Safe Bulkers starts gradual fleet renewal focusing on green ships

Dry bulk shipping company Safe Bulkers wants to gradually renew its fleet with modern designs compliant with the new environmental regulations.

In line with those efforts, in October 2020, the company signed a deal to buy a Japanese-built, Kamsarmax class, 82,000 dwt, newbuild bulker with a scheduled delivery within the first half of 2022.

Safe Bulkers said the vessel is designed to meet the latest requirements of Energy Efficiency Design Index to Green House Gas, GHG emissions, and ‘EEDI Phase 3’. It will also comply with the latest NOx emissions regulation, NOx-Tier III.

The bulker owner has also entered into a sale and leaseback through a bareboat charter agreement with a third party for 90% financing of this acquisition.

As informed, the bareboat charter to be consummated upon delivery will have a duration of ten years with a purchase obligation.

The bulker owner has been strong supporter of scrubber technology as a pathway for becoming compliant with the IMO 2020 Sulphur cap.

As of September 30, 2020, it has completed the installation of 20 scrubbers and continues the project of retrofitting BWTS in all vessels of the company’s fleet, having installed 30 systems to date.

The aggregate cost of the company’s environmental investments as of quarter end was $66.7 million.

For the third quarter of 2020, Safe Bulkers reported a net income of $3.3. million against a $13.9 million loss in the previous quarter and a $5.9 million income in Q3 2019. For the first nine months of 2020, the net loss stood at $20.5 million, against a net income of $12.5 million a year earlier.

The company’s performance was significantly impacted by the negative effect from the COVID-19 pandemic as demand dropped resulting in lower charter rates and higher crew and related costs.

“Our financial performance gradually improved in parallel with the chartering market during the 3rd quarter. At the same time, we focused on developing a plan for renewing our fleet with modern designs that adhere to the new environmental regulations,” Dr. Loukas Barmparis, President of the Company, said.

“Due to market uncertainties, we remain cautious and we believe that our liquidity position which exceeds $130 million provides us with the required flexibility.”