TEN Ltd. Announces the Sale of a 2005-Built Suezmax Tanker and Completion of the First Phase of Its Dual-Fuel Renewal Program
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Insights
The divestment of the 2005-built suezmax tanker Eurochampion 2004 and the acquisition of two LNG-powered aframax tankers represent a strategic move for TEN, Ltd. The sale of the Eurochampion 2004, which was debt-free, will inject approximately $40 million into the company's cash reserves. This is a significant liquidity event that could bolster the company's financial flexibility. The concurrent delivery of the Chios DF and the Ithaki DF, both featuring eco-friendly designs and secured long-term contracts, aligns with the growing demand for environmentally sustainable shipping solutions.
From a financial perspective, the move towards a 'greener' fleet could potentially offer a competitive advantage in terms of operational cost savings and compliance with future regulations. This transition may also appeal to environmentally conscious investors and clients, possibly opening up new market opportunities. However, it is essential to monitor the capital expenditure associated with the fleet renewal program and the impact on the company's debt profile over time.
The maritime industry is increasingly moving towards sustainability with a focus on reducing carbon emissions. TEN's shift to LNG-powered vessels is indicative of this trend and is likely to have a positive reception in the market. The long-term employment contracts for these vessels suggest a stable revenue stream and a vote of confidence from a major oil concern in TEN's operational capabilities and strategic direction.
Furthermore, the geopolitical context, such as tensions in the Red Sea, can affect tanker rates and trade routes. TEN's proactive fleet renewal strategy could position the company to capitalize on such fluctuations. The company's ongoing discussions for further sales and the potential growth through newbuilding and secondhand acquisitions show a commitment to maintaining a modern and versatile fleet, which is critical in a sector where charter rates and vessel demand can shift rapidly.
LNG as a marine fuel has emerged as a transitional solution to meet the International Maritime Organization's (IMO) goals for reducing greenhouse gas emissions from ships. The delivery of LNG-powered aframax tankers aligns with global environmental policies and can improve TEN's regulatory standing ahead of more stringent emission standards. The environmental benefits of such vessels, including lower sulfur oxide and nitrogen oxide emissions compared to traditional heavy fuel oil-powered ships, could provide TEN with potential market advantages, including access to emission control areas (ECAs) and possibly reduced port fees in certain jurisdictions that incentivize green shipping.
However, the long-term sustainability of LNG as a fuel is debated, as it is still a fossil fuel and does not fully eliminate carbon emissions. The maritime industry's transition to zero-emission vessels is on the horizon, with technologies like hydrogen and ammonia-fueled ships being developed. TEN's investment in LNG-powered vessels may need to be reviewed in the context of such emerging technologies and the possibility of future regulatory shifts that favor carbon-neutral alternatives.
Green initiative newbuilding program on track
Red Sea tensions further boosts tanker rates
ATHENS, Greece, Jan. 22, 2024 (GLOBE NEWSWIRE) -- TEN, Ltd (TEN) (NYSE: TNP) (the “Company”) announces the sale of the 2005-built suezmax tanker Eurochampion 2004 and the concurrent delivery of two LNG powered aframax tankers, the Chios DF and the Ithaki DF, the last remaining vessels in a series of four high-spec eco-designed tankers built against long-term employment to a major oil concern.
The Eurochampion 2004 which was debt free, will contribute approximately
“The sale and delivery of these three vessels constitute another milestone for TEN as it highlights the Company’s commitment to fleet renewal by combining profitable vessel divestments with deliveries of high-end “green” vessels on long-term contracts,” Mr. George Saroglou, President & COO of TEN commented. “The Eurochampion 2004 has served the Company well over the years and we wish her new owners “calm seas” in her journeys. With the all LNG-powered vessels now delivered, management will continue to explore growth opportunities on both the newbuilding and secondhand front while maintaining its interest in strategic sales to ensure a seamless fleet transition going forward,” Mr. Saroglou concluded.
TEN’s CURRENT GROWTH PROGRAM
| # | Name | Type | Delivery | Status | Employment |
| 1 | Njord DF | Aframax Dual Fuel | Sep. 2023 | Delivered | Yes |
| 2 | Ran DF | Aframax Dual Fuel | Oct. 2023 | Delivered | Yes |
| 3 | Chios DF | Aframax Dual Fuel | Jan. 2024 | Delivered | Yes |
| 4 | Ithaki DF | Aframax Dual Fuel | Jan. 2024 | Delivered | Yes |
| 5 | TBN | DP2 Shuttle Tanker | Q2 2025* | Under Construction | Yes |
| 6 | TBN | DP2 Shuttle Tanker | Q2 2025* | Under Construction | Yes |
| 7 | TBN | Suezmax – Scrubber Fitted | Q2 2025* | Under Construction | Under Discussion |
| 8 | TBN | Suezmax – Scrubber Fitted | Q4 2025* | Under Construction | Under Discussion |
| 9 | TBN | MR – Scrubber Fitted | Q1 2026* | Under Construction | Under Discussion |
| 10 | TBN | MR – Scrubber Fitted | Q1 2026* | Under Construction | Under Discussion |
*Expected delivery as per shipbuilding contracts
ABOUT TEN
TEN, founded in 1993 and celebrating this year 30-years as a public company, is one of the first and most established public shipping companies in the world. TEN’s diversified energy fleet currently consists of 67 double-hull vessels, including two DP2 shuttle tankers, two scrubber-fitted suezmax vessels and two scrubber-fitted MR product tankers under construction, constituting a mix of crude tankers, product tankers and LNG carriers, totaling 8.2 million dwt.
ABOUT FORWARD-LOOKING STATEMENTS
Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements. TEN undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise.
For further information, please contact:
Company
Tsakos Energy Navigation Ltd.
George Saroglou
President & COO
+30210 94 07 710
gsaroglou@tenn.gr
Investor Relations / Media
Capital Link, Inc.
Nicolas Bornozis
Markella Kara
+212 661 7566
ten@capitallink.com
Visit our company website at: http://www.tenn.gr
FAQ
What vessels did TEN announce the sale of?
What type of tankers were delivered concurrently with the sale?
How much will the sale of Eurochampion 2004 contribute to the Company’s cash balances?
What does the sale and delivery of the three vessels highlight?
