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Is Tsakos Energy’s Fleet the Key to a Bright Future?

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Aug. 18 2020, Updated 5:26 a.m. ET

Tsakos Energy’s fleet

Tsakos Energy Navigation (TNP) has a fleet of 65 double hull vessels consisting of a mix of crude tankers, product tankers, and LNG carriers. Of these, 47 vessels are crude tankers—three VLCCs, 13 Suezmax tankers, 17 Aframax tankers, three Aframax LR, and 11 Panamax. The company stated that the average fleet age is 7.7 years. It’s lower than the average world fleet age of ten years.

Like Tsakos, Teekay Tankers (TNK) operates product tankers along with crude tankers, while Nordic American Tankers (NAT), Euronav (EURN), and DHT Holdings (DHT) only operate crude tankers.

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Newbuilds

Tsakos has taken delivery of eight new vessels since 3Q15. In 2016, it took delivery of VLCC Ulysses in May, Sunray—the LR1 product tanker, and its sister vessel Sunrise in late August and September 2016. All of these vessels are employed under long-term contracts.

The company also took delivery of four Aframax vessels—Elias Tsakos, Thomas Zafris, Leontios, and Parthenon. All four Aframax vessels are on a long-term contract.

The company also took delivery of Maria Energy—an LNG carrier. It was placed on a time charter contract at market rates.

In 2017, Tsakos will take delivery of seven newbuild tankers. All of these tankers are fully financed. Six of the seven vessels are already under long-term contracts, which would generate revenues of $745 million.

Tsakos secured many long-term contracts. Now, the company has 39 vessels contracted with an average employment tenure of 2.8 years. The company already secured 60% of the days in 2017 under contracts. Its contracted revenue is $1.4 billion.

Nikolas Tsakos, Tsakos Energy’s president and CEO, stated in its third quarter earnings release, “Following our long term strategy of responsible growth on the back of solid employment, 2017 will be the springboard year that will boost the fleet’s profitability and elevate TEN’s valuation to levels that reflect the true value of our company.”

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