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Speaker 1: Hi everyone, and welcome to Bloomberg Intelligence Talking Transports podcast.

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Speaker 1: I'm your host, Lee Klasgow, senior Freight, transportation and Logistics

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Speaker 1: analysts at Bloomberg Intelligence, Bloomberg's in house research arm of

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Speaker 1: almost five hundred analysts and strategists. Before diving in a

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Speaker 1: little public service announcement, your support is instrumental to keep

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Speaker 1: bringing great guests onto the podcast like the one we

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Speaker 1: have today. If you haven't already, please do take a

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Speaker 1: moment to follow rate and share the Talking Transports with

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Speaker 1: all your friends and colleagues. We appreciate your support. I'm

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Speaker 1: very excited to have Mikhail school Hofnia's or CEO. Hafnia

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Speaker 1: is a major owner and operator of product tankers. It

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Speaker 1: can be found at haf and I Space NL on

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Speaker 1: the Bloomberg terminal. The company has a market cap about

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Speaker 1: four billion dollars. Mikau is the co founder of Hafnia

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Speaker 1: Tankers and has over thirty nine years of ag experience

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Speaker 1: in the shipping industry. Prior to establishing Hafna, Mikhal held

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Speaker 1: various positions over his twenty five year career at TOM,

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Speaker 1: of which over the last two years he served as

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Speaker 1: its CEO. He's also a board member of the clipper

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Speaker 1: Group zero North and additionally serving as the co chair

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Speaker 1: of the all Aboard Alliance and initiative of the Global

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Speaker 1: Maritime Forum aimed at increasing diversity, equity and inclusion in

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Speaker 1: the maritime industry. Welcome to the Talking Transports podcast, Mikaal.

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Speaker 2: Thank you, it's great to have you.

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Speaker 1: So, you know, Hafnia might not be a household name

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Speaker 1: for everyone that's listening today, could you tell a little

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Speaker 1: bit about the company?

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Speaker 3: Absolutely, and well, Halfnae is primarily a leading player in tankers,

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Speaker 3: which are Tanka visas that are sailing globally with refined

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Speaker 3: oil products. So that's basically that's our core business and

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Speaker 3: that's what the company has been built around. It's a

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Speaker 3: relatively young company, as you just mentioned, so we were

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Speaker 3: founded in late twenty ten, twenty eleven, and you know,

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Speaker 3: has ever since grown quite a lot. I should probably mention,

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Speaker 3: just in addition to what you said, that we are

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Speaker 3: listed in Arsenal Stockage Change. That is correct, but we

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Speaker 3: also earlier this year introduced a dual listing, so we

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Speaker 3: are now also listed in New York on the New

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Speaker 3: York Stock Exchange, so we have two listings now. For

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Speaker 3: the company, which is quite exciting and Kata's really for

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Speaker 3: two very important investor pools in the world when it

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Speaker 3: comes to the maritime industry.

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Speaker 1: Okay, great, and so you mentioned, you know, product tankers.

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Speaker 1: Could you talk a little bit more details about what

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Speaker 1: types of ships you have in your fleet. Is there

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Speaker 1: a certain size that you focus on or do you

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Speaker 1: do all sorts of product tanker ships.

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Speaker 3: Yeah, so we're basically involved in all sizes of the

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Speaker 3: product tanker segment, So that goes all the way from

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Speaker 3: the smallest.

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Speaker 2: Specialized vessels as.

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Speaker 3: We call them, all the way up through the handy size,

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Speaker 3: the medium rain and the long range, which all reflect

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Speaker 3: really different sizes of ships that are sailing with a

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Speaker 3: variety of refined oil products and primarily would be gasoline,

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Speaker 3: diesel oil, gas oil, jet fuel and NAFTA, so all

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Speaker 3: products that we know from our daily life using either

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Speaker 3: as heating oil or for transportation in our cars or

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Speaker 3: for jet fuel when you're flying airplanes.

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Speaker 2: We're operating a modern fleet.

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Speaker 3: So the average age of our fleet is only eight

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Speaker 3: point three years, which is one of the youngest compared

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Speaker 3: to the entire product tank of fleet, which on a

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Speaker 3: worldwide basis is around thirteen to fourteen years of average age.

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Speaker 3: So we think that's an important part because the world

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Speaker 3: is at the moment in a strong focus of decarbonization.

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Speaker 3: So having modern and younger ships also means that you

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Speaker 3: have a more efficient fuel economy and therefore you have

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Speaker 3: lower emissions and therefore you have lower environmental footprint. So

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Speaker 3: that's how that goes into contact.

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Speaker 1: And how many ships do you guys own and operate?

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Speaker 3: So we own at the moment, I own and financially

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Speaker 3: control one hundred and thirty vessels, but we operate which

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Speaker 3: includes vessels that we operate on behalf of other owners

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Speaker 3: around two hundred and twenty vessels altogether.

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Speaker 1: Okay, that's a pretty big fleet for the product anchor market.

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Speaker 1: And what kind of I guess economies of scale does

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Speaker 1: a product tank or fleet get when you if you

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Speaker 1: want to bring in another ship into the fleet. Are

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Speaker 1: there a lot of economies of scale or it's just

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Speaker 1: really just not so much in the product anchor market.

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Speaker 3: No, I think we think that there are a lot

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Speaker 3: of economy of scale advantages by having a large fleet.

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Speaker 3: And the way you should probably look at it is

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Speaker 3: that what we transport, as I mentioned earlier gasoline, disloyaled gas, ar, etc.

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Speaker 3: Is something which is consumed all over the world. So

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Speaker 3: this is a global trade of global commodity. So if

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Speaker 3: you want to optimize your business, you obviously want to

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Speaker 3: be in the areas of the world where the markets

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Speaker 3: are good and where you make the most money. So

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Speaker 3: the only way you can do that is to have

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Speaker 3: a large fleet that really allows you to position your

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Speaker 3: vessels and have them present almost all over the world

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Speaker 3: so that you can take advantage of knowledge of even

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Speaker 3: the smaller markets around and make sure that if you

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Speaker 3: like your consolidated knowledge about the market, it's being used

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Speaker 3: to position the ships where there is the most need

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Speaker 3: for them and also where you can optimize on your earnings.

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Speaker 3: So as a last comment to it, our market is

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Speaker 3: very volatile, so having scale and be able to move

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Speaker 3: around is super important because our markets do fluctuate quite

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Speaker 3: a lot. Because it's also linked to what happens in

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Speaker 3: the oil market. So if people have a look at

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Speaker 3: the volatility and the fluctuation of oil prices, you can

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Speaker 3: kind of in a way, drag that across to our trade.

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Speaker 2: That's how our freight rates move up and down all

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Speaker 2: around the world.

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Speaker 3: So very important and lots of advantages of having scale.

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Speaker 1: What's going on in the world has definitely impacted trade

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Speaker 1: and trade lanes within shipping, and I'm sure product to

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Speaker 1: anchors are no different. Can you talk about the impact

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Speaker 1: of Russia's war in Ukraine and maybe the crisis in

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Speaker 1: the Red Sea, how that has impacted not only your operations,

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Speaker 1: but you know, rates in general.

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Speaker 3: Absolutely, so, I think if we start with the Russian

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Speaker 3: invasion of Ukraine, there's no doubt that the immediate introduction

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Speaker 3: of sanctions that follow afterwards meant that a lot of

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Speaker 3: the oil that originally came from Russia into Europe, and

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Speaker 3: these were very short distances as you can imagine, coming

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Speaker 3: from the Baltic Sea into the Northern Europe is not

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Speaker 3: a very long voyage for a vessel. They were replaced

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Speaker 3: suddenly by oil coming from the Middle East or the

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Speaker 3: Far East or the US Gulf going into Europe. So

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Speaker 3: vessels were sailing longer to replace those shorter voyages once

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Speaker 3: the sanctions went in place.

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Speaker 2: So this had a positive effect.

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Speaker 3: On transportation in general because our vessels was basically sailing

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Speaker 3: longer with the same amount of oil. So that increased

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Speaker 3: what we call the ton mile I eat, the distance

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Speaker 3: that you are transporting oil to its destination. So that

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Speaker 3: had a positive impact on the market that you certainly

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Speaker 3: had a sanction on Russian oil. I think what I

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Speaker 3: want to add to it is that I think where

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Speaker 3: we are now is it's very difficult to imagine that

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Speaker 3: that will ever come back to it.

