New York-listed Scorpio is scouting out shipmanagers to take over the technical management of its tankers.
The company is on the hunt to appoint at least two third-party managers to take on part of its fleet under contracts with the current manager, Monaco-based affiliate Scorpio Ship Management.
Well placed sources within shipmanagement circles say that teams from Scorpio have been travelling through Asia to sound out several of the larger shipmanagers operating in the region.
A source close to Scorpio management says the process has been ongoing since May and is not confined to Asia.
It reflects Scorpio’s recognition that it needs “safety valves or alternatives” in keeping pace with a rapidly escalating newbuilding programme in both products tankers and liquified petroleum gas (LPG) vessels.
“It reflects an understanding that if your capacity to take deliveries gets ahead of your ability to maintain safety, integrity and quality of operations, you can move into third-party shipmanagers,” said the source.
“You’re simply trying to create safety valves or alternatives.”
It is not clear yet just how many of Scorpio’s tankers will be farmed out to third-party managers.
Market suggestions indicate that it will be the overwhelming majority of the company’s tanker fleet.
The hunt for managers is not directed at the Scorpio group’s other major market move into dry bulk, the source indicates.
But LPG is a priority as Scorpio has no prior experience in a sector where it has 11 very large gas carriers (VLGCs) on order.
TradeWinds understands that Scorpio has approached most major tanker managers, including Singapore-based Thome and Hong Kong-based Anglo-Eastern.
Thome chairman Olav Eek Thorstensen declined to comment on his company’s potential involvement with Scorpio.
“We are always in discussions with various shipowners and it would not be appropriate to comment on any such talks,” he said.
In its short existence, Scorpio Tankers has amassed what is arguably the world’s largest single fleet of owned products tankers. According to the company’s website, it has 18 such vessels in the water.
A further 55 products tanker newbuildings are set to join the fleet in 2014 and 2015, together with the 11 VLGCs in 2015 and 2016.
This meteoric rise in the number of vessels in the company’s fleet is said to be the primary reason why it is looking at third-party shipmanagers.
Industry observers believe that it is just not possible for Scorpio Ship Management to take on such a large number of ships in such a short period of time, especially when taking into account the company experience required for ship officers under the Oil Companies International Marine Forum’s (OCIMF) Tanker Management and Self Assessment (TMSA) guidelines.
It is also believed that taking on so much newbuilding supervision work would stretch Scorpio Ship Management’s resources severely.
Scorpio has been talking about the situation for months now with its banks and investors, who will not be surprised by the third-party initiative, according to the source close to management.
“We will have a plan to take delivery of the vessels,” he said. “It’s such a large group of deliveries — sometimes four or five in a month. Crewing is a big part of it — in fact, it’s the main part of it.”
The source would not estimate when Scorpio Services will have contracts in place, but noted that the escalation in products deliveries begins next April.
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