Teekay Tankers Sells Aframax Duo, Posts Net Loss in Q3
- Business & Finance
Teekay Tankers has disposed of two 1999-built Aframax tankers since August 2017 collecting aggregate proceeds of approximately USD 12.7 million.
One Aframax tanker was delivered in September 2017 and the other is scheduled to be delivered in the second half of November 2017 to an undisclosed owner, the company said announcing its results for the third quarter.
The tanker owner further said that it has secured a time charter-out contract on an Aframax tanker for a firm period of 12 months at a daily rate of USD 15,000, plus a 12-month extension option at a higher rate, which commenced in October 2017.
The company recorded GAAP net loss of USD 22.4 million and adjusted net loss for the third quarter of 2017 of USD 14 million amid lower average spot tanker rates and a decrease in the company’s fleet size. The loss is much wider when compared to last year’s equivalent of USD 5.2 million.
GAAP net loss was also impacted by higher losses on vessel sales.
“Seasonal weakness combined with global inventory drawdowns as crude oil pricing moved into backwardation contributed to weak spot tanker rates in the third quarter of 2017. Our fixed charter coverage and our growing lightering business helped to mitigate some of this tanker market weakness during the quarter,” Kevin Mackay, Teekay Tankers’ President and Chief Executive Officer, said.
“Since that time, we have seen a significant uptick in crude tanker rates into the fourth quarter, supported by refineries returning from seasonal maintenance and an increase in long-haul movements from the Atlantic to the Pacific, which is increasing tanker ton-mile demand. Looking ahead to 2018, we expect that a significant slowdown in tanker fleet growth coupled with better oil market fundamentals will lead to a recovery in tanker rates.”
Overall, the company expects tanker rates to recover during the fourth quarter of 2017, in line with seasonal norms.
Teekay Tankers currently owns a fleet of 35 double-hull tankers, including 16 Suezmax tankers, 12 Aframax tankers, and seven LR 2 product tankers, and has four capital leased Suezmax tankers and one contracted time charter-in vessel. The company also owns a VLCC through a 50 percent-owned joint venture.