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Speaker 2: It was.

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Speaker 3: Again, we think that the energy crisis which followed that

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Speaker 3: invasion has clearly shown that that Northern Europe and European

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Speaker 3: general were two depending on Russian oil and gas. So

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Speaker 3: now we don't think that we're going to go back

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Speaker 3: to a normalization as we saw it before that invasion,

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Speaker 3: i e. With the shorter distances of transportation. So we

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Speaker 3: think that benefit is here to stay for a long time.

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Speaker 1: Very interesting. And then on the Red Sea aspect, are

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Speaker 1: your ships traversing through the Red Sea in this with

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Speaker 1: canal or you guys totally avoiding that for safety concern?

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Speaker 3: Yeah, so we are totally avoiding that. So none of

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Speaker 3: our vessels are going through that area. All of our

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Speaker 3: vessels that has to go that way would either transit

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Speaker 3: via the Cave of Good Hope or either Panama Canal,

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Speaker 3: depending on which kind of routing you're taking. It is

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Speaker 3: definitely not safe to send vessels to the Red Sea

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Speaker 3: at the moment, And as you correctly said, I think

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Speaker 3: you know, the safety of the crew is obviously one

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Speaker 3: of the optimal priorities for us, and therefore it's not

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Speaker 3: a difficult decision to stay away from an area where

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Speaker 3: there's definitely.

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Speaker 2: Not a safe place to be for your colleagues at sea.

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Speaker 3: Yeah.

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Speaker 1: I mean, so these two geopolitical events have really increased

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Speaker 1: ten miles for marine shipping and product tankers. So what

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Speaker 1: has that done for rates? And then can you talk

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Speaker 1: about you know, because these are shocks and then there's

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Speaker 1: obviously in the backdrop there's a positive as to rates

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Speaker 1: because the the order book is relatively low. So could

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Speaker 1: you talk about you know, the order book, where you

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Speaker 1: see the order book going and and how is that

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Speaker 1: you know, good for rates in general? And I guess

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Speaker 1: just really if you can any insights into where you

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Speaker 1: see product anker rates going from here, And then I'm

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Speaker 1: gonna add another question within these questions. You know, is

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Speaker 1: there a sub segment within product tankers? Is it you

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Speaker 1: know m rs or l ones, l R ones or

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Speaker 1: l R two's that are that are leading the way.

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Speaker 2: Yeah, so if I start with the Red c for sure.

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Speaker 3: Yes, So if instead of transiting the Red C you

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Speaker 3: suddenly have to go y the Cave of Good Hope,

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Speaker 3: you again adding onton my longer distance for the vessels

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Speaker 3: to sail. So it was the same effect that we

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Speaker 3: saw after the Russian sanctions that basically there was that

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Speaker 3: was fuel ships available for the market, then then before

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Speaker 3: when the Red Sea was open, So that has increased

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Speaker 3: the freight rates as well. So there's no doubt that

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Speaker 3: those two things in combination have had a positive effect

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Speaker 3: on freight rates for product tankers in general. I would

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Speaker 3: though highlight that before we got to that point, we

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Speaker 3: were already in a very strong market. I mean, before

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Speaker 3: the Red Sea conflict started, we were already facing historically

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Speaker 3: high earnings in the product tanker segment. So the reason

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Speaker 3: for that is to your third question, I think was

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Speaker 3: that we've been through a period primarily during the pandemic

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Speaker 3: and shortly after where we all underinvested in assets to

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Speaker 3: transport oil, but also in production of oil in general.

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Speaker 3: So I think there was a general view during that

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Speaker 3: period that the transformation into renewable and green energy would

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Speaker 3: happen overnight, and therefore nobody wanted to touch anything related

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Speaker 3: to oil and gas. So I think what we're seeing

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Speaker 3: now is the effect of three to four years of

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Speaker 3: no investments in new ships and not no substantial investment

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Speaker 3: in oil and gas production. And what that has meant

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Speaker 3: is oil and gas demand basically came back to the

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Speaker 3: level before the pandemic.

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Speaker 2: Very very quickly. So the pressure on freight.

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Speaker 3: Rates and pricing in general has just been substantial because

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Speaker 3: we have been lacking behind.

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Speaker 2: So we were.

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Speaker 3: Actually already in a peared where we could see that

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Speaker 3: supply and demand in the product tanker market was much

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Speaker 3: in favor of the owners. There were simply too few

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Speaker 3: ships to cover the demand of oil that needed to

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Speaker 3: be transported, I guess.

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Speaker 1: Going forward, so if let's say the crisis in the

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Speaker 1: Red Sea goes away and ships are able to go

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Speaker 1: through the West Canal, how is that going to impact rates?

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Speaker 1: Is that going to make rates drop considerably or do

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Speaker 1: you think there's some support there because of the order book?

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Speaker 2: No.

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Speaker 3: I think for sure that the benefit that we got

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Speaker 3: from the fact that we were traveling longer after the

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Speaker 3: closure of the Red Sea, obviously some of.

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Speaker 2: That would be rolled back.

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Speaker 3: So there's no doubt that once you have a completely

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Speaker 3: normal situation, you'll have shorter tom mind than before. So

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Speaker 3: we do think there will be some correction in freight rates.

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Speaker 3: But what we've seen in the meantime is that four

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Speaker 3: new refineries in the world over this year has now

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Speaker 3: rammed up their production and export capacity, which means that

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Speaker 3: we are seeing more refined oil coming out from new

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Speaker 3: refineries that needs to travel longer distances.

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Speaker 2: So we do think that what we will be losing

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Speaker 2: on one side will most likely be replaced by the

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Speaker 2: fact that there's.

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Speaker 3: New refineries adding more export capacity to the market. And

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Speaker 3: then we are just coming closer to this very important

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Speaker 3: factor in the shipping market, which is that the fleet,

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Speaker 3: the older part of the fleet that was built in

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Speaker 3: two thousand and four to two thousand and eight, is

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Speaker 3: coming very close to scrapping, and that's a significant amount

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Speaker 3: of the fleet. One thing, if you go back and

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Speaker 3: analyze the shipping market over thirty five years, forty years,

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Speaker 3: I just gave away my age. Well I think you

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Speaker 3: did probably already before that. But if you do that,

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Speaker 3: you will see that we have never ever had a

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Speaker 3: demand problem in our industry. Never we've had increasing demand

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Speaker 3: for inspectation of oil as long as I can remember back.

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Speaker 3: Every single time the market has been bad, it has

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Speaker 3: been because owners have gone out and almost oversupplied the

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Speaker 3: market with vessels that they've built after have made a

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Speaker 3: lot of money in a strong market. That's why it's

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Speaker 3: different this time is that we haven't done that, and

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Speaker 3: and and even if we wanted to, it's impossible.

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Speaker 2: Now we simply it's too late.

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Speaker 3: And that's what makes people positive about the market is

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Speaker 3: you simply cannot overbuild it going forward, right And a lot.

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Speaker 1: Of that has to do with a lot of the

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Speaker 1: shipyards that are out there. They're they're busy building container liners.

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Speaker 2: Gas ships and everything else. Very true.

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Speaker 1: So you know, I guess we're seeing rate volatility that

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Speaker 1: that's gonna that's gonna be something that's gonna hit the

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Speaker 1: market all the time. The impact to your earnings are

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Speaker 1: going to be dependent on you know, how much of

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Speaker 1: that business that you have is contract versus spot? Can

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Speaker 1: you talk about the next of your business? You know,

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Speaker 1: what what is it? How much is contract versus spot?

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Speaker 1: And if in the contract, what's a typical contract? Is

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Speaker 1: it one year? Is it three years?

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Speaker 2: Is it.

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Speaker 1: You know, how long are those contracts?

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Speaker 2: So halfna.

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Speaker 3: In general, we've always believed in the you know, in

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Speaker 3: the business strategy of having the majority of our vessels

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Speaker 3: in the spot market. And if you want to have

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Speaker 3: vessels in the spot market as a as a prime strategy,

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Speaker 3: you need to have scale, as we talked about in

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Speaker 3: the beginning of this.

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Speaker 2: So that kind of goes well together.

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Speaker 3: So we would at the moment, or probably at any

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Speaker 3: given time, where we have a firm belief in the

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Speaker 3: market going forward, we wouldn't have covered of a lot

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Speaker 3: more of maybe five to ten percent of our fleet,

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Speaker 3: and that would typically be anything from twelve to five.

