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Correction to Shipping Magnate Calls End to Oil Rout

By Costas Paris | Dow Jones Newswire

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Shipping magnate John Fredriksen is trying to buy more oil tankers despite a glut of vessels afloat, a looming $10 billion in debt and two failed takeover attempts that have left his empire reeling.

The self-made billionaire, who also is a major player in offshore oil drilling and salmon farming, says he is working 17-hour days as he looks to expand his fleet of the most voluminous tankers — known as very large crude carriers, or VLCCs. He also is pressing forward with a messy restructuring of his offshore-drilling business, Seadrill Management Ltd.

“We used to be the biggest VLCC owner, but now we are No. 4” as his tanker company, Frontline Ltd., shrank while rivals expanded, said Mr. Fredriksen in a rare interview earlier this month. “I’m looking to invest more than two billion [dollars] in acquisitions,” he said, noting he is primarily looking to acquire companies outright rather than buying tankers from rivals.

An oversupply of cheap oil and too many tankers chasing too little cargo has respectively hit drilling and shipping hard. Mr. Fredriksen reckons shipping companies will scrap three times as many tankers this year than they did last year, with fewer new vessels coming to market.

“Around 150 very large crude carriers, or about 20% of the existing fleet, will be scrapped over the next couple of years,” said the 73-year-old, known in the industry as “Big John.” “To have a say in the market you have to have size, so I’m looking to buy tankers all the time.”

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By Costas Paris | Dow Jones Newswire

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