China Eximbank provides $321.6 million USD loan to Frontline Ltd. to partially finance construction of eight vessels

Project narrative

In November 2016, the Export-Import Bank of China (‘China Eximbank’) agreed in principle to provide a $321.6 million USD senior secured term loan facility to Frontline Ltd. to partially finance the acquisition of eight newbuilding vessels by Frontline. The facility, which was subject to final documentation, was to be secured by (i.e. collateralized against) Frontline’s four Suezmax tankers and four LR2 tankers. Then, in February 2017, China Eximbank signed a $321.6 million senior secured term loan facility agreement with Frontline Ltd. to partially finance the acquisition of eight newbuilding vessels by Frontline. The loan carried a maturity of 16 years (final maturity date: 2033), an interest rate of LIBOR plus an unspecified margin (said to be typical of Frontline's facilities), and an amortization profile of 15 years. It was insured by China Export and Credit Insurance Corporation (Sinosure). Frontline drew down $252.7 million USD from the facility in 2017 in connection with four Suezmax tankers and three LR2/Aframax tankers delivered in that year. In 2018, Frontline drew down $32.0 million USD in connection with one LR2 tanker delivered that year. The facility was fully drawn down as of December 31, 2019.