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Speaker 2: Years out that you would have that we would have

283
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Speaker 2: that coverage.

284
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Speaker 3: But you know, in a normalized market where we believe

285
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Speaker 3: that the spot market will continue to be strong, we

286
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Speaker 3: would have up to ninety percent of our fleet in

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Speaker 3: the spot market.

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Speaker 1: Wow, okay, And so right now, is that is that

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Speaker 1: where you are?

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Speaker 2: That's where we are? Uh? Yeah.

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Speaker 3: And if you look back over over time through the

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Speaker 3: cycles and try to compare the strategies and kind of

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Speaker 3: compare what if you're spot over a long period of

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Speaker 3: time through the cycles versus you keep on chartering your

295
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Speaker 3: vessels out or leasing them out to other people at

296
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Speaker 3: fixed earnings. There's no doubt that the benefit from being

297
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Speaker 3: spot is larger than the covered side. But of course

298
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Speaker 3: it goes along with volatility, so you have to be

299
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Speaker 3: able to sustain the low point of.

300
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Speaker 2: The cycle of course to have that strategy. But if

301
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Speaker 2: you have a.

302
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Speaker 3: Strong balance sheet, the spot market strategy over time will

303
00:15:28,760 --> 00:15:31,480
Speaker 3: give you higher earnings. Then if you keep on leasing

304
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Speaker 3: shifts out on a permanent basis.

305
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Speaker 1: Would you say, is that a normal thing for a

306
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Speaker 1: large product tanker operators to be more in the spot

307
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Speaker 1: market through the cycle.

308
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Speaker 3: Yes, in general, yes, I would say the largest competitors

309
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Speaker 3: to HAFNIA follow a similar strategy.

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Speaker 2: Yeah.

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Speaker 1: You know you mentioned earlier when we were talking about

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Speaker 1: the Red Sea going through the Panama Canal. You know

313
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Speaker 1: there were some issues with water levels at Panama. I

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Speaker 1: know that's gotten a little better. I'm just curious and

315
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Speaker 1: I think, you know, some people might that are unfamiliar

316
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Speaker 1: with the market in the tanker market. Do all of

317
00:16:03,040 --> 00:16:05,640
Speaker 1: the product tankers are they all able to fit through

318
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Speaker 1: the Panama Canal or there's some sized restrictions in terms

319
00:16:09,160 --> 00:16:11,200
Speaker 1: of which ships can go through the Panama Canal from

320
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Speaker 1: a product tanker standpoint.

321
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Speaker 3: So at the moment, you know, basically the largest product

322
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Speaker 3: tankers that go through at the moment are the allow

323
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Speaker 3: ones long range one, which have what you call a

324
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Speaker 3: Panamas beam, which is you know, really what what what

325
00:16:23,520 --> 00:16:26,280
Speaker 3: is the maximum allowed for going through the Panama Canal.

326
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Speaker 3: So there's only one size above, which is long Range two,

327
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Speaker 3: which is the largest ship that at.

328
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Speaker 2: The moment can't go through.

329
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Speaker 3: But I have been plans about expanding the Panama Canal

330
00:16:37,200 --> 00:16:39,400
Speaker 3: to take you know, broader ships as well, but at

331
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Speaker 3: the moment it's off to and including law ones that

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Speaker 3: primarily go through.

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Speaker 1: And can you educate our listeners how much can these

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00:16:46,960 --> 00:16:50,080
Speaker 1: ships hold in terms of you know, barrels or gallons

335
00:16:50,200 --> 00:16:52,760
Speaker 1: or tons in terms of you know, what can an

336
00:16:52,920 --> 00:16:55,600
Speaker 1: mr hold when you're talking about diesel gas.

337
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Speaker 3: Yeah, so if you if you, if you kind of

338
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Speaker 3: take it from from the bottom of would say, maybe

339
00:17:00,600 --> 00:17:04,200
Speaker 3: just as a channel overview of vessels, the way people

340
00:17:04,240 --> 00:17:07,320
Speaker 3: should think about it is that the smaller the vessels,

341
00:17:07,840 --> 00:17:11,160
Speaker 3: the more regional transportation it is. And as you move

342
00:17:11,160 --> 00:17:15,040
Speaker 3: off in size, the longer distances vessels are saying because

343
00:17:15,040 --> 00:17:18,320
Speaker 3: it gives better economy of scale by having more cargo

344
00:17:18,359 --> 00:17:21,840
Speaker 3: on board as long as you go longer distance. So

345
00:17:21,880 --> 00:17:24,720
Speaker 3: what we typically see is from the smaller ships, the

346
00:17:24,760 --> 00:17:28,320
Speaker 3: handy vessels, and then the medium range, which is you know,

347
00:17:28,600 --> 00:17:31,200
Speaker 3: will be loading anything around you know, forty thousand tons

348
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Speaker 3: of cargo.

349
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Speaker 2: You move off to the allow one vessels.

350
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Speaker 3: The long range ones would be like fifty five to

351
00:17:38,840 --> 00:17:41,520
Speaker 3: sixty five thousand tons of cargo, and then you move

352
00:17:41,560 --> 00:17:44,760
Speaker 3: off to the long range too, the largest productanger would

353
00:17:44,760 --> 00:17:47,800
Speaker 3: be around seventy five to eighty thousand tons of cargo.

354
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Speaker 2: Those are the.

355
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Speaker 3: Ranges, and as I said, the larger you get up,

356
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Speaker 3: the less trading you see and probably more structural transportation.

357
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Speaker 3: So for instance, long range two vessels are very often

358
00:17:59,280 --> 00:18:03,800
Speaker 3: used for structure transportation of NAFTA, which is a feedstock

359
00:18:03,840 --> 00:18:07,000
Speaker 3: that goes into the peto chemical industry and from that

360
00:18:07,080 --> 00:18:09,520
Speaker 3: produces you know, for instance, plastic and a lot of

361
00:18:09,520 --> 00:18:12,800
Speaker 3: plastic products that we end up using in our daily life.

362
00:18:13,040 --> 00:18:17,080
Speaker 1: Okay, so you know, more talking about ships, the IMO

363
00:18:17,240 --> 00:18:20,440
Speaker 1: has a bunch of emissions standards that they're trying to

364
00:18:20,480 --> 00:18:23,120
Speaker 1: get out, you know, they like to be a mission

365
00:18:23,160 --> 00:18:26,719
Speaker 1: free over time. Can you talk about you know what

366
00:18:26,760 --> 00:18:29,800
Speaker 1: your company is doing to try to meet those expectations

367
00:18:29,880 --> 00:18:32,560
Speaker 1: or the ships that you're ordering, you know they are

368
00:18:32,560 --> 00:18:38,000
Speaker 1: they do fuel. What's the strategy the HAFNA is taking

369
00:18:38,280 --> 00:18:40,800
Speaker 1: to get to you know, zero emissions eventually.

370
00:18:42,320 --> 00:18:45,320
Speaker 3: So first and foremost don focus has been on making

371
00:18:45,359 --> 00:18:47,680
Speaker 3: sure that we are in compliance with the current regulations

372
00:18:48,040 --> 00:18:52,040
Speaker 3: and the IMO's goal for twenty thirty. So that of

373
00:18:52,080 --> 00:18:54,439
Speaker 3: course is very much related to the feed we have today,

374
00:18:55,119 --> 00:18:58,720
Speaker 3: and we have, you know, like many others, introduced quite

375
00:18:58,760 --> 00:19:02,320
Speaker 3: a lot of of initiative that will reduce and has

376
00:19:02,359 --> 00:19:04,520
Speaker 3: reduced our emissions overall.

377
00:19:05,000 --> 00:19:06,840
Speaker 2: And I can say at the moment, when you.

378
00:19:06,800 --> 00:19:11,959
Speaker 3: Look at the trajectory from today up until twenty thirty,

379
00:19:12,040 --> 00:19:15,240
Speaker 3: it looks like HAFNE will be in compliance with the

380
00:19:15,280 --> 00:19:18,159
Speaker 3: twenty thirty regulation targets that we need to meet that

381
00:19:18,200 --> 00:19:21,200
Speaker 3: we will already meet them in twenty twenty eight. So

382
00:19:21,359 --> 00:19:22,840
Speaker 3: a lot of that, of course is related to the

383
00:19:22,840 --> 00:19:25,280
Speaker 3: fact that we have a modern fleet and we have

384
00:19:25,400 --> 00:19:27,320
Speaker 3: invested in a lot of initiative as I said, that

385
00:19:27,400 --> 00:19:33,080
Speaker 3: reduces consumption with fuel and emissions overall when it comes

386
00:19:33,720 --> 00:19:36,840
Speaker 3: two new builds, so the only new builds that we

387
00:19:37,520 --> 00:19:39,280
Speaker 3: have on order and have ordered over.

