Iran Plans Listing NITC to Fund Fleet Modernization

Posted by Eric Haun
Friday, January 22, 2016
Photo: NIOC

Iran plans to list its national tanker company to raise badly needed cash to upgrade its massive fleet and replace older vessels, as the middle east country prepares for an aggressive return to the global oil market.

 
The country emerged from years of economic isolation last weekend after crippling sanctions were lifted in return for Tehran complying with steps to curb its nuclear ambitions.
 
Iran has one of the world's biggest tanker fleets, but many of the ships are ageing and require valid insurance, testing, inspection and certification, known as ship classification, to be able to ply international waters again.
 
Nasrollah Sardashti, the commercial director of the National Iranian Tanker Company (NITC), said his company was in talks with all leading insurance and classification firms, including Lloyds, DNV GL and Bureau Veritas.
 
"We are in talks with insurance and with classification societies (and) ready to class our ships," he said by telephone from Tehran.
 
Shipping sources say NITC has more than 40 tankers out of a fleet of around 70, that are new and modern enough to export oil once they receive classification, which could be achieved within weeks.
 
But the years of sanctions mean that Iran needs cash to modernize 20 large tankers within the next 2-3 years in what would be one of the biggest shipping orders of the past years, worth up to $1.5 billion based on average prices for new tankers.
 
To raise money, Tehran is planning a public listing of NITC.
 
"We are planning to list NITC first on local exchanges and then we will go for overseas listing to raise funds," said Sardashti, adding that it still needed to obtain board approval.
 
Iran has the world's fourth-biggest proven oil reserves but its exports have slumped from a pre-sanctions peak of over 3 million barrels per day (bpd) to little over 1 million bpd as the restrictions left it with only a few customers, largely in Asia.
 
Big Party
In a depressed global shipping sector, Iran offers a rare business opportunity.
 
And in a sign of this appetite, foreign shippers and brokers flocked to Tehran last week to attend NITC's 60th birthday party on January 17.
 
"650 people attended the anniversary, 350 from Iran and 300 from overseas. Almost all international shipping companies and brokerage firms were there," said Sardashti.
 
NITC says it has a fleet of 69 tankers, 66 of which are crude carriers, with a total of 15.5 million deadweight tonnage (DWT).
 
"We don't have any plan to expand the size but we do have the plan for fleet renewal to replace some of the older ships," Sardashti said.
 
Shipping sources estimate NITC's needs to replace over 20 tankers, including Very Large Crude Carriers (VLCC) capable of carrying 2 million barrels of oil, and Suezmax tankers capable of carrying 1 million barrels.
 
"We need approvals and then we start placing orders in 2016... it takes 2-3 years to take delivery of ships," Sardashti said.
 
Delivery of relatively new second-hand vessels would be much faster, possible within two months.
 
In Iran's tanker fleet, 11 VLCCs and Suexmaxes were built in 1999 or earlier, according to the Equasis shipping database. A further 10 were built in 2000.
 
Although all the tankers are double hull and comply with international regulations, they are getting old as the life of a trading VLCC is 15-17 years.
 
Shipping sources said most South Korean ship builders, including Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries, would likely bid for new contracts.
 
Yards in China that could participate include Dalian Shipbuilding and Shanghai Waigaoqiao Shipbuilding.
 
Current prices for a new VLCC is $93-$94 million, according to shipping broker Clarkson.
 
Beyond a potential listing, Sardashti said that he hoped NITC would receive 70-80 percent international financing for fleet modernization either from European or Asian lenders.
 
But Iran could still face legal uncertainties. These include a lack of a dollar clearing, the absence of an established mechanism for non-dollar sales, insufficient clarity on ship insurance and a reluctance of banks to provide letters of credit to facilitate trade with Iran.


(By Nidhi Verma and Keith Wallis; Writing by Henning Gloystein; Editing by Ed Davies)

People & Company News

Abu Dhabi Ship Building Commissions First Floating Dock

Abu Dhabi Ship Building PJSC (ADSB) has commissioned its first floating drydock located in Mina Zayed as the company looks to expand its commercial service offering.

MN100: Glosten

The Company: Glosten is an employee-owned full-service consulting firm of naval architects, marine engineers, electrical engineers, and ocean engineers. Founded in 1958,

MN100: MAN Engines & Components

The Company: MAN Engines and Components develops, produces and sells a wide range of efficient diesel and gas engines for extremely varied applications in many industries.

