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Overseas Shipholding Group,Inc (NYSE: OSG) and also American Shipping Company ASA (Oslo Stock Exchange: AMSC) (OTCQX: ASCJF) today collectively revealed that OSG has actually worked out choices to expand its bareboat charter contracts with AMSC for 4 vessels presently under charter from AMSC.
Each bareboat charter contract was prolonged for extra three-year terms, starting from December 2020 and also finishing in December 2023. OSG formerly exercised its choices to expand charter contracts for every one of the 6 various other vessels that it rents from AMSC. As an outcome, all 10 bareboat charter contracts with AMSC have actually currently been prolonged for extra durations.
AMSC, in which Aker ASA is the biggest investor with a 19% risk, was established in 2005 in parallel with what was after that Aker Philadelphia Shipyard (currently Philly Shipyard). It has a fleet of 9 modern-day MR item vessels and also one modern-day shuttle bus vessel, constructed at the Philadelphia shipyard and also all running in the united state Jones Act market and also on long-term bareboat charters with evergreen expansion choices with OSG.
OSG is a significant driver of vessels and also ATBs in the Jones Act sector. OSG’s 21 vessel fleet contains 2 traditional ATBs, 2 lightering ATBs, 3 shuttle bus vessels, 10 traditional MR vessels, and also 2 non-Jones Act MR vessels that join the united state Maritime Security Program, every one of which are united state flagged, in addition to 2 Marshall Island flagged non-Jones Act MR vessels selling worldwide markets. In enhancement, OSG has 2 barges incomplete in the united state that will certainly be Jones Act certified vessels, with distribution in 2020. These vessels are expected to be coupled with the Company’s existing pulls running in the Jones Act profession.
OSG’s chief executive officer Sam Norton stated, “The contract extensions for the four vessels involved will allow us to continue our close working relationship with AMSC for many more years. The decision to further extend the maturities of each of the four vessels underscores our confidence that the continuing move towards balance in the Jones Act tanker market is an opportunity to serve our core customers in a rate environment that will provide attractive returns over time.”
The bareboat charter contracts offer that the 3- and also five-year choices for these vessels are readily available forever. The lease settlements for the bareboat charters are taken care of throughout the choice durations, and also the choices get on a vessel-by-vessel basis and also can be worked out independently.
AMSC’s chief executive officer Pål Lothe Magnussen commented, “We are pleased to see OSG continuing to extend the bareboat charters for our vessels. AMSC benefits from the cash flow stability provided by these contracts and exposure to increasing profits in the future. We look forward to maintaining our cooperation with OSG.”
