INVESTOR PRESENTATION PRESENTATION ITMMA Marine Money Week 27 MARCH 2012 New York, JUNE 2012 1
Investment Highlights • Leading crude tanker company Young diverse fleet of 44 ships under control Balanced strategy between contracts and spot market Well positioned to take advantage of offshore market • Strong financial position No need to raise substantial financing until 2014 Diversified lender’s group Public company able to diversify source of funding • Experienced Management Team Two successful shipping families (Saverys – Livanos) 70 years of combined management experience 2
2 . Strategy 1. STRATEGY 2. Strategy 3
A Focused Fleet Vessel Type Euronav owned TC-IN (Weighted) FSO 2 x 50% V-PLUS 1 0 VLCC 12 (2 CSR) 6 incl. JV 11+ (2 x 1/2 in J/V) (weighted 3,65) SUEZMAX 22 (16 ice class) 0 (4x 1/2 in J/V) New Building Suezmax 1 (CSR) Total = 44 Ships Mix of spot and + 1 Newbuilding Fixed contracts
Financing sources Preference for Shipping banks … … but as straight banking finance is drying up It is important to be a public company that can tap alternative source of financing: - Bond markets - US High Yield - Norwegian Bond market - Convertible Bonds - Equity markets 5
Financing in the middle of a banking crisis • Main Facility: USD 750M Maturity: 2018 Revolver of up to USD 250M • FSO Financing: USD 500M Maturity: 2017 • JV Vessels (4 Suezmax) Maturity: 2020 - 2021 • 2009 Facility: USD 300M Maturity: 2014 • Convertible bond in 2009 Maturity: 2015 USD 150M Coupon: 6.5% - Strike price: €16.2838 6
Commercial Balanced Strategy Fixed term contracts Pooling arrangements Proprietary spot desk 7
A Balanced Strategy 2011/ YTD 2012 onhire days 543 2012 2011 1,689 13% 14% 2,247 53% 6,148 49% 1,421 4,639 34% 37% fix fix/ps spot fixed fixed-ps spot Break-even Of which OPEX Fixed Contract Backlog 2012: $200m $ 31,750 $ 8,800 VLCC $ 26,600 $ 7,800 Suezmax 8
Clients of Euronav 9
TI POOL Euronav 2,735,679 dwt GC Tankers Reederei “Nord” 912,891 dwt 638,187 dwt Oak Maritime (HK) Athenian Sea Carriers 610,439 dwt 1,269,764 dwt DHT Holdings, Inc Overseas Shipholding Group 605,438 dwt 3,679,703 dwt
SUEZMAX SPOT outperforming the market TCE/day 2011 2012 Q1 Q2 Q3 Q4 Q1 Euronav 13,519 14,778 15,100 15,750 24,272* Teekay 18,671 17,461 8,289 12,641 24,847 Frontline 16,000 14,500 7,800 12,400 19,500 GenMar 16,768 14,490 8,608 ** ** NATS 18,000 16,600 8,000 12,777 17,500 OSG 16,065 13,630 15,123 12,408 24,900 * Excluding Newbuilding voyage delivery ** Since charpter 11 no releases have been issued 11
2. The Market… …are the fundamentals changing? 12
OIL DEMAND AND Demand PRODUCTION 13
World Oil Demand • Oil demand in 2011 fell 0.15 mbpd => 1.2 million bpd • IEA increased world oil demand 2012=> 0.9% • Demand mainly supported by non OECD countries.
Oil demand growing 15
Oil demand falling Source: IEA
Suezmax Trading Pattern… …is dramatically changing and adding Ton-Miles AG Suezmax Liftings WAF Suezmax Liftings 80 2009-2011 2009-2011 60 35 30 2009 40 25 2009 2010 20 2010 20 15 2011 10 2011 2012 0 5 2012 0 Black Sea Suezmax Liftings 30 2009-2011 25 20 2009 15 2010 10 2011 2012 5 0 Source: Euronav Database
Venezuela-China impact on VLCC demand VENEZUELA has voted to double the amount of money repayable in oil that it borrows from China, in a move that will boost longhaul tanker shipments on the Americas to Asia trade route Very large crude carriers will gain most from Venezuela agreeing to increase its borrowing from $4bn to $8bn, experts said on Thursday. This trade has made up around 18% of tonne-mile demand for VLCCs so far in 2012. 18 Data source: Clarksons / LLI / GTIS. Tonnes discharged represents total volume on all vessel sizes. Shipments, trade and vessel demand are for crude oil transportation only (excluding fuel oil trade).
