The most environmentally friendly shuttle tankers ever built

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SANDS has acted as Norwegian legal counsel to Macquarie Bank as ECA agent and ABN Amro Capital LLC as Agent for lenders of a US $414 million long-term debt facility that will be used to finance four LNG-fueled Suezmax DP2 shuttle tanker newbuildings for Teekay Offshore Partners L.P. Upon delivery in 2019 and 2020, two of the vessels will commence operations under the Partnership’s Master Agreement with Equinor, while the remaining two vessels will join the Partnership’s contract of affreightment shuttle tanker portfolio in the North Sea. The new facility is funded and guaranteed by both Canadian and Norwegian export credit agencies.
Wednesday, April 10, 2019

The new and innovative shuttle tanker design will significantly reduce emissions and fuel consumption. The 130,000 dwt vessels will operate on both liquefied natural gas (LNG) as the primary fuel, and a mixture of LNG and recovered volatile organic compounds (VOCs) as secondary fuel. The E-Shuttle has battery packs for flexible power distribution and blackout prevention. It reduces bunkering requirement and CO2 emissions by approx. 50%’ instead of ‘annual emission reduction potential is estimated at up to 42%, with fuel consumption reduced by up to 22% compared to traditional shuttle tankers.

“We were pleased to advise the syndicate led by ABN and Macquarie and work with Teekay on this important transaction”, says Ylva Cornelia Axelsen, partner at SANDS. “Financing of these state-of-the art newbuild vessels will set market precedent for future financings, particularly in view of the upcoming IMO’s regulations. It has been very interesting to learn more about how these new “E-Shuttles” use their own emissions as fuel, and to advise on the legal aspects of technical installations like the VOC plants to be used on the vessels for that purpose”.

Our team consisted of Ylva Cornelia Axelsen (lead partner), Jørn Snorre Øvstedal (partner), Camilla Barr (senior associate), Sonja Lorentzen (associate) and Caroline Langtangen (legal assistant).

For questions, please contact
Ylva Cornelia Axelsen (partner)

Sources: Teekay.com

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