388
00:19:39,119 --> 00:19:40,200
Speaker 2: The last few years.

389
00:19:40,600 --> 00:19:44,679
Speaker 3: They're all dual fuel and they are either dual fuel

390
00:19:45,119 --> 00:19:48,119
Speaker 3: between fuel and LNG or they are dual fuel between

391
00:19:48,160 --> 00:19:51,480
Speaker 3: fuel and methanol. But these vessels were contracted against long

392
00:19:51,560 --> 00:19:55,800
Speaker 3: term contracts, so we have not ordered any new belts

393
00:19:56,040 --> 00:19:58,840
Speaker 3: on pure speculation. I hoping that we are right in

394
00:19:58,920 --> 00:20:02,919
Speaker 3: how we see the future fuel becoming available. We have

395
00:20:03,000 --> 00:20:07,399
Speaker 3: contracted vessels against customers requirement for five to seven years

396
00:20:07,640 --> 00:20:12,120
Speaker 3: leasing contracts, so that means again we have an investment,

397
00:20:12,119 --> 00:20:15,040
Speaker 3: but the investment is covered by guaranteed earnings, which is

398
00:20:15,080 --> 00:20:16,320
Speaker 3: an important part for us.

399
00:20:16,560 --> 00:20:19,920
Speaker 1: So if you're a betting man, what do you think

400
00:20:20,040 --> 00:20:24,760
Speaker 1: the alternative fuel that's gonna win in global shipping? Is

401
00:20:24,760 --> 00:20:27,280
Speaker 1: it methanol or is it LNG? How do you see

402
00:20:27,280 --> 00:20:27,920
Speaker 1: that transition?

403
00:20:29,440 --> 00:20:32,480
Speaker 3: So yeah, So I mean personally, I think probably people

404
00:20:32,520 --> 00:20:34,320
Speaker 3: have been a bit too optimistic about some of the

405
00:20:34,400 --> 00:20:37,800
Speaker 3: very new fuels being available too soon. So I'll view

406
00:20:37,960 --> 00:20:40,400
Speaker 3: is that L and T will definitely be a bridge

407
00:20:41,160 --> 00:20:44,760
Speaker 3: to our targets in twenty fifty. In general, as a fuel,

408
00:20:46,520 --> 00:20:49,040
Speaker 3: we think that methanol will definitely be one as well,

409
00:20:49,119 --> 00:20:51,240
Speaker 3: particularly because methanol.

410
00:20:50,880 --> 00:20:53,280
Speaker 2: Is well known. It's a well known product out there.

411
00:20:53,320 --> 00:20:55,920
Speaker 3: You know it's tested, it can be used today, and

412
00:20:56,760 --> 00:20:58,960
Speaker 3: you know it has actually a good value as an

413
00:20:59,000 --> 00:21:01,280
Speaker 3: alternative compared to regular fuel.

414
00:21:02,359 --> 00:21:04,640
Speaker 2: Then comes the new ones, and we.

415
00:21:04,600 --> 00:21:07,479
Speaker 3: Are sure some of them will be certainly part of

416
00:21:07,480 --> 00:21:09,440
Speaker 3: that solution as well. We think ammonia will be part

417
00:21:09,440 --> 00:21:11,639
Speaker 3: of the solution for sure. There's a lot of issues

418
00:21:11,640 --> 00:21:13,639
Speaker 3: with ammonia that is being tested at the moment, but

419
00:21:13,720 --> 00:21:16,600
Speaker 3: we are quite convinced that ammonia will be one as well.

420
00:21:17,600 --> 00:21:20,240
Speaker 2: But we don't think there'll be one winner, and we think.

421
00:21:20,160 --> 00:21:23,560
Speaker 3: That the right way to do this is to take

422
00:21:23,640 --> 00:21:27,119
Speaker 3: things in steps as well, take what's available that in

423
00:21:27,160 --> 00:21:29,119
Speaker 3: a way moves you in a better position tomorre than

424
00:21:29,119 --> 00:21:31,879
Speaker 3: you were today. I think the danger has been that

425
00:21:31,920 --> 00:21:33,840
Speaker 3: there have been too many people focusing on going from

426
00:21:33,880 --> 00:21:36,240
Speaker 3: where we are today to zero, and I think that's

427
00:21:36,240 --> 00:21:37,919
Speaker 3: the wrong approach to it. I think we should be

428
00:21:37,960 --> 00:21:40,399
Speaker 3: happy if we can go from today and cut fifty

429
00:21:40,400 --> 00:21:42,960
Speaker 3: percent off on the way, and then another twenty five,

430
00:21:43,000 --> 00:21:46,160
Speaker 3: and then not a twenty five. So we think there'll

431
00:21:46,160 --> 00:21:48,720
Speaker 3: be many winners. That's the short answer to it.

432
00:21:48,880 --> 00:21:52,960
Speaker 1: How does your company make those incremental improvements on ships

433
00:21:53,000 --> 00:21:55,080
Speaker 1: that you currently have like what are you doing to

434
00:21:55,119 --> 00:21:58,000
Speaker 1: those ships or you're retrofitting them. You know, I've heard

435
00:21:58,040 --> 00:22:00,600
Speaker 1: that you can paint them with special pain you know,

436
00:22:00,720 --> 00:22:05,119
Speaker 1: makes the more it provides less drags. So what is

437
00:22:05,760 --> 00:22:09,960
Speaker 1: Happnea doing to to make those incremental changes.

438
00:22:10,320 --> 00:22:12,199
Speaker 2: So there's probably two ways to look at this.

439
00:22:12,320 --> 00:22:15,280
Speaker 3: There is the operational way, which basically is how do

440
00:22:15,320 --> 00:22:18,480
Speaker 3: you actually how do you conduct the daily operation of

441
00:22:18,520 --> 00:22:20,359
Speaker 3: the ship. So it's a little bit like you're driving

442
00:22:20,400 --> 00:22:23,880
Speaker 3: a car. There's no need to go fast unless there

443
00:22:23,920 --> 00:22:25,920
Speaker 3: is a particular thing you have to reach. Going fast

444
00:22:25,960 --> 00:22:28,879
Speaker 3: because you burn more oil and put out more emissions.

445
00:22:29,240 --> 00:22:31,560
Speaker 3: So timing the way you sail the ship every day,

446
00:22:31,640 --> 00:22:35,400
Speaker 3: making sure you're not unnecessarily spending and burning more few

447
00:22:35,440 --> 00:22:38,560
Speaker 3: than necessary is an operational thing. And for that we

448
00:22:38,720 --> 00:22:42,520
Speaker 3: have quite a few digital infrastructure solutions that helps us

449
00:22:42,560 --> 00:22:47,200
Speaker 3: monitor that. We monitor you know, the waves, the weather conditions,

450
00:22:47,280 --> 00:22:50,960
Speaker 3: how to navigate in that. So all of that is

451
00:22:51,000 --> 00:22:54,280
Speaker 3: part of I would say, a complicated algorithm.

452
00:22:53,720 --> 00:22:56,359
Speaker 2: That helps you in daily operation of the vessel. So

453
00:22:56,400 --> 00:22:57,400
Speaker 2: that's one part of it.

454
00:22:58,119 --> 00:23:01,480
Speaker 3: Then the technical part is around exactly what you mentioned,

455
00:23:02,240 --> 00:23:05,880
Speaker 3: A big, big thing about your performance and how much

456
00:23:05,920 --> 00:23:07,320
Speaker 3: oil you've burned et cetera.

457
00:23:08,080 --> 00:23:10,639
Speaker 2: Is how the ship goes and flows through the water.

