This is good news
Thriving eastern VLCC demand makes up for quiet westbound routes 22-Sep-00
Spot rates for VLCCs continued to move ahead yesterday on the back of strong demand from Asia and the Far East. Westbound cargoes have reduced to a trickle, while West African/North Sea loadings have picked up.
With the bulk of ships fixing Gulf-East, rates in that direction have risen nearly 17.5 points this week. On Friday, Navion was reported fixed with the 1990-built Taos, 275,993 dwt, MEG-Malacca 260 x WS 157.5 loading October 27.
Westbound destinations have accounted for a miniscule amount of cargoes from the Gulf. However, VLs have found increased activity in the Western Hemisphere in Africa, the North Sea and the Med. Shell was reported fixed with the 1993-built Front Duchess, 284,480 dwt, Sidi Kerir-Rotterdam-UKC 260 x WS 165 loading October 10.
Because NAT's BP charter party states:
"The charter party with BP is valid until September 2004 with a further seven one-year options in BP's favour. The contract ensures that the ships receive a minimum rate of USD 22,000 per day per ship on a time charter basis, but in periods when the tanker market is stronger the company will receive the market rate. The market rate is calculated quarterly in arrears on the basis of a formula set out in the contract. If the market is below USD 22,000 per day, NAT will still receive the minimum rate of USD 22,000.
Based on this rate structure, NAT is paying dividend to its shareholders every quarter. The base hire (USD 22,000/day) is being paid in advance and any additional hire is being paid in arrears. The minimum annual dividend based on the minimum rate is USD 1.35 per share. If there are payments of additional hire in excess of the timecharter equivalent of USD 22,000 per day, the shareholders will receive additional dividend" |
