Scrubbers to bring increased revenue for Greek owner

Paul Gunton
Paul Gunton
ShipInsight

01 November 2018


Installing scrubbers in some vessels in its fleet has allowed Greece-based shipowner Capital Product Partners (CPP) to achieve an increase in the daily rates for the vessels concerned.

It its Q3 financial report, the company revealed its plans for meeting the 2020 sulphur cap. CPP is planning to install scrubbers on up to 14 of its larger vessels, comprising ten containerships, three crude tankers and one bulk carrier. The final decision for certain of these vessels is expected to be reached within the coming months and the installation of the scrubbers is expected to be completed throughout 2019 and 2020.

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The report went on to say that in connection with the agreement to equip five 5,000teu container vessel with scrubbers, the charterer Hyundai Merchant marine has agree to an increase of the daily rate. The increase will be effective from January 1, 2020, or, if later, the installation date of the scrubbers until the expiry of each charter in 2024 and 2025, as applicable. The HMM Vessels are currently earning $23,480 gross per day following a restructuring agreement with HMM dated July 15, 2016.

Under the restructuring agreement, the charter rate is set to be restored to the original daily gross rate of $29,350 from January 1, 2020 and will increase further to $34,250 once the scrubbers are installed in accordance with the Scrubber Agreements.

Jerry Kalogiratos, Chief Executive Officer said “We believe that our decision to equip part of our fleet with scrubbers is an important and necessary decision in view of the IMO 2020 regulation, whose effects on our underlying markets remain widely debated in the industry. We believe that this move can help increase the appeal of the Partnership’s larger vessels to period charterers post January 2020, but also potentially allow us to capture meaningful premiums, such as that negotiated with one of our charterers for five of our vessels.”