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Agritrade Resources ventures into oil business with VLCC purchase

Agritrade Resources ventures into oil business with VLCC purchase
Coal mining firm Agritrade Resources has acquired a VLCC to diversify its business in view of the downward trend of coal mining business and brighter prospects for tanker shipping.

Hong Kong-listed Agritrade Resources completed the VLCC acquisition on 6 February and believed the deal would allow the company to establish a strategic oil infrastructure in the Southeast Asian region.

“In view of the growth in the global energy sector, strong market demand is foreseen for large crude carriers with the increasing consumption of oil in the future,” Agritrade Resources announced.

It “strongly believes that the VLCC vessel and oil storage business will have a very promising prospect and will promote the long term diversified growth of the group.”

Agritrade Resources added that it has been in active discussion and negotiation with several major oil trading companies for term storage contracts in relation to its oil storage business.

Rimau Shipping, an indirect wholly-owned subsidiary of Agritrade Resources, has entered into a banking facility letter with a bank for a five-year term loan facility of $15.4m or 70% of the purchase price of the VLCC.

TAGS: Tankers VLCC