The Arab Petroleum Investments Corporation (Apicorp) announced the establishment of a Petroleum Shipping Fund of US $150 million aimed at leveraging growth opportunities in the petroleum product tanker charter market.
The government of UAE owns a 17% stake in Apicorp, the multilateral development bank owned by the Organization of Arab Petroleum Exporting Countries (OAPEC)
This is the first fund in the region aimed at a specific vessel category, the release said.The fund has acquired five medium range (MR) petroleum product tankers. These will be employed in the regional and international tanker market for five years to help meet the projected upsurge in demand for petroleum product carriers. The Fund is co-managed by Tufton Oceanic, a global fund manager in the maritime and energy-related industries.
Ahmad Bin Hamad Al Nuaimi, Apicorp’s CEO and GM said: “Apicorp Petroleum Shipping Fund is a $150 million Shariah-compliant Fund aimed at helping oil and gas companies grow their business while also generating regular yield and returns for the equity investors. In this case, the Fund helps companies meet their requirements for petroleum products transportation without burdening their balance sheets. At the same time, the Fund provides a mechanism for regional investors to participate in a highly specialized investment class in international marine assets that is not normally open to them.”
“We are exploring the development of similar new funds in shipping and other oil and gas sectors to take advantage of further such growth opportunities. Tufton Oceanic’s strong capabilities in managing funds and deep knowledge of the global shipping sector make it the ideal partner for this Fund. Our partnership with them brings the required technical expertise to the region in investing and managing investment funds focused on shipping assets,” Al Nuaimi added.
Marcus Machin, Director, Tufton Oceanic said: “The positive outlook for demand growth in the global product tanker market creates the right conditions for the success of the Fund. The growth of rapidly industrializing mega-economies like China and India is expected to drive volumes of seaborne petroleum products in the next few years. Combined with changes in trade patterns, this is expected to lift product carrier demand growth above general global economic activity in the coming years.”
