Scorpio Tankers Inc. Announces Agreements to Sell Five MR Product Tankers
Scorpio Tankers (NYSE:STNG) has announced agreements to sell five MR product tankers. These include four vessels built in 2012, STI Garnet, STI Onyx, STI Ruby, and STI Topaz, which will be sold for a total of $142.5 million to three separate buyers. Additionally, a 2013-built vessel, STI Beryl, will be sold for $36.6 million. The company will not make any debt repayments as these vessels are unencumbered. All sales are expected to close by Q3 2024. Following these transactions, Scorpio Tankers' fleet will exclusively consist of vessels built in 2014 or later.
- Sale of five MR product tankers generating $179.1 million in aggregate.
- No debt repayments are required due to vessels being unencumbered.
- Fleet will comprise newer vessels, potentially lowering maintenance costs and increasing operational efficiency.
- Reduction in fleet size may impact revenue-generating capacity until new vessels are acquired or chartered.
Insights
Scorpio Tankers Inc. has announced the sale of five MR product tankers for a total of
From a financial perspective, the sale of unencumbered vessels, which means these ships are free of debt or any other obligations, is a positive signal. The absence of debt repayments associated with these sales will allow the company to retain the full proceeds of
In the shipping industry, newer vessels tend to be more fuel-efficient and compliant with modern environmental regulations, which can result in lower operational costs and higher profitability. By focusing on vessels built in 2014 or later, Scorpio Tankers is likely aiming to enhance its competitive position in the market.
Rating: 1
The sale of older MR product tankers by Scorpio Tankers Inc. suggests a strategic move to optimize their fleet. Modern vessels, particularly those built after 2014, generally offer improved fuel efficiency and are more compliant with the latest environmental regulations. This transition can lead to lower operating costs and better alignment with regulatory frameworks like the International Maritime Organization’s (IMO) emissions standards.
The fact that three of the sold vessels are scrubber-fitted highlights the company's previous investment in emissions control technology. Scrubbers allow vessels to continue using high-sulfur fuel oil, which can be cheaper than low-sulfur alternatives, potentially offering cost advantages.
In terms of fleet management, focusing on newer vessels may also reduce maintenance expenses and improve reliability and operational uptime, critical aspects in a competitive and capital-intensive industry like shipping.
Rating: 1
MONACO, June 11, 2024 (GLOBE NEWSWIRE) -- Scorpio Tankers Inc. (NYSE:STNG) (“Scorpio Tankers,” or the “Company”) announced today that it has entered into agreements to sell five MR product tankers (four 2012 built and one 2013 built). The 2012 built vessels (three of which are scrubber fitted), STI Garnet, STI Onyx, STI Ruby, and STI Topaz, have been contracted to be sold for
Following the completion of the above sales, the Company’s entire fleet will comprise vessels built in 2014 or after.
About Scorpio Tankers Inc.
Scorpio Tankers Inc. is a provider of marine transportation of petroleum products worldwide. Scorpio Tankers Inc. currently owns or lease finances 108 product tankers (39 LR2 tankers, 55 MR tankers and 14 Handymax tankers) with an average age of 8.3 years. The Company has entered into agreements to sell six of its MR tankers, which are expected to close in the second or third quarter of 2024. Additional information about the Company is available at the Company’s website www.scorpiotankers.com, which is not a part of this press release.
Forward-Looking Statements
Matters discussed in this press release may constitute forward‐looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward‐looking statements in order to encourage companies to provide prospective information about their business. Forward‐looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “target,” “project,” “likely,” “may,” “will,” “would,” “could” and similar expressions identify forward‐looking statements.
The forward‐looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although management believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond the Company’s control, there can be no assurance that the Company will achieve or accomplish these expectations, beliefs or projections. The Company undertakes no obligation, and specifically declines any obligation, except as required by law, to publicly update or revise any forward‐looking statements, whether as a result of new information, future events or otherwise.
In addition to these important factors, other important factors that, in the Company’s view, could cause actual results to differ materially from those discussed in the forward‐looking statements include unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies in response to epidemic and other public health concerns including any effect on demand for petroleum products and the transportation thereof, expansion and growth of the Company’s operations, risks relating to the integration of assets or operations of entities that it has or may in the future acquire and the possibility that the anticipated synergies and other benefits of such acquisitions may not be realized within expected timeframes or at all, the failure of counterparties to fully perform their contracts with the Company, the strength of world economies and currencies, general market conditions, including fluctuations in charter rates and vessel values, changes in demand for tanker vessel capacity, changes in the Company’s operating expenses, including bunker prices, drydocking and insurance costs, the market for the Company’s vessels, availability of financing and refinancing, charter counterparty performance, ability to obtain financing and comply with covenants in such financing arrangements, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, including the impact of the conflict in Ukraine and the developments in the Middle East, including the armed conflict in Israel and Gaza, potential disruption of shipping routes due to accidents or political events, vessels breakdowns and instances of off‐hires, and other factors. Please see the Company’s filings with the SEC for a more complete discussion of certain of these and other risks and uncertainties.
Contact Information
Scorpio Tankers Inc.
James Doyle – Head of Corporate Development & Investor Relations
Tel: +1 646-432-1678
Email: investor.relations@scorpiotankers.com
FAQ
What recent sales agreements has Scorpio Tankers (STNG) announced?
How much will Scorpio Tankers earn from the sale of their tankers?
Will Scorpio Tankers repay any debt from the proceeds of these vessel sales?
When are the sales of the Scorpio Tankers' vessels expected to close?
What will be the composition of Scorpio Tankers' fleet after the sale?
