The newbuilding will be constructed at South Korea’s Hyundai Heavy Industries (HHI), as are two more similar vessels under an earlier deal between Knot and BG struck in September 2014.
The latest option is one of two options that BG has been offered from last year’s deal. Following the current exercise of its option for this additional shuttle tanker, BG has a remaining option for one more unit.
The new shuttle tanker is slated to be delivered in mid-2017 and will commence operations under a time-charter with BG for a minimum of five years. If BG exercises all extension options, the vessel would operate under this charter for 20 years.
Going forward, Knot will be required to offer all three tankers to its New York-listed spin-off Knot Offshore Partners, which is not obligated to purchase any of them.
Knot is a joint venture of Japan’s NYK Line and Norway’s Knutsen OAS Shipping.
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