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Frontline 2012 into the red, newbuild orderbook grows

Frontline 2012 into the red, newbuild orderbook grows
John Fredriksen’s Frontline 2012 fell into the red in the first quarter of the year. Frontline 2013 reported a first quarter net loss of $4.8m, the shipowner made a $700,000 profit in the final quarter of last year.

Frontline 2012 has a major newbuilding programme of $2.77bn for  58 vessels As of the end of March the company had 53 newbuildings on order comprising 18 within the crude oil and petroleum product markets, 24 capesize vessels, eight very large gas carriers or VLGCs and three VLCCs. Since then it has added a further six newbuildings, and cancelled one VLCC.

Frontline 2012 holds further fixed price options and is negotiations with yards for more newbuildings. The company said it was “following the situation closely” regarding 14 newbuildings it has on order at the financially troubled STX (Dalian) Shipbuilding.

On the general outlook for shipping Frontline 2012 remained negative and its board said it was of the opinion, “That several of the shipping markets are massively oversupplied today and that it may take some time before a reasonable market balance is restored.”

There was confidence about the LPG carrier market though and it said: “This market appears well balanced and there are clear signs that positive developments have started. This trend is driven by increased LPG production as well as new trading patterns mainly driven by development in the US.”

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