Large Tanker Supply 3. Tanker supply 19
Tanker fleet Vs Oil demand 20
VLCC fleet developement VLCC Fleet Development - Base Case Basis TUKA VLCC Database Fleet at DH SH NBs DH Exit SH Exit Total Exit SH to DH Growth Growth % year start 2007 483 322 161 29 1 21 22 4 7 1.4% 2008 490 354 136 42 3 35 38 3 4 0.8% 2009 494 396 98 53 2 31 33 3 20 4.0% 2010 514 450 64 60 2 42 44 3 16 3.1% 2011 530 511 19 65 6 14 20 1 45 8.5% 2012 575 571 4 52 22 2 24 0 28 4.9% 2013 603 601 2 59 16 0 16 0 43 7.1% 2014 646 644 2 23 16 0 16 0 7 1.1% 2015 653 651 2 17 12 1 13 0 4 0.6% 2016 657 656 1 16 12 0 12 0 4 0.6% 2017 661 660 1 20 12 0 12 0 8 1.2% 2012YTD 579 575 4 11 7 0 7 0 4 0.7% Rest of Year 41 15 2 17 0 24 4.1% Reference Date: 1 Mar 12 21
Suezmax fleet developement Suezmax Fleet Development Souce: Clarksons Fleet at DH SH NBs Total Exit Growth Growth % year start 2007 343 275 68 25 12 13 3.8% 2008 356 300 56 14 11 3 0.8% 2009 359 313 46 45 15 30 8.4% 2010 389 356 33 41 18 23 5.9% 2011 412 395 17 41 8 33 8.0% 2012 445 436 9 64 0 64 14.4% 2013 509 500 9 48 0 48 9.4% 2014 557 548 9 11 0 11 2.0% 2015 568 559 9 0 0 0 0.0% 2016 568 559 9 0 0 0 0.0% Reference Date: 1 Mar 12 22
Orderbook A balance VLCC Fleet by year built 70 60 50 40 54 55 61 26 30 20 40 39 37 36 29 31 29 37 2 30 26 10 21 16 6 13 20 20 11 2 1 1 4 9 7 2 0 -12 -5 -8 -13 -10 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -20 Suez Fleet by year built 70 60 50 43 40 30 53 45 41 42 20 21 24 24 27 25 26 25 14 22 16 23 10 14 7 8 8 8 11 4 1 0 1 -5 -8 -12 -13 -10 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Supply of ships in perspective 24
Issues influencing 4. Factors influencing the Large Tanker Supply tanker market tanker market 25
Q U A L I T Y reliable reputable sustainable dynamic modern innovating
The power of slow steaming Full Eco Super Speed Speed Slow Laden/Ballast 14/15 14/13 14/10 (knts) Bunkers $ 2,679,600 2,505,300 2,162,160 Days 38.28 41.12 47.52 TCE $ 10,300 13,830 19,188
Power of slow steaming 28
Scrapping prices 29
VLCC Storage… artificially… …increased by IRAN ban 30
Piracy 31
10 20 30 40 50 60 0 02/07/2010 02/08/2010 Average Earnings VLCC and Suezmax 02/09/2010 02/10/2010 02/11/2010 02/12/2010 Suezmax and VLCC Average Earnings 02/01/2011 Source: Clarkson Research Services Limited 02/02/2011 July 2010 - YTD 02/03/2011 02/04/2011 02/05/2011 02/06/2011 02/07/2011 02/08/2011 02/09/2011 02/10/2011 02/11/2011 02/12/2011 02/01/2012 02/02/2012 02/03/2012 02/04/2012 02/05/2012 02/06/2012 32
5. OFFSHORE SERVICES MARKET 33
Offshore Market 34
Market Overview • Annual growth 5-10% • Most FSO/FPSO contracts are extended into option periods • Alternatively redeployed on new contracts • The complexity and size of new FSO/FPSO are increasing • Leased vs Owned – 50/50 35
FSO/ FPSO The preferred Solution • Flexible, safe and proven solution • Generic or field specific • Deck space and deck load capacity • Storage Capacity • Self propelled marine unit Source: IMA 36
Finding the right investment EURONAV PROJECT PRE QUALIFICATION + EXPERIENCE + CONVERSION OPERATION FINANCIAL CAPABILITY + PROJECT & RISK FINANCING MANAGEMENT + PROCUREMENT 37
More than 210 Floater Projects in the planning pipeline…. 257 floating prodcution systems in service 57 production floaters on order 210 floater projects in the planning pipeline 38
Offshore Strategy 39
Offshore Strategy • 2012: Set up of a dedicated offshore department. • Focus on FpSO units (Floating Storage Offloading) with small (p) production topsides for platform fluids treatment • Select vessels from our trading fleet when: – Becoming more difficult to trade due to age restrictions (older VLCC (1999) and older Suezmax (1998) – have unique characteristics: V+ or Cap Diamant • Use of experienced sub contractors for providing design, engineering and mooring systems . 40
In Operation • FSO Asia and FSO Africa delivered to MOQ in 2010 • FSO characteristics: - Storage Capacity: minimum 2,400,000 barrels of dry oil for export - Stripped Water Capacity: minimum 200,000 barrels - Custody transfer to off-take tanker: 90,000 BPH - Discharge to export vessel every 2 to 3 days: in tandem mooring or in STS operations - FSO Crew - 52 persons; FSO accommodation for platform shift workers up to 84 personnel 41
In Tender Phase • Dagny and Heidrun project for Statoil in North Sea 2 FSO Suezmax size. • Replacement of FSO Ta’kuntah for Pemex in the GoM: FSO Africa or Vplus or VLCC size • Buque Tanque, for Pemex for Bay de Campeche Suezmax size 42
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