Scorpio's Fleet Grows Again
Scorpio Tankers' hunger for new ships just cannot be assuaged.
Barely a week after placing an order for six new tankers late last month, the company's back in the market for more tankers -- again. On Thursday, the Monaco-based oil shipper announced it is taking over the contracts for construction of four MR-class tankers that are currently being built by Hyundai Mipo Dockyard Co. Ltd. (HMD) for a third party. Scorpio will sign novation contracts with said customer, essentially "stepping into its shoes," and becoming the contracting customer. Each of the STI Amber-class vessels will cost it $36.5 million when delivered -- sometime between June and September 2013.
Scorpio's also hiring two more shipbuilding contracts with HMD of its own, exercising options to buy two Handymax ice class-1A vessels. These will cost Scorpio $31.5 million apiece, inclusive of the cost of taking out fixed-price options on even more ships.
Finally, Scorpio has chartered-in three existing vessels for its fleet, a Handymax and two LR2 product tankers, for which it will pay day rates of between $12,600 and $16,250.
At present, Scorpio has a total of 39 tankers under contract to be built -- 23 MRs, eight LR2s, and eight Handymaxes. Scorpio expects to have five of these ships in hand by September 2013, with the rest arriving before the end of 2014. When all's said and done, the company expects to pay $1.3 billion for these ships now under contract.
The article Scorpio's Fleet Grows Again originally appeared on Fool.com.Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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