Scorpio Tankers Inc. · NYSE:STNG
Scorpio Tankers — Capital Link Webinar Series (January 2022)
37 slides from Scorpio Tankers's conference presentation, Jan 26, 2022
Slide 1: Scorpio Tankers Inc. Capital Link Webinar Series Presentation
Scorpio Tankers Inc. Capital Link Webinar Series Presentation January 26, 2022
Slide 2: Disclaimer and Forward-looking Statements
Disclaimer and Forward-looking Statements This presentation includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Scorpio Tankers Inc.’s (“Scorpio’s”) curr
Slide 3: Scorpio Tankers at a Glance
Scorpio Tankers at a Glance Key Facts Fleet Overview Largest Product Tanker Fleet in the World • Scorpio Tankers Inc. (“Scorpio”) is the world’s largest product with 131 Vessels on the Water tanker owner, providing marine transportation of refined 14x 63x petroleum products (gasoline, diesel, jet fu
Slide 4: Investment Highlights
Investment Highlights • 131 wholly owned, finance leased or bareboat chartered-in tankers on the water with an average age of 6.0 years The Largest & Most Modern Product Tanker Fleet in the • 98 product tanker vessels equipped with exhaust gas scrubbers World • Vessels trading within one of the worl
Slide 5: Largest & Most Modern Product Tanker Fleet in the World
Largest & Most Modern Product Tanker Fleet in the World • World’s largest and youngest product tanker fleet, including the leading owner in the MR and LR2 product tanker segments • While a significant portion of the global MR and LR fleets are older than 15 years of age, the Scorpio fleet has an ave
Slide 6: Scrubber Fuel Savings
Scrubber Fuel Savings • As of November 10, 2021 the Company has 98 vessels currently installed with exhaust gas cleaning systems (“scrubbers”) Scorpio Scrubber Fleet Scorpio TCE Savings Annual Cash Flow Benefit (Vessels installed with scrubbers) ($/day) (Millions $USD) 80 $2,509 $102.6 70 $2,091 60
Slide 7: Liquidity
Liquidity Pro Forma Liquidity • As of November 10, 2021, the Company had $228.9 million in unrestricted cash and cash equivalents. Millions $USD $400.0 • The Company raised $5.1 million from vessel refinancing's between November 10 and December 13, 2021 • In December, the Company signed a transactio
Slide 8: Limited Capex & Upcoming Maturities Have Been Refinanced
Limited Capex & Upcoming Maturities Have Been Refinanced • Since 2018, the Company completed $445.8 million in capex payments for drydock, ballast water treatment systems and scrubbers • Remaining capex for FY-21 is $12.8 million • The Company has $18 million of committed scrubber financing that has
Slide 9: Potential Cash Flow Generation
Potential Cash Flow Generation Potential Annual Cash Flow Generation Excluding Debt Repayment Potential Annual Cash Flow Generation Including Debt Repayment Millions $USD Millions $USD $2,500 $2,500 $2,000 $2,000 $1,500 $1,500 $1,095 $856 $1,376 $617 $1,137 $1,000 $1,000 $378 $898 $139 $658 $419 $28
Slide 10: Asset Values Have Increased Significantly Over the Last Year
Asset Values Have Increased Significantly Over the Last Year MR & LR2 Tanker Asset Values Historical MR & LR2 Tanker Asset Values MR 5 Yr LR2 5 Yr MR 5 Yr LR2 5 Yr $50.0 $60 $47.5 $43.0 $50 $40.0 $35.0 $40 $30.0 $30.0 $29.0 $27.5 $30 $20.0 $20 $10.0 $10 $0.0 $0 Jan-21 Dec-21 Jan-22 Jan-12 Jan-13 Jan
Slide 11: Oil Demand by End Use
Oil Demand by End Use Global Crude Oil Demand by End Use (mb/d) 103.7 100.0 4.7 4.9 90.7 11.4 11.1 4.9 10.9 13.1 12.9 12.7 14.8 13.7 4.3 4.2 13.0 2.0 1.9 7.1 6.7 3.9 1.8 3.5 44.6 46.3 40.0 2019 2020 2025 Road Aviation Rail/waterways Marine bunkers Petrochemicals Other industry Resid/Comm/Agr Electri
Slide 12: Oil Demand Expected to Exceed Pre-Covid Levels in 2022
Oil Demand Expected to Exceed Pre-Covid Levels in 2022 Global Crude Oil Demand (mb/d) 105.0 101.6 101.8 100.5 99.7 99.9 100.0 98.1 98.0 97.3 96.2 95.0 95.0 93.5 92.4 92.5 90.9 89.7 90.0 88.4 85.0 80.0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Q1-22 Q2-22 Q3-22 Q4-22 Source: Energy
