Scorpio Tankers Orders More Vessels

Emanuele Lauro says the company is confident in its newbuilding program

Scorpio Tankers Inc. [NYSE:STNG] (Scorpio Tankers) says it has reached agreement with South Korea's Hyundai Mipo Dockyard Ltd (HMD) for the construction of two 50,000 deadweight product tankers to be delivered in May and June 2014.

The orders by the New York listed tanker operator, which is said were a continuation of the company's existing newbuilding program for fuel-efficient vessels, follow its announcement last month for six new 'eco' tanker newbuildings.

In conjunction with the contracts, the tanker operator said it received fixed price options with HMD to construct up to four 37,000 dwt 'Handysize' fuel-efficient product tankers to be delivered within 2014.

It now has a total of 13 Medium Range (MR) product tanker newbuilding orders with HMD and SPP Shipbuilding Co., Ltd, also of South Korea.

Three of the vessels are expected to be delivered by April 2013, with the remaining 10 due by September 2014.

The company says it also has fixed-price options to construct a total of 12 additional newbuilding product tankers at the South Korean yards.

Scorpio Tankers said it has also taken delivery of four previously announced time chartered-in vessels.

"Our markets have witnessed significant tightening since the middle of November, beyond what seasonal expectations alone would typically augur," commented Scorpio Tankers chief executive officer and chairman of the board, Emanuele Lauro.

"As we look back at 2012, the fundamental changes in trade volumes and flows that we predicted were slow to materialize, but the manifestation of these fourth quarter improvements are becoming evident so far in the current quarter.

"Between the increases in exports of refined products from the United States, demand from developing markets, and trading activity across volatile commodity markets, we are confident in our newbuilding program and our charter-in strategy," he concluded.