Days after resolving a deadlock conflict between its two significant shareholders, global tanker giant Euronav embarks on a mission to uphold its long-standing business routine, reassuring the market with its consistent focus on long-term objectives. Today, the company announced a move indicating its steadfast shift toward expansion, taking up the construction clause for an additional VLCC, set for a 2026 delivery.
The New Order: Strengthening Euro nav’s Fleet Amid Market Demand
In a bid to bolster its fleet, Euronav capitalized on the option for the construction of a second 319,000-ton VLCC. The ship is to be built by Qingdao Beihai Shipbuilding Co., a branch of China National Shipbuilding Corporation. Priced at $112.2 million per vessel, Euronav underscores it secured “extremely advantageous payment terms.” Plus, there’s a swift schedule that dictates both ships’ delivery in the 2026 third quarter.
In an era where orders for VLCCs are dwindling and an ever-increasing market demand for new capacity, the VLCC order book has been witnessing its lowest since the 1980s. Likewise, Beihai regards the order it received in August as its triumphant foray into the large tanker market, and it’s also Euronav’s maiden VLCC order for a ship on Chinese soil.
Shareholders’ Deadlock: A Settled Dispute
This new order comes hard on the heels of the company shake-up wherein Frontline and CMB ironed out their differences and split Euronav, with 24 of the latter’s contemporary VLCCs sold to Frontline. The two major shareholders had been at loggerheads regarding Euronav’s strategic path and management, a dispute that ended with CMB buying out Frontline’s Euronav shares.
Maintaining Sustainability: Transition to Alternative Fuels
This move seamlessly ties in with the revised strategic direction assented upon by CMB for Euronav. Controlled by the Saverys family, CMB emphasizes the urgency to hasten decarbonization endeavors – a shift to cleaner fuels is high on the family’s agenda. They also plan on diversifying Euronav beyond just being a tanker operator.
Each new vessel will be ready for ammonia with two 6,000 cubic meter reservoirs for the future green energy source. The blueprint anticipates a zero-carbon operation, with the VLCCs being a staggering 1,113 feet long and nearly 196 feet wide, boasting an operating speed of 14.5 knots.
The Roadmap Ahead: Diversifying the Fleet
With the pending sale to Frontline set to close soon, Euronav will retain around 17 VLCCs in its roster, in addition to the duo on order, as well as 22 Suezmax tankers, with four more in the pipeline. CMB intends to expedite the diversification of Euronav’s fleet, even if it means incorporating some of CMB’s fleet. Amidst the whirlwind of changes, the case of Euronav signals an inspiring story of resilience and perseverance with an unfaltering approach to its core mission.
