Scorpio Goes on ‘Eco’ Binge

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December 11, 2012

NYSE-listed Scorpio Tankers Inc. (STNG), a global provider of marine transportation of petroleum products, on Monday announced that it has ordered a total of 6 new eco-friendly Medium Range product tankers.

Scorpio says that the first two newbuilds were ordered as existing options from Hyundai Mipo Dockyard Co. in South Korea. Scorpio signed a letter of intent with SPP Shipbuilding Co., also of South Korea, for the remaining four ships.

The six newbuildings are scheduled to be delivered in the second and third quarter 2014. The company also has fixed-price options to construct eight additional tankers. Scorpio says that the contract price for each of the newbuildings and fixed-price options is approximately $33 million.

Emanuele Lauro, chief executive officer and chairman of the board commented, “We are pleased to announce the agreements for six additional ‘eco’ newbuildings, plus fixed-price options, subsequent to our recently completed equity offering. We are delighted by the support of our shareholders as we establish a leading position in the product tanker market. As we approach what is traditionally the strongest season, we are seeing stronger rates across all of our sectors.”

Last week the company offered 21.6 million shares of its common stock priced at $6.10 to raise $131.8 million. The offering was expected to extend through Monday, December 10th.

Scorpio Tankers Inc. currently owns one LR2 tanker, four LR1 tankers, one Handymax tanker, five MR tankers, and one post-Panamax tanker with an average age of 4.7 years, time charters-in 18 vessels (three LR2, three LR1, seven MR and five Handymax tankers), and has contracted for eleven newbuilding MR’s (three are expected to be delivered to the Company in the first half of 2013 and the remaining eight by the end of September 2014).

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