International Seaways’ Order for Two LR1 Product Tankers from K Shipbuilding Becomes Effective

New York-based tanker company International Seaways has exercised options for two scrubber-fitted, LNG dual-fuel ready LR1 vessels at Korean shipbuilder K Shipbuilding Co.

The options were lifted in October bringing the ordering tally to four LR1 newbuilds at the yard worth approximately $231 million, the tanker owner said.

The newbuilds are expected to be delivered beginning in the second half of 2025 through the first quarter of 2026. The first two orders were announced in August of this year, two years after International Seaways ordered three LNG dual-fuel Very Large Crude Carriers (VLCCs) from K Shipbuilding in March 2021.

Upon delivery, they will be employed in Panamax International Pool, which, according to International Seaways, has consistently outperformed the market.

International Seaways reported a net income for the third quarter of $98 million, compared to net income of $113 million in the third quarter of 2022. Cumulative net income over the last twelve months was $643 million.

The drop in net income was ascribed to an increase in charter hire expenses, and an increase in vessel expenses, primarily due to the impact of VLCC newbuilding deliveries combined with inflationary increases in lubes, stores, and spares.

The latest order is part of the company’s fleet optimization program, which has also seen the tanker owner and operator’s activity in the charter market.

Namely, during 2023, the company has entered into six, time charter agreements: one 2017-built Aframax, three 2008-built MRs, one 2011-built MR, and one 2012-built Suezmax. The charters have durations of two to three years and have increased contracted future revenues to approximately $344 million, the company said.

As part of its fleet renewal, the shipowner also sold two 2008-built MRs, which generated approximately $24 million in net proceeds after debt repayment.

Moreover, since the beginning of the year, the company has taken delivery of three dual-fuel VLCC newbuildings.

Yangzijiang Shipbuilding

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