Pyxis Tankers, one of the owners of MR tankers based in Greece, has signed a two-year charter agreement with CITGO Petroleum worth $31,000 per day. This contract allows Pyxis Tankers to generate a net income of approximately $21.8 million from this agreement.
Contract Details and Its Impact on Revenue
The Pyxis Lamda tanker, built in 2017 and with a capacity of 50,145 deadweight tons, will be employed under this contract for 24 months, with a 30-day extension option at the lessor's discretion. This new hire will commence after the completion of special inspections and dry docking of the tanker, which is likely to take place on November 20. This contract clearly indicates a significant increase from the previous contract for this tanker, which was $23,000 per day, thus adding $8,000 to the daily rate.
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Financial Implications and Future of Pyxis Tankers
Pyxis Tankers has projected that this new contract will generate approximately $21.8 million in net income after deducting a 2.5% commission over a period of 720 working days. Additionally, this contract will approximately add $7.7 million in annual EBITDA and $5.2 million in annual net income to the company. The higher rate of this contract means an increase of $2.8 million in annual income after commissions compared to the previous tanker hire.
This contract will expand Pyxis's relationship with CITGO while providing the tanker owner with greater visibility into future revenues as the product tanker market remains strong. Pyxis Tankers, under the management of Eddie Valantis, owns three MR2 tankers and three dry cargo ships. The company's tanker fleet also includes Pyxis Theta and Pyxis Karteria, bringing the total MR cargo capacity of the company to less than 149,000 deadweight tons.
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