DryShips exercises second VLGC option

DryShips exercises second VLGC option

DryShips has exercised the second of four options it has to acquire VLGCs under construction at South Korea’s Hyundai Heavy Industries.

The vessel comes at a purchase price of $83.5m and delivery is expected around September 2017, when it will be employed on a five-year fixed rate time charter to an oil major who also has the option to extend for up to three additional years.

DryShips acquired the four options in a “zero cost” agreement with TMS Cardiff Gas, also controlled by Economou, in January and exercised the first option a few days later.

George Economou, chairman and CEO of DryShips, commented: “We are very pleased to have declared our second option to purchase a high specification VLGC with long term employment to an oil major at above market rates. This second investment in the gas carrier segment marks our confidence to the expected positive long-term fundamentals of the gas market and allows us to deploy the Company’s available liquidity immediately.”

DryShips says the time charter is expected to generate revenues of around $54.0 million based on the five-year charter, growing up to $92.7 million if the options are fully exercised.

Two weeks ago, DryShips further diversified by acquiring an under construction aframax tanker and 2001-built VLCC for trading on the spot market.

DryShips shares are currently trading at $1.31, which represents a drop of over 95% since the beginning of the year.

Grant Rowles

Grant spent nine years at Informa Group based in London, Sydney, Hong Kong and Singapore. He gained strong management experience in publishing, conferences and awards schemes in the shipping and legal areas, working on a number of titles including Lloyd's List. In 2009 Grant joined Seatrade responsible for the commercial development of Seatrade’s Asia products. In 2012, with Sam Chambers, he co-founded Asia Shipping Media.

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