Capital Agrees New Charters for Three Ships

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  •  As Eimskip Secures Loan for Construction of Boxship Duo

Greek shipping company Capital Product Partners L.P. has secured additional work for two of its 8,266 TEU ships, MV Archimidis and MV Agamemnon, as the company signed time charter extensions for the vessels with Singapore-based carrier Pacific International Lines (PIL).

Under the agreements, the 108,892 dwt containerships, which were built in 2006 and 2007, respectively, will for for PIL for an additional year at similar levels to their previous employment.

The new charters were agreed early in the first quarter of 2017 in direct continuation of the vessels’ present charters.

MV Archimidis commenced its new charter in April 2017 and the MV Agamemnon is expected to start the new charter in May 2017, according to Capital Product Partners.

Additionally, the company’s 149,993 dwt crude oil tanker Amoureux has secured one year employment with Capital Maritime at a gross daily rate of USD 22,000. The new charter commenced in April 2017. The vessel was previously earning USD 29,000 gross per day under a two-year charter with Stena Bulk AB.

Capital Product Partners said that, as a result of the new charters, the company’s charter coverage for 2017 and 2018 has increased to 85% and 50%, respectively.

The new contracts were unveiled as part of the company’s financial report for the first quarter ended March 31, 2017, in which Capital Product Partners informed that its net income for the quarter stood at USD 12.3 million compared with USD 12.1 million seen in the first quarter of 2016.

Total revenues for the first quarter of 2017 reached USD 60.3 million, representing an increase of 4% compared to USD 58 million reported in the same three-month period a year earlier. The increase in total revenues was primarily a result of the expansion of the company’s fleet and the lower number of off-hire days during the first quarter of 2017, partly offset by the lower charter rates earned by certain vessels compared to the first quarter of 2016.

“We are pleased to see another quarter with strong common unit distribution coverage after the quarterly allocation of USD 14.6 million to the capital reserve, which is intended to fully provide for the debt repayments coming due under our credit facilities (other than the 2015 credit facility) through the end of 2018,” Jerry Kalogiratos, Chief Executive and Chief Financial Officer of the Partnership’s General Partner, said.

“The Partnership’s objective remains to further increase the long term distributable cash flow of the Partnership by pursuing additional accretive transactions going forward and by refinancing our debt,” Kalogiratos said.

In the meantime, Reykjavik-based shipping company Eimskip has reached an agreement for the financing of the construction of two 2,150 TEU container vessels ordered in January 2017.

The loan, secured by China Export & Credit Insurance Corporation (Sinosure), is for an 80% financing of the contract price of the vessels with a 15 year tenor in Euros taken upon delivery.

Under the shipbuilding contract signed with China Shipbuilding Trading Company Limited and Guangzhou Wenchong Shipyard, the boxships are each priced at around USD 32 million. The order was subject to financing and that has now been lifted, Eimskip informed.

The payment profile of the vessels, which are expected to be delivered in 2019, is that 40% of the contract price is paid during the building period and 60% upon delivery.

“The financing has a long tenor and has very favorable terms. By securing this financing we are taking an important step towards the renewal of Eimskip’s vessel fleet,” Gylfi Sigfússon, President and CEO,said.

Eimskip earlier said that the new ships will be designed in accordance with the Polar Code. With an overall length of 180 meters and breadth of 31 meters, the ships will have a TIER III engine to lower Nitrogen Oxide (NOx) emission into the atmosphere.

“These new vessels are the largest container vessels that have served in the North Atlantic in scheduled liner services and the ongoing expansion of the ports in Nuuk in Greenland, Reykjavik and Thorshavn in the Faroe Islands will make it possible for these large vessels to serve this market,” Sigfússon added.

World Maritime News

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