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TORM REFINANCES TANKER FLEET WITH LINKS TO CO2 REDUCTION

TORM REFINANCES TANKER FLEET WITH LINKS TO CO2 REDUCTION

Monday, March 1, 2021 

Denmark-based tanker company Torm has published its annual report for 2020, which gives an insight into the company's environmental actions.

During the year, Torm carried out a refinancing programme, adding to its existing facility with Danish Ship Finance a new facility of US$180m, covering 10 vessels. A CO2 emission-linked pricing mechanism was included in the Danish Ship Finance facility. Accordingly, the pricing is linked to the reductions in CO2 emissions year-on-year, aligning it with Torm’s and the IMO’s industry target of a 40% reduction in greenhouse gas emissions by 2030. The key performance indicator and the decarbonisation target are consistent with the Poseidon Principles, the global framework by which a number of leading financial institutions assess the climate alignment of their ship finance portfolios. The agreement is TORM’s first loan agreement that includes a CO2 emission-linked price adjustment mechanism.

Torm has committed to install 50 scrubbers. As of 1 March 2021, TORM has installed 46, with the remaining four expected to be installed in 2021 and in the first quarter of 2022, including two scrubbers for LR2 newbuildings. Torm has obtained financing of US$12m related to the installation of scrubbers and Ballast  Water Treatment Systems on these four vessels.

As of 31 December 2020, TORM’s fleet consisted of 64 owned vessels, eight vessels under sale and leaseback agreements, two vessels on order and one second-hand vessel soon to be delivered. Torm has just entered into an agreement with Team Tankers to acquire eight 2007 to 2012-built MR product tankers which will be handed over during the second and third quarters of 2021.

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