458
00:23:11,480 --> 00:23:15,840
Speaker 3: So having a proper treated and painted ship side instead

459
00:23:15,840 --> 00:23:18,840
Speaker 3: of something which has been you know, populated by various

460
00:23:18,880 --> 00:23:22,280
Speaker 3: growth things, et cetera that prevents you from going with

461
00:23:22,440 --> 00:23:26,639
Speaker 3: the optimal efficiency is another area. So you clean your

462
00:23:26,680 --> 00:23:30,200
Speaker 3: hull sides more, you paint them better, You increase the

463
00:23:30,240 --> 00:23:32,680
Speaker 3: intervals between the time you clean them to make sure

464
00:23:32,680 --> 00:23:35,160
Speaker 3: that they always you know, in a good condition. When

465
00:23:35,160 --> 00:23:37,960
Speaker 3: it comes to when it comes to not having growth

466
00:23:38,040 --> 00:23:41,200
Speaker 3: on the sides of the ship, it's about improving the

467
00:23:41,240 --> 00:23:44,879
Speaker 3: flow of water into the propellers, for instance. So instead

468
00:23:44,880 --> 00:23:47,040
Speaker 3: of having a classic design where you just are in

469
00:23:47,119 --> 00:23:51,080
Speaker 3: the water and basically water flows into the propeller, then

470
00:23:51,359 --> 00:23:53,440
Speaker 3: you have something called the Muris doc that you can

471
00:23:53,440 --> 00:23:58,320
Speaker 3: install which basically ensures that the water more efficiently.

472
00:23:58,000 --> 00:23:59,080
Speaker 2: Goes into the propeller.

473
00:23:59,240 --> 00:24:01,399
Speaker 3: So therefore you use the energy and produce energy in

474
00:24:01,400 --> 00:24:02,240
Speaker 3: a more efficient way.

475
00:24:02,400 --> 00:24:03,520
Speaker 2: To give you two examples.

476
00:24:04,320 --> 00:24:08,280
Speaker 1: Oh okay, very interesting. Keeping on, you know, vessels, could

477
00:24:08,280 --> 00:24:11,320
Speaker 1: you talk about what the costs of a vessel is

478
00:24:11,359 --> 00:24:14,520
Speaker 1: today and how has that changed over the years, and

479
00:24:15,080 --> 00:24:17,440
Speaker 1: kind of what the secondary market looks like and how

480
00:24:17,520 --> 00:24:21,760
Speaker 1: active is happ near in the secondary market in terms

481
00:24:21,800 --> 00:24:23,560
Speaker 1: of buying and selling ships.

482
00:24:24,520 --> 00:24:26,359
Speaker 3: So there's no doubt that you are the moment at

483
00:24:26,400 --> 00:24:29,760
Speaker 3: a historically high when it comes to new built prices

484
00:24:30,160 --> 00:24:33,840
Speaker 3: and secondhand prices. And that's all obviously reflecting that we're

485
00:24:34,000 --> 00:24:36,159
Speaker 3: a in a super strong freight market, so earnings are

486
00:24:36,200 --> 00:24:39,399
Speaker 3: high as well. So if you take let's say the

487
00:24:39,480 --> 00:24:42,800
Speaker 3: medium range productanker to start there, if you want to

488
00:24:42,840 --> 00:24:48,000
Speaker 3: have to buy a new ship of a medium rain size, well,

489
00:24:48,000 --> 00:24:49,680
Speaker 3: first and foremost you will only be getting it in

490
00:24:49,760 --> 00:24:52,720
Speaker 3: late twenty seven, early twenty eight, so it's really far out,

491
00:24:53,359 --> 00:24:56,399
Speaker 3: and you'll probably be paying around fifty to fifty one million.

492
00:24:56,200 --> 00:24:59,879
Speaker 2: Dollars for that ship. Now, if you go.

493
00:24:59,760 --> 00:25:02,159
Speaker 3: Back and look at what was the what was the

494
00:25:02,280 --> 00:25:05,240
Speaker 3: normal price going back a few years for a medium

495
00:25:05,320 --> 00:25:08,400
Speaker 3: rang for the tanker for a new build, you will

496
00:25:08,440 --> 00:25:11,199
Speaker 3: probably be paying between thirty and thirty three million dollars

497
00:25:11,280 --> 00:25:13,160
Speaker 3: just to give you a flavor of how big the.

498
00:25:13,160 --> 00:25:13,880
Speaker 2: Increase has been.

499
00:25:14,480 --> 00:25:14,760
Speaker 1: Wow.

500
00:25:16,040 --> 00:25:18,439
Speaker 2: And the same relates to the secondhand ships.

501
00:25:18,440 --> 00:25:20,480
Speaker 3: I mean, the secondhand ships in some form and shape

502
00:25:20,840 --> 00:25:23,720
Speaker 3: are slightly more expensive because if you buy a secondhand vessel,

503
00:25:23,720 --> 00:25:26,679
Speaker 3: you get it today, which means it delivers.

504
00:25:26,400 --> 00:25:28,920
Speaker 2: Right in the middle of a high earning environment.

505
00:25:29,320 --> 00:25:31,040
Speaker 3: The problem with the new build you pay a very

506
00:25:31,119 --> 00:25:33,560
Speaker 3: high price, but you only get it three or four

507
00:25:33,640 --> 00:25:35,639
Speaker 3: years out, so you don't really know how strong the

508
00:25:35,680 --> 00:25:37,720
Speaker 3: earnings will be once to ship delivers.

509
00:25:39,119 --> 00:25:42,280
Speaker 1: And how active is happening in that market and buying

510
00:25:42,280 --> 00:25:43,560
Speaker 1: and selling use ships.

511
00:25:43,880 --> 00:25:46,280
Speaker 3: So we you know, we did quite a lot of

512
00:25:46,280 --> 00:25:49,520
Speaker 3: transactions back in twenty one, late twenty one, early twenty

513
00:25:49,600 --> 00:25:52,359
Speaker 3: two before the market came, and that was kind of

514
00:25:52,520 --> 00:25:54,560
Speaker 3: the bottom of the cycle. I mean, we bought above

515
00:25:54,760 --> 00:25:58,520
Speaker 3: forty vessels in that period, so that has positioned us

516
00:25:58,600 --> 00:26:02,560
Speaker 3: quite well for this strong market. So in the current market,

517
00:26:02,640 --> 00:26:06,359
Speaker 3: we are not buyers on a speculative basis. We're basically

518
00:26:06,920 --> 00:26:09,200
Speaker 3: focusing on selling some of the old assets that we

519
00:26:09,400 --> 00:26:12,719
Speaker 3: don't feel is belongs to our strategy going forward, and

520
00:26:12,760 --> 00:26:16,760
Speaker 3: we're taking advantage of very high prices for these old assets.

521
00:26:17,320 --> 00:26:19,159
Speaker 3: And then we are doing these few new builds but

522
00:26:19,280 --> 00:26:22,119
Speaker 3: only against guaranteed earning. So you can say at the

523
00:26:22,160 --> 00:26:25,560
Speaker 3: moment of focus is really on harvesting on what we

524
00:26:25,640 --> 00:26:28,520
Speaker 3: have built when years were bad, where we built the fleet,

525
00:26:29,040 --> 00:26:32,040
Speaker 3: and then returning capital to shareholders. Rather than going out

526
00:26:32,080 --> 00:26:34,159
Speaker 3: and spending money when we think we are at a

527
00:26:34,280 --> 00:26:35,439
Speaker 3: very high point of the cycle.

528
00:26:36,119 --> 00:26:38,520
Speaker 1: All right, Well, that that's that's a that's a great

529
00:26:38,600 --> 00:26:42,920
Speaker 1: way to segue. You know, you mentioned returning capitalist shareholders.

530
00:26:43,800 --> 00:26:45,960
Speaker 1: You know you are a public company, So what are

531
00:26:46,000 --> 00:26:49,840
Speaker 1: the priorities for happnia are you you know, do you

532
00:26:49,840 --> 00:26:53,439
Speaker 1: guys do special dividends when earnings are really good? Are

533
00:26:53,480 --> 00:26:55,480
Speaker 1: you more into buybacks? What do you what are you

534
00:26:55,520 --> 00:26:57,560
Speaker 1: doing with all this extra cash that you're generating?

