OSG orders two U.S. flag tankers at Korean shipyard

JULY 17, 2018 — U.S.-flag tanker operator Overseas Shipholding Group, Inc. (NYSE: OSG) says it has signed binding contracts with South Korea's Hyundai Mipo Dockyard Company Ltd.for the construction of two 50,000 dwt product chemical tankers for anticipated delivery during the second half of 2019.

OSG says that, following delivery, the vessels will participate as U.S. flagged vessels in trades served by existing company vessels. Not being built in the U.S., the two newbuilds can't be Jones Act compliant, however, OSG's existing fleet currently includes two non-Jones Act MR tankers that participate in the U.S. MSP (Maritime Security Program).

The two new tankers will be constructed at HMD's Ulsan, Korea, shipbuilding facilities and will be built to comply with MARPOL Annex VI Regulation 13 Tier III standards regarding nitrogen oxide emissions within Emission Control Areas. In addition, each vessel will have exhaust gas cleaning systems (scrubbers) installed to meet the MARPOL Annex VI Regulation 14 standards on sulfur oxide emissions.

"OSG is committed to maintaining a leading presence in the U.S. flag petroleum transportation sector," said Sam Norton, OSG's President and CEO. "Our initiative to pursue construction of modern, efficient and environmentally responsible vessels sends a strong signal to our customers, our stockholders and our employees that we are confident in achieving our commitment and that we have the resources and unique skill sets to enable us to do so. We look forward to the contribution that these vessels will make to our long-term success once delivered."

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