Today it entered into an agreement to purchase four fuel-efficient LR2 newbuildings from Chinese shipbuilder 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 expects to have a total CAPEX relating to the four firm vessels of approximately $200 million, including extra costs related to Torm's design requirements and supervision. It says it is in advanced dialogue with potential lenders obtain financing for the newbuildings.
With today's agreement, Torm has CAPEX commitments of $273 million, covering the remaining CAPEX on its remaining three MR newbuildings, one second-hand MR vessel and the four new LR2 vessels. Torm has a liquidity position of approximately $280 million including available debt facilities of $97 million.
Torm says it has utilized its long-term relationship with GSI and China State Shipbuilding Corporation to source today's contract. Torm already has 16 GSI vessels in the current fleet and has good technical and commercial experience with them. The new vessels will be constructed according to Torm's specifications in order to optimize trading.