535
00:26:57,560 --> 00:27:00,280
Speaker 3: Now, Yes, it's obviously a nice locktury problem to have,

536
00:27:00,560 --> 00:27:03,200
Speaker 3: and so we have been focusing so far on paying

537
00:27:03,240 --> 00:27:07,280
Speaker 3: out dividends. That doesn't mean that we're ruling our share buybacks,

538
00:27:07,320 --> 00:27:09,520
Speaker 3: but you know, we have felt so far that dividend

539
00:27:09,560 --> 00:27:12,000
Speaker 3: was the right way for us. If our shares were

540
00:27:12,000 --> 00:27:15,560
Speaker 3: trading world below the net asset value, we would definitely

541
00:27:15,600 --> 00:27:18,720
Speaker 3: consider to change that policy to buy back shares. But

542
00:27:18,800 --> 00:27:21,240
Speaker 3: at the moment, as we're also trading around our net

543
00:27:21,240 --> 00:27:25,040
Speaker 3: asset value, were paying our dividends. So we basically pay

544
00:27:25,040 --> 00:27:29,359
Speaker 3: out at the moment eighty percent of our annualized net profit.

545
00:27:30,320 --> 00:27:35,280
Speaker 3: We pay on a quarterly basis towards shareholders. We have

546
00:27:35,440 --> 00:27:39,840
Speaker 3: linked the dividend policy to our net loans to value. So,

547
00:27:39,880 --> 00:27:42,760
Speaker 3: in other words, how do we stand in terms of

548
00:27:42,800 --> 00:27:46,720
Speaker 3: our debt outstanding versus the value of our assets?

549
00:27:47,240 --> 00:27:51,200
Speaker 2: So we're basically said, the more we reduce our our.

550
00:27:52,600 --> 00:27:55,480
Speaker 3: Our debt our net loans to value, the higher we

551
00:27:55,520 --> 00:27:57,960
Speaker 3: will go up on dividends. We're basically matching those two

552
00:27:58,040 --> 00:28:00,600
Speaker 3: saying that the lesson that we have, the more we

553
00:28:00,600 --> 00:28:01,720
Speaker 3: can pay out in dividends.

554
00:28:01,720 --> 00:28:03,760
Speaker 2: That's how we've chosen to connect the two.

555
00:28:04,400 --> 00:28:07,720
Speaker 1: Okay, And you know, I'm curious. So when you do

556
00:28:07,960 --> 00:28:13,159
Speaker 1: buy a ship, a news ship, and you know what,

557
00:28:13,160 --> 00:28:15,240
Speaker 1: what does that look like from a financial standpoint? Do

558
00:28:15,280 --> 00:28:17,480
Speaker 1: you guys put like ten percent down? Are you putting

559
00:28:17,520 --> 00:28:21,760
Speaker 1: twenty percent down? You're paying in cash? But how does

560
00:28:21,800 --> 00:28:23,520
Speaker 1: that work when you're buying because you know, we're talking

561
00:28:23,520 --> 00:28:25,960
Speaker 1: about a fifty one million dollar asset, so it's there's

562
00:28:26,000 --> 00:28:29,800
Speaker 1: a I'm assuming you have to look past what's in

563
00:28:29,440 --> 00:28:32,439
Speaker 1: the couch cushions in terms of change. So how do

564
00:28:32,480 --> 00:28:33,520
Speaker 1: you finance these things?

565
00:28:34,000 --> 00:28:36,679
Speaker 2: Yeah, that's right. No, it's a very capital intense business.

566
00:28:36,720 --> 00:28:40,400
Speaker 3: Right, So I would say on a typical basis, and

567
00:28:41,440 --> 00:28:43,840
Speaker 3: you know, let's let's relate this to what I call

568
00:28:43,880 --> 00:28:47,560
Speaker 3: a mid cycle market, we would most likely go out.

569
00:28:47,600 --> 00:28:49,920
Speaker 3: If we bought a ship, we would probably take a

570
00:28:50,000 --> 00:28:51,920
Speaker 3: loan of sixty percent and we will put in forty

571
00:28:51,960 --> 00:28:54,640
Speaker 3: percent inequity. That will be a classic scenario for us

572
00:28:54,640 --> 00:28:56,920
Speaker 3: in a mid cycle environment. I think where we are now,

573
00:28:56,960 --> 00:28:59,000
Speaker 3: when prices are very very high, if we were to

574
00:28:59,040 --> 00:29:01,360
Speaker 3: go out and buy a ship, we would definitely take

575
00:29:01,480 --> 00:29:04,160
Speaker 3: less debt and more equity. And that we would do

576
00:29:04,240 --> 00:29:08,040
Speaker 3: under the assumption that it's a cyclical business and once

577
00:29:08,120 --> 00:29:10,080
Speaker 3: value starts to drop, you want to make sure that

578
00:29:10,160 --> 00:29:13,800
Speaker 3: you have a cushion before you reach any kind of

579
00:29:14,280 --> 00:29:16,840
Speaker 3: thresholds versus your debt and the value of the assets.

580
00:29:17,480 --> 00:29:22,200
Speaker 3: But I think in a normalized market, debt forty percent equity, and.

581
00:29:22,160 --> 00:29:24,600
Speaker 1: When you're taking debt, you're taking you're working with banks

582
00:29:24,600 --> 00:29:27,240
Speaker 1: and going into the public and private markets, or you're

583
00:29:27,280 --> 00:29:29,120
Speaker 1: just borrowing directly from the banks.

584
00:29:29,840 --> 00:29:30,040
Speaker 2: Yeah.

585
00:29:30,080 --> 00:29:32,360
Speaker 3: So we are fortunate to have a you know, a

586
00:29:32,360 --> 00:29:36,080
Speaker 3: big banking group of counting almost thirty banks. So you

587
00:29:36,120 --> 00:29:37,680
Speaker 3: know what we would do is typically we would have

588
00:29:37,720 --> 00:29:41,120
Speaker 3: a classic bank debt with security in you know, the

589
00:29:41,200 --> 00:29:43,640
Speaker 3: vessel in general, and that will then allow you to

590
00:29:43,680 --> 00:29:46,600
Speaker 3: take out a loan basically not very different from the

591
00:29:46,640 --> 00:29:48,440
Speaker 3: mortgage people would take out in the houses.

592
00:29:48,680 --> 00:29:52,480
Speaker 2: It works basically the same way, so that would typically

593
00:29:52,520 --> 00:29:53,440
Speaker 2: be the way we would do it.

594
00:29:54,600 --> 00:29:57,480
Speaker 1: So, if you're looking into your crystal ball and looking

595
00:29:57,480 --> 00:30:00,400
Speaker 1: out into the future in twenty twenty five, you know,

596
00:30:00,640 --> 00:30:02,760
Speaker 1: how do you think the product tanker market's going to

597
00:30:02,760 --> 00:30:05,720
Speaker 1: be relative to where we are today? Because because there's

598
00:30:05,720 --> 00:30:08,160
Speaker 1: a lot of uncertainties, and I know it's it's probably

599
00:30:08,280 --> 00:30:11,800
Speaker 1: next impossible to predict, but you know, how are you

600
00:30:11,840 --> 00:30:13,800
Speaker 1: feeling going into next year?

601
00:30:15,800 --> 00:30:18,680
Speaker 3: No, I think we're entering a multi year of a

602
00:30:18,760 --> 00:30:21,240
Speaker 3: very very strong cycle for product tankers, and the main

603
00:30:21,280 --> 00:30:22,840
Speaker 3: reason is, as I said earlier, is there will be

604
00:30:22,880 --> 00:30:26,680
Speaker 3: too few ships to satisfy the demand for oil transportation.

605
00:30:26,760 --> 00:30:31,760
Speaker 3: In general, the world is underestimated the need for oil

606
00:30:31,800 --> 00:30:36,680
Speaker 3: going forward, and at the moment, most people are estimating

607
00:30:36,680 --> 00:30:39,080
Speaker 3: that all demand will continue to go up until twenty thirty,

608
00:30:40,160 --> 00:30:42,200
Speaker 3: and so that in itself is a positive thing.

609
00:30:43,520 --> 00:30:45,320
Speaker 2: What you should bear.

610
00:30:45,320 --> 00:30:47,959
Speaker 3: In mind when you talk about product tankers and transportation

611
00:30:48,000 --> 00:30:51,960
Speaker 3: of refined oil products is that any geo political event

612
00:30:52,640 --> 00:30:55,440
Speaker 3: almost always have a positive effect on the freight markets

613
00:30:55,480 --> 00:30:59,120
Speaker 3: of product tankers and the reason for that being is

614
00:30:59,160 --> 00:31:02,120
Speaker 3: we are kind of transfer affording the finalized product that

615
00:31:02,160 --> 00:31:05,320
Speaker 3: goes to the consumer. So we're like, you know, we're

616
00:31:05,320 --> 00:31:07,520
Speaker 3: like almost like the department store, you know, the sell

617
00:31:07,640 --> 00:31:10,520
Speaker 3: stuff when you know, when when people panic a little bit.