Slide 13: Jet Fuel Demand Narrows Gap to Pre Covid Levels
Jet Fuel Demand Narrows Gap to Pre Covid Levels Global Jet Fuel Demand (mb/d) (1) 9.0 Jet Demand Forecasted 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Jan-20 May-20 Sep-20 Jan-21 May-21 Sep-21 Jan-22 May-22 Sep-22 1) Energy Aspects, January 2022 13
Slide 14: Refined Product Demand to Exceed Pre-Covid Levels in 2022
Refined Product Demand to Exceed Pre-Covid Levels in 2022 Refined Product Demand (mb/d) 70.2 71.4 69.1 69.9 68.7 67.4 66.8 66.2 63.4 64.3 62.1 62.5 60.1 61.1 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H-22 2H-22 Diesel Gasoline Jet Fuel Naphtha Source: Energy Aspects, January 2021
Slide 15: Significant Draws in Refined Product Inventory Since Jan 2021
Significant Draws in Refined Product Inventory Since Jan 2021 North America, Europe & OECD Asia Inventories - Gasoline & Distillate (Million barrels) 1100 1,051 1,055 1,057 1,057 1,048 1,013 1,015 1,017 1,011 999 1,003 1,006 1000 983 966 968 972 969 962 938 937 904 900 881 876 800 700 600 Jan-20 Feb
Slide 16: Refined Product Inventories Approach Historically Low Levels
Refined Product Inventories Approach Historically Low Levels North America, Europe & OECD Asia Inventories - Gasoline & Distillate (Million barrels) 1,100 1,050 1,000 950 900 850 800 Nov-10 May-11 Nov-11 May-12 Nov-12 May-13 Nov-13 May-14 Nov-14 May-15 Nov-15 May-16 Nov-16 May-17 Nov-17 May-18 Nov-1
Slide 17: Global Refining Capacity Additions
Global Refining Capacity Additions Global Refining Capacity Additions (mb/d) 3.0 2.5 2.0 1.7 1.6 1.6 1.6 1.5 1.4 1.3 1.3 1.3 1.2 1.2 1.2 1.1 1.1 1.0 1.0 1.0 0.9 0.9 0.9 0.8 0.8 0.7 0.5 0.5 0.5 0.4 0.4 0.3 0.3 0.3 0.2 0.0 0.0 0.0 -0.5 -0.7 -1.0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2
Slide 18: Impact of Closing Australia's Kwinana & Altona Refinery
Impact of Closing Australia’s Kwinana & Altona Refinery Australia Refining Capacity • BP announced that they are closing their 146 kb/d Kwinana refinery in Australia at the end of 2020 Refinery Owner Capacity (kb/d) Status Altona Exxon Mobil 90 Closing • In February 2021 Exxon Mobil announced that t
Slide 19: Australia's Product Imports Increase as Refinery Output Declines
Australia’s Product Imports Increase as Refinery Output Declines Australia Refinery Output (k/bd) (1) Australia Product Imports (k/bd)(1) 800 900 Refinery Output Product Imports 819 800 700 682 657 628 708 700 686 604 661 600 640 636 633 613 596 515 600 503 550 556 500 479 469 459 420 500 408 400 42
Slide 20: Orderbook as % of Fleet at Historical Low
Orderbook as % of Fleet at Historical Low Orderbook as a % of Fleet 19.0% Product Tanker 10K+ Orderbook % Fleet 5 Yr Avg 10 Yr Avg 14.0% 9.0% 5.6% 4.0% Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 S
Slide 21: Number of Product Tankers on Order is at a 20 Year Low
Number of Product Tankers on Order is at a 20 Year Low Product Tanker Vessels on Order (# of Vessels) MR LR1 LR2 800 760 738 700 126 118 641 600 100 139 140 500 446 115 447 386 55 59 400 375 343 352 353 336 42 103 93 73 37 43 70 78 300 107 13 232 86 77 228 233 34 480 495 59 217 221 223 24 426 28 20
Slide 22: Product Tanker Scrapping at 20 Year High
Product Tanker Scrapping at 20 Year High Product Tanker Scrapping (# of Vessels) MR LR1 LR2 50 48 42 9 40 4 36 4 35 9 5 7 30 7 24 24 22 20 3 20 3 14 6 3 2 16 5 16 35 3 13 29 2 13 8 12 12 4 1 24 10 9 9 9 4 7 8 1 0 17 6 6 6 16 15 16 4 14 3 0 1 7 4 12 9 3 10 2 8 8 1 5 5 6 2 4 3 3 0 0 1 2 2 2000 2001 20
Slide 23: Seaborne Product Exports to Outpace Supply in 2022
Seaborne Product Exports to Outpace Supply in 2022 Seaborne Exports vs Product Tanker Fleet Growth Product Tanker Net Fleet Growth Seaborne Refined Products Exports 10.0% 7.4% 5.9% 5.7% 6.3% 5.7% 5.0% 4.9% 4.8% 4.5% 4.2% 4.0% 2.6% 2.0% 1.6% 1.9% 1.3% 1.1% 2.5% 1.3% 0.0% -0.3% -1.0% -5.0% -5.0% -10.0
