TORM has entered into an agreement to purchase four fuel-efficient LR2 newbuildings from Guangzhou Shipyard International (“GSI”) with expected delivery in the period between the fourth quarter of 2017 and the second quarter of 2018. The agreement includes the option to purchase up to six additional vessels within the LR2, LR1 or MR segment with expected delivery in 2018 and 2019.
TORM has utilized its long-term relationship with GSI and China State Shipbuilding Corporation to source the contract. TORM already has 16 GSI vessels in the current fleet and has good technical and commercial experience with these vessels. The vessels will be constructed according to TORM’s specifications in order to optimize trading. This is TORM’s first ordering of newbuildings since 2008.
TORM expects to have a total CAPEX relating to the four firm vessels of approximately USD 200m including extra costs related to TORM’s design requirements and supervision. TORM is in advanced dialogue with potential lenders in order to obtain financing for the newbuildings.
With this agreement, TORM has CAPEX commitments of USD 273m covering the remaining CAPEX on TORM’s remaining three MR newbuildings, one second-hand MR vessel and the four new LR2 vessels. TORM has a liquidity position of approximately USD 280m including available debt facilities of USD 97m.