcast. Additionally, an earnings presentation will be available on their website prior to the call. The conference call will be recorded and accessible until September 2, 2021. KNOT Offshore Partners operates shuttle tankers under long-term charters in the North Sea and Brazil.
KNOT Offshore Partners LP (NYSE:KNOP) announced a quarterly cash distribution of $0.52 per unit for the quarter ending June 30, 2021, amounting to $2.08 on an annualized basis. This cash distribution will be disbursed on August 12, 2021, to unitholders of record as of July 29, 2021. KNOT Offshore Partners operates shuttle tankers under long-term charters in the offshore oil sectors of the North Sea and Brazil, and is structured as a publicly traded master limited partnership.
KNOT Offshore Partners LP (NYSE:KNOP) announced that CEO Gary Chapman will present at the 2021 Energy Infrastructure Council (EIC) Investor Conference on May 19 at 11:45 AM Eastern Time. The presentation will be available via webcast on the Partnership’s website, allowing attendees to access the event remotely. A replay will be accessible for 30 days following the live presentation. KNOT Offshore Partners LP is a publicly traded master limited partnership focused on owning, operating, and acquiring shuttle tankers in offshore oil production regions, particularly in the North Sea and Brazil.
KNOT Offshore Partners reported strong financial performance for Q1 2021, with total revenues of $71.5 million, an increase from the $69.9 million in Q4 2020. The Partnership generated operating income of $27.6 million and net income of $28.1 million. Adjusted EBITDA reached $51.3 million, with a distribution coverage ratio of 1.20. Notably, the Partnership maintained robust liquidity, ending with $115 million available. CEO Gary Chapman highlighted strong cash flow and effective vessel utilization despite challenges posed by COVID-19.
KNOT Offshore Partners LP (NYSE:KNOP) will release its First Quarter 2021 financial results before the market opens on May 13, 2021. A conference call is scheduled for the same day at 11:00 AM (ET) to discuss these results. Interested parties can access the call via phone or through a webcast available on the Partnership's website. The earnings presentation will also be available prior to the call. A recording of the conference call will be accessible until May 20, 2021.
KNOT Offshore Partners LP (NYSE:KNOP) has declared a quarterly cash distribution of $0.52 per unit for the quarter ending March 31, 2021, equating to $2.08 annually. This distribution will be paid on May 13, 2021, to unitholders of record as of the close of business on April 29, 2021. The partnership focuses on owning, operating, and acquiring shuttle tankers under long-term charters in offshore oil production areas, primarily in the North Sea and Brazil. KNOP units trade on the New York Stock Exchange.
KNOT Offshore Partners LP (NYSE:KNOP) has filed its Annual Report on Form 20-F for the year ending December 31, 2020, with the SEC. This report is available on the Partnership’s website under the “Investor Relations” section and the SEC's website. Unitholders can request a hard copy of the report, which includes complete audited financial statements, at no cost by contacting the Partnership via email or mailing address provided.
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