618
00:31:10,600 --> 00:31:12,200
Speaker 2: So what typically happens is if.

619
00:31:12,120 --> 00:31:17,560
Speaker 3: There's any element of concern, people will rush to buy gasoline, diesel,

620
00:31:17,720 --> 00:31:21,240
Speaker 3: gasol and fill up their inventory. So quite often these

621
00:31:21,280 --> 00:31:26,680
Speaker 3: globolitical events create inefficiency in transportation, and because of that inefficiency,

622
00:31:26,680 --> 00:31:29,600
Speaker 3: freight rates will go up in sectors like ours.

623
00:31:29,640 --> 00:31:31,960
Speaker 1: Right, changing gears just a little bit, you know, part

624
00:31:31,960 --> 00:31:33,520
Speaker 1: of your intro, you know, it says you're the co

625
00:31:33,720 --> 00:31:36,000
Speaker 1: chair of the all Aboard Alliance. Could you talk a

626
00:31:36,040 --> 00:31:39,360
Speaker 1: little bit about, you know, what the Oliboard Alliance does

627
00:31:39,640 --> 00:31:40,920
Speaker 1: and the work that you do there.

628
00:31:42,560 --> 00:31:45,440
Speaker 3: Absolutely, so, yeah, I'm a very you know, I'm a

629
00:31:45,480 --> 00:31:48,480
Speaker 3: proud CoA chair of the al Aboard Alliance, which basically

630
00:31:48,520 --> 00:31:51,760
Speaker 3: is an alliance that was formed under the Global Maritime Forum,

631
00:31:52,120 --> 00:31:56,720
Speaker 3: which again is a global international organization that really consists

632
00:31:56,720 --> 00:32:00,160
Speaker 3: of a lot of stakeholders in the transportation industry that

633
00:32:00,240 --> 00:32:03,840
Speaker 3: has an interesting meeting up and discussing and create initiative

634
00:32:03,920 --> 00:32:07,240
Speaker 3: that will help the industry overall move forward on various

635
00:32:07,240 --> 00:32:11,920
Speaker 3: different things. So lots of initiatives on the decompanization, you know,

636
00:32:11,960 --> 00:32:16,360
Speaker 3: getting to zero emissions, et cetera. So this is really

637
00:32:16,400 --> 00:32:23,440
Speaker 3: a forum of all stakeholders including politicians, banks, finances, ship owners, shipyards,

638
00:32:23,440 --> 00:32:26,160
Speaker 3: et cetera. So it makes it very powerful from an

639
00:32:26,160 --> 00:32:30,800
Speaker 3: inditry perspective. So we identify challenges and problems that the

640
00:32:30,840 --> 00:32:34,080
Speaker 3: industry as a whole wants to address, and we try

641
00:32:34,080 --> 00:32:37,720
Speaker 3: to come with input to the legislators in what the

642
00:32:37,720 --> 00:32:41,040
Speaker 3: industry feels we should do about certain things. So one

643
00:32:41,080 --> 00:32:45,320
Speaker 3: of them is the whole discussion about about diversity, equity

644
00:32:45,360 --> 00:32:49,960
Speaker 3: and inclusion, which a lot of us feel has been

645
00:32:51,320 --> 00:32:53,840
Speaker 3: an overlooked area in certain ways within our industry, and

646
00:32:53,880 --> 00:32:54,880
Speaker 3: we felt there were a lot.

647
00:32:54,760 --> 00:32:58,720
Speaker 2: Of areas, particularly at sea, where we could do better.

648
00:32:58,840 --> 00:33:04,840
Speaker 3: In order to act and improve the working conditions of

649
00:33:04,920 --> 00:33:06,479
Speaker 3: all the people that we would like to hire and

650
00:33:06,520 --> 00:33:11,320
Speaker 3: have on board. So you can say for the focus

651
00:33:11,360 --> 00:33:14,160
Speaker 3: areas here is really it makes no sense if you

652
00:33:14,200 --> 00:33:17,280
Speaker 3: ask me to have a business and be in an

653
00:33:17,280 --> 00:33:21,000
Speaker 3: industry where you don't have the maximum access to all

654
00:33:21,040 --> 00:33:22,280
Speaker 3: the talents that are out there.

655
00:33:22,800 --> 00:33:24,120
Speaker 2: So I think the business.

656
00:33:23,800 --> 00:33:26,440
Speaker 3: Rushing now behind the all the boarder lines and diversity

657
00:33:26,560 --> 00:33:29,720
Speaker 3: its inclusion is that we knew effectively a lot of

658
00:33:29,720 --> 00:33:34,000
Speaker 3: people were choosing not to join shipping, either on the

659
00:33:34,080 --> 00:33:37,720
Speaker 3: ships or at shaw because they didn't feel it was

660
00:33:37,720 --> 00:33:39,880
Speaker 3: to finde environment for them, and they didn't feel that

661
00:33:39,920 --> 00:33:41,800
Speaker 3: it was an environment that maybe.

662
00:33:41,440 --> 00:33:47,760
Speaker 2: Was sufficiently inclusive for certain groups of people. And that's

663
00:33:47,760 --> 00:33:49,880
Speaker 2: what we're trying to focus on.

664
00:33:49,960 --> 00:33:54,160
Speaker 3: So we're basically running a workstream that focuses on diversity

665
00:33:54,200 --> 00:33:57,280
Speaker 3: at sea, which at the moment is focusing a lot

666
00:33:57,320 --> 00:33:59,880
Speaker 3: on the gender diversity, but ultimately will focus on any

667
00:34:00,200 --> 00:34:04,040
Speaker 3: visits I see creating hopefully a working environment where everyone

668
00:34:04,080 --> 00:34:07,120
Speaker 3: can feel safe and inclusive, and therefore we hope we

669
00:34:07,120 --> 00:34:10,240
Speaker 3: will be able to recruit from a lot bigger talent

670
00:34:10,320 --> 00:34:12,080
Speaker 3: pool than we had before.

671
00:34:12,480 --> 00:34:16,920
Speaker 1: All right, great, and they're just finally on HALFNEYA. Do

672
00:34:17,600 --> 00:34:20,920
Speaker 1: you as an organization have any long term targets or

673
00:34:20,920 --> 00:34:23,760
Speaker 1: ambitions that you have out there that you'd like to share.

674
00:34:24,640 --> 00:34:27,879
Speaker 3: Well, everything we do is really based on the long term, right,

675
00:34:28,000 --> 00:34:30,880
Speaker 3: So for halfne it's not about trying to maximize on

676
00:34:30,960 --> 00:34:33,560
Speaker 3: the current strong freight market and then just right away

677
00:34:33,560 --> 00:34:36,479
Speaker 3: in the sunset and you'll be happy about it. So yes,

678
00:34:36,560 --> 00:34:39,960
Speaker 3: our strategy is that everything we do is based on

679
00:34:40,000 --> 00:34:42,960
Speaker 3: the long term. So that means we in addition to

680
00:34:43,000 --> 00:34:46,440
Speaker 3: our current business which is to transport refine oil products,

681
00:34:47,040 --> 00:34:51,160
Speaker 3: we have a very strong focus on as the world

682
00:34:51,400 --> 00:34:56,360
Speaker 3: slowly but surely will move away from fossil fuels, what

683
00:34:56,480 --> 00:34:59,240
Speaker 3: will our role in Halfney be in the transportation market

684
00:34:59,280 --> 00:35:03,439
Speaker 3: going forward. So we are now actively involved in UH

685
00:35:03,880 --> 00:35:09,000
Speaker 3: in the production and subsequently transportation of ammonia from the

686
00:35:09,080 --> 00:35:13,319
Speaker 3: US golf, methanol from the US golf and also CO two.

687
00:35:14,080 --> 00:35:16,680
Speaker 3: So we are we are now focusing on how we

688
00:35:17,200 --> 00:35:19,640
Speaker 3: was surely built, if you like, a path to a

689
00:35:19,680 --> 00:35:22,279
Speaker 3: world that would be consisting of more renewable fuels, and

690
00:35:22,320 --> 00:35:24,800
Speaker 3: what our role will be there as a transportation company,

691
00:35:25,880 --> 00:35:26,279
Speaker 3: all right, and.

692
00:35:26,600 --> 00:35:30,200
Speaker 1: As as a as a leader of a global transportation company.

