With its restructuring all but wrapped up, Gulf Navigation Holdings is looking to expand with more ships.
Although the company has a mixed fleet of five chemical tankers, a livestock carrier and a well stimulation vessel, future growth will be purely in the tanker sector, according to chief financial officer Ali Abouda.
The five chemical tankers are tied up on long-term time charters, with four on charter to Saudi Basic Industries Corp, known as Sabic, and one to Asian interests. This will keep most of them busy for at least the next two years.
The Sabic quartet is set to conclude 15-year charters in 2023 and 2024, and Abouda is confident that options to renew for a further five years will be declared.
“I don’t see why Sabic would not renew. They are very well-built, high-standard vessels,” he said.
Chief executive Ahmad Kilani added that even if Sabic opted not to renew, these vessels would still be able to get good charters in the market.
Meanwhile, Gulf Navigation wants to acquire two more tankers in the short term, in part to give it more exposure to the spot market.
“We need to take a risk on the spot market so that we do not lose the opportunities there,” Abouda said.
MR and LR chemical/product tankers are Gulf Navigation’s target.
“We have good experience in this sector, with an established client base,” Abouda added.
Kilani is “very bullish” about the MR chemical tanker sector, as scrapping is outpacing newbuilding deliveries. “I believe the increase in the market is sustainable and will continue,” he said.
Gulf Navigation’s preference is for ships that already meet the International Maritime Organization’s 2030 emissions regulations.
“We want eco vessels that are at the stage where they don’t need any upgrades. This means young vessels of between five and six years. We may even consider a newbuilding resale if that makes sense,” he said.
Abouda revealed that a few potential transactions are being studied, and Gulf Navigation is open to partnering other players in the market: “If all goes well, we expect to close a deal by the end of the fourth quarter of this year, or the first quarter of 2023.”
No further investments in the livestock transport and offshore sectors are planned. The company aims to exit these sectors at an opportune time.