Shipbuilding

Abu Dhabi Ship Building Commissions First Floating Dock

Abu Dhabi Ship Building PJSC (ADSB) has commissioned its first floating drydock located in Mina Zayed as the company looks to expand its commercial service offering.

NAT Names 2 New Tankers in South Korea

wo new tankers, Nordic Star and Nordic Space, were named August 24 for owner Nordic American Tankers Limited (NAT).   NAT founder and chairman Herbjørn Hansson was present at the naming ceremony,

Japanese Yards Mull Shipbuilding Alliance

Four major Japanese shipbuilders are in discussions to form an alliance in hopes of riding out the industry slump.   Mitsubishi Heavy Industries, Ltd. (MHI) announced

Ship Repair & Conversion

Abu Dhabi Ship Building Commissions First Floating Dock

Abu Dhabi Ship Building PJSC (ADSB) has commissioned its first floating drydock located in Mina Zayed as the company looks to expand its commercial service offering.

Wärtsilä to Launch Sea-Master at SMM

Set to launch at SMM 2016 in Hamburg September 6-9, 2016, the new Wärtsilä Sea-Master system uses digital technology to monitor shaft bearings and seals to help

First Multi-stream DuPont Scrubbers Installed

DuPont, through its subsidiary Belco Technologies Corporation (BELCO), is installing the first of its proprietary in-line, multi-engine marine scrubbers serving

Finance

OSV firm Farstad Continues Restructuring Talks

Supply firm Farstad Shipping's CEO Karl Johan Bakken repeats is in stand-still agreement with lenders until Oct. 1   Notable disclosures: * CEO says is talking

Banks Halt Support for Hanjin

A bankruptcy would be biggest ever for a container shipper. Hanjin Shipping Co's banks are halting support for the South Korean company, its lead creditor said,

China Cosco Sinks into Red

Dragged by lackluster freight rates in the maritime transport market during the first half of 2016, China Cosco Holdings logged a 7.2 billion yuan ($1.07 billion) net loss for the January-June half,

Energy

Jt Study by MOL, Yokohama University for Improving Ocean Shipping Market Forecast

Mitsui O.S.K. Lines, Ltd. today announced that the company and its subsidiary MOL Information Systems, Ltd. have signed a contract with Yokohama National University

DNV GL Launches New Approach to Manage Uncertainty in Risk Assessment

There is increasing emphasis from regulators on addressing uncertainty in risk assessments to improve safety. DNV GL’s new paper, ‘Enabling confidence – addressing uncertainty in risk assessments’,

Gasum, Wärtsilä Join Forces to develop Gas Value Chain

New joint co-operation between Gasum and Wärtsilä aims to develop the utilization and distribution of natural energy gases in marine and land markets. Gasum,

News

Abu Dhabi Ship Building Commissions First Floating Dock

Abu Dhabi Ship Building PJSC (ADSB) has commissioned its first floating drydock located in Mina Zayed as the company looks to expand its commercial service offering.

NAT Names 2 New Tankers in South Korea

wo new tankers, Nordic Star and Nordic Space, were named August 24 for owner Nordic American Tankers Limited (NAT).   NAT founder and chairman Herbjørn Hansson was present at the naming ceremony,

Wounded Lobsterman Medevaced near Cape Cope

An injured lobsterman was medically evacuated by U.S. Coast Guard helicopter crew Tuesday roughly 130 nautical miles east of Cape Cod.   At about 10:15 a.m.,

Vessels

NAT Names 2 New Tankers in South Korea

wo new tankers, Nordic Star and Nordic Space, were named August 24 for owner Nordic American Tankers Limited (NAT).   NAT founder and chairman Herbjørn Hansson was present at the naming ceremony,

Refit River Cruiser Sets Sail for Crystal

The newly renovated vessel Mozart, which began passenger service in July 2016, marks Crystal Cruises’ first venture into European river cruising.   Before for

Another Tug Launched for Suderman & Young

Eastern Shipbuilding Group, Inc. said it launched on August 15, 2016 the final vessel in a series of four Z-Tech Class Terminal & Escort Tugs being constructed for Suderman & Young Towing Company.

 
 
Maritime Contracts Naval Architecture Offshore Oil Pipelines Port Authority Ship Electronics Ship Repair Ship Simulators Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1507 sec (7 req/sec)