693
00:35:30,480 --> 00:35:31,920
Speaker 1: You know, is there anything that keeps you up at

694
00:35:32,000 --> 00:35:34,920
Speaker 1: night in your role at Ana.

695
00:35:35,040 --> 00:35:37,360
Speaker 2: No, I wouldn't say that. I think that what concerns

696
00:35:37,400 --> 00:35:41,960
Speaker 2: me at the moment overall is not you know, our

697
00:35:41,960 --> 00:35:42,880
Speaker 2: transportation sector.

698
00:35:42,920 --> 00:35:45,239
Speaker 3: I think all the fundamentals that we have is in

699
00:35:45,280 --> 00:35:48,280
Speaker 3: for a very strong market. My concern is really really

700
00:35:48,280 --> 00:35:49,840
Speaker 3: all about the gel political.

701
00:35:49,480 --> 00:35:49,960
Speaker 2: Side, you know.

702
00:35:50,080 --> 00:35:52,720
Speaker 3: I mean my concern is more about if the world

703
00:35:52,719 --> 00:35:56,120
Speaker 3: continues to be unstable, you know, if more sanctions will

704
00:35:56,120 --> 00:35:59,799
Speaker 3: come in play. Ultimately, what concerns me is that if

705
00:35:59,840 --> 00:36:05,319
Speaker 3: the world trade gets damaged or reduced by a geo

706
00:36:05,360 --> 00:36:09,240
Speaker 3: political fight that includes sanctions and prevents cargoes from flow

707
00:36:09,360 --> 00:36:10,239
Speaker 3: and trade.

708
00:36:10,120 --> 00:36:12,319
Speaker 2: On a global basis, because that's what we live from.

709
00:36:12,320 --> 00:36:15,560
Speaker 3: We live from free trade, global trade and the ability

710
00:36:15,600 --> 00:36:19,080
Speaker 3: to optimize around the whole globe and not just certain areas.

711
00:36:19,120 --> 00:36:22,320
Speaker 1: Gotcha. And then you know, I'm just curious. So you've

712
00:36:22,360 --> 00:36:24,920
Speaker 1: been in shipping from what I understand your whole career.

713
00:36:25,120 --> 00:36:27,800
Speaker 1: How did you initially get into the marine shipping industry?

714
00:36:28,360 --> 00:36:30,600
Speaker 3: Well, I was, like many others, you know, probably a

715
00:36:30,680 --> 00:36:33,680
Speaker 3: confused young man, at least so confused that my mother

716
00:36:33,800 --> 00:36:36,800
Speaker 3: was concerned, you know, what was going to happen to

717
00:36:36,880 --> 00:36:38,480
Speaker 3: us on So one day she just put like a

718
00:36:38,520 --> 00:36:42,880
Speaker 3: small clip from a from a from a paper that

719
00:36:43,000 --> 00:36:46,200
Speaker 3: described shipping in a very short way and it said,

720
00:36:46,239 --> 00:36:48,800
Speaker 3: you know, if you're interested in global trade, you like

721
00:36:49,160 --> 00:36:52,799
Speaker 3: the challenge of your speaking foreign languages and economics, etc.

722
00:36:53,120 --> 00:36:54,120
Speaker 2: You should look into shipping.

723
00:36:54,120 --> 00:36:56,839
Speaker 3: And she said this greatly isn't that what you say

724
00:36:56,840 --> 00:37:00,640
Speaker 3: you always have an interest in And I then applied

725
00:37:01,200 --> 00:37:03,320
Speaker 3: to every company I could find on the Yellow Pages

726
00:37:03,360 --> 00:37:07,400
Speaker 3: that was involved in transportation, and yeah, ended up in

727
00:37:07,520 --> 00:37:10,000
Speaker 3: torm as a trainee and from then just kind of

728
00:37:10,040 --> 00:37:10,560
Speaker 3: move forward.

729
00:37:10,600 --> 00:37:13,600
Speaker 2: So you know, she was right. It fitted me very well.

730
00:37:13,640 --> 00:37:16,200
Speaker 3: And I can say, you know, hand on hard that

731
00:37:16,360 --> 00:37:19,120
Speaker 3: I've never regretted one second that I went into the industry.

732
00:37:19,120 --> 00:37:20,200
Speaker 2: It's super interesting.

733
00:37:20,920 --> 00:37:23,319
Speaker 1: And when your your career in shipping has always been

734
00:37:23,360 --> 00:37:26,640
Speaker 1: on shore, have you ever been been on this on

735
00:37:26,680 --> 00:37:29,280
Speaker 1: the ships from the operations standpoint.

736
00:37:28,960 --> 00:37:30,680
Speaker 3: Not as a permanent basis, but you know, I've been

737
00:37:30,680 --> 00:37:32,960
Speaker 3: traveling around with our ships in the early days and

738
00:37:33,000 --> 00:37:35,759
Speaker 3: you know, been doing you know, a few weeks on

739
00:37:35,880 --> 00:37:38,759
Speaker 3: containers if in West Africa, but I haven't permanently been sailing.

740
00:37:38,480 --> 00:37:41,560
Speaker 1: No, gotcha? All right, Well, do you have any exciting

741
00:37:41,600 --> 00:37:42,480
Speaker 1: plans for the summer?

742
00:37:42,760 --> 00:37:45,040
Speaker 3: Well, I think you know, it's been some pretty hectic

743
00:37:45,080 --> 00:37:46,919
Speaker 3: years for us, to be quite frank. I mean, we've

744
00:37:47,000 --> 00:37:49,480
Speaker 3: been in the last many years, been growing the company

745
00:37:49,520 --> 00:37:51,600
Speaker 3: quite a lot. So I think for some vacation will

746
00:37:51,680 --> 00:37:54,680
Speaker 3: be you know, just what I say, normal relaxation. I

747
00:37:54,680 --> 00:37:57,320
Speaker 3: do like to ride the bike, particularly in the mountains,

748
00:37:57,320 --> 00:37:59,880
Speaker 3: and you know, probably hopefully you'll play a game of golf,

749
00:38:00,080 --> 00:38:01,920
Speaker 3: see if I can improve on that. But it will

750
00:38:01,960 --> 00:38:03,920
Speaker 3: be nothing more than that, just hopefully it's just reacts

751
00:38:03,920 --> 00:38:04,160
Speaker 3: a bit.

752
00:38:04,800 --> 00:38:06,920
Speaker 1: Well, if you ever come to the East coast of

753
00:38:06,960 --> 00:38:08,959
Speaker 1: the States in New York, New Jersey, we'll play around

754
00:38:09,000 --> 00:38:11,520
Speaker 1: of golf. Please hit me up. I'd love to get

755
00:38:11,520 --> 00:38:14,560
Speaker 1: out there with you. That'll be good. I'm absolutely terrible

756
00:38:14,600 --> 00:38:15,480
Speaker 1: what I play all the time.

757
00:38:15,520 --> 00:38:17,400
Speaker 2: Oh good, that'll be great. That's a good match for

758
00:38:17,440 --> 00:38:17,879
Speaker 2: me as well.

759
00:38:19,000 --> 00:38:21,640
Speaker 1: All right, Michael, I really appreciate your time today.

760
00:38:22,719 --> 00:38:24,359
Speaker 2: No problem is a place that to be here. Thank

761
00:38:24,360 --> 00:38:26,279
Speaker 2: you very much, all right, and I want to thank

762
00:38:26,320 --> 00:38:27,000
Speaker 2: you for tuning in.

763
00:38:27,040 --> 00:38:29,760
Speaker 1: If you liked the episode, please subscribe and leave review.

764
00:38:30,200 --> 00:38:32,880
Speaker 1: We've lined up a number of great guests for the podcast.

765
00:38:33,160 --> 00:38:38,839
Speaker 1: Please check back to hear conversations with C suite executives, shippers, regulators,

766
00:38:39,000 --> 00:38:43,399
Speaker 1: and decision makers within the freight transportation markets. Also, if

767
00:38:43,440 --> 00:38:46,399
Speaker 1: you have any ideas for a future episode, please hit

768
00:38:46,440 --> 00:38:49,680
Speaker 1: me up on the terminal, on Twitter at logistics Lee,

769
00:38:49,880 --> 00:38:59,799
Speaker 1: or on LinkedIn. Thanks a lot and take care everyone.

770
00:39:00,200 --> 00:39:00,239
Speaker 1: V