Scorpio Buying Six More Ships

For the third time this month, Scorpio Tankers (NYSE: STNG  ) announced plans to expand its oil tanker fleet Thursday, as the Monaco-based oil shipper continues to deploy cash raised from a recent sale of 30.7 million shares of common stock.

Prior to today, Scorpio had placed orders this month for a grand total of $250 million in new oil tankers to be built for it in Korea -- eight new ships in all. Today, that number increased by six, as Scorpio announced it has exercised options to have Hyundai Mipo Dockyard Co., Ltd., build it two "Handymax ice class-1A" tankers for approximately $31.25 million each, and a further four MR Product tankers for $33 million apiece. In each case, Scorpio is paying slightly more than in contracts placed earlier this month. Total orders placed this month now amount to $444.5 million in value -- far more than the company raised in its recent stock offering.

Timeline-wise, Scorpio will take delivery of two of the MR tankers in Q2 2014. Q3 2014 will see the arrival of a third MR, and also both Handymaxes; Q4, the final MR.

As of today, Scorpio says it has orders for 26 new tankers outstanding, with options on 12 more.


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9/19/2014 3:39 PM
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