Slide 24: Significant % of the Fleet Turning 15 Years & Older
Significant % of the Fleet Turning 15 Years & Older Fleet Age Profile Today Fleet Age Profile 2025 (1) (# of Vessels) (# of Vessels) HM/MR LR1/LR2 HM/MR LR1/LR2 1,000 999 1,000 845 800 776 307 800 282 687 197 619 600 136 600 560 558 160 135 403 177 400 400 110 692 579 267 563 36 245 551 459 200 73 4
Slide 25: Increasing Environmental Regulations to Benefit Modern Vessels
Increasing Environmental Regulations to Benefit Modern Vessels • The EU has put pressure on the IMO to accelerate it’s 2030 GHG emission targets and may implement its own ETS by 2023 • It’s unclear how the timeline of these plans will accelerate, but the focus on reducing GHG emissions in the shippi
Slide 26: Long Term Fundamentals
Long Term Fundamentals Refined Product Demand Expected to Continue to Recover through 2022 • Refined product ton mile demand is estimated to increase 9.3% and 5.7% in 2022, respectively (1) Refining Capacity Closures & Expansions Expected to Increase Product Exports & Ton Miles • Older and less effi
Slide 27: Appendix
Appendix 27
Slide 28: Product Tanker Demand Drivers
Product Tanker Demand Drivers Increased Volumes Voyage Distance Product Tanker (Seaborne Trading Activity Demand Exports) (Ton Mile Demand) • Oil consumption • Dislocation • Arbitrage opportunities growth between refinery from price volatility and consumer • Refinery margins • Low inventory levels •
Slide 29: Product Tankers in the Oil Supply Chain
Product Tankers in the Oil Supply Chain • Crude Tankers provide the marine transportation of the crude oil to the refineries. • Product Tankers provide the marine transportation of the refined products to areas of demand. • Structural demand drivers in the product tanker industry: • US has emerged a
Slide 30: What is in a Barrel of Crude Oil?
What is in a Barrel of Crude Oil? Source: Valero & EIA, December 2019 30
Slide 31: Product & Crude Tankers
Product & Crude Tankers Tankers “Dirty” “Clean” Crude Products Vessel VLCC Suezmax Aframax Panamax Handysize LR2 LR1 Hmx/MR Handysize (200,000 + (120,000 - (80,000 - (60,000 - (< 60,000 (80,000- (60,000- (25,000- (<25,000 Size DWT) 200,000 DWT) 120,000 DWT) 80,000 DWT) DWT) 120,000 DWT) 80,000 DWT)
Slide 32: Product Tanker Specifications
Product Tanker Specifications IMO Classes I, II, & III IMO Class I Chemical IMO Class I refers to the transportation of the most hazardous, Tankers very acidic, chemicals. The tanks can be stainless steel, epoxy or marine-line coated. IMO Class II Chemical & Product Tankers IMO Class II carries Veg
Slide 33: Design Features on Scorpio Product Tankers
Design Features on Scorpio Product Tankers 33
Slide 34: Scrubber Fuel Savings
Scrubber Fuel Savings Consumption figures below assume that: • Scrubbers do not operate during any port activities • Each voyage has a load and discharge port in an ECA, i.e. scrubber does not operate in ECA waters Annual ECO Vessel Fuel Consumption (MT/year) (1) Sailing (Ballast & Laden) MR LR1 LR2
Slide 35: Global Refinery Closures Accelerate
Global Refinery Closures Accelerate Announced Refinery Closures • Global oil refining is being reconfigured and will have Operator Location Capacity (kbd) Timing a significant change on future global trade patterns MPC Martinez, CA(USA) 161 2020 • Older refineries have faced a wave of closures due t
Slide 36: Potential Cash Flow Generation Per Share
Potential Cash Flow Generation Per Share Potential Annual Cash Flow Generation Excluding Debt Repayment Potential Annual Cash Flow Generation Including Debt Repayment Millions $USD Millions $USD $40.0 $40.0 $30.0 $30.0 $18.8 $23.6 $14.7 $20.0 $20.0 $19.5 $10.6 $15.4 $6.5 $11.3 $2.4 $7.2 $4.8 $10.0 $
Slide 37: www.scorpiotankers.com
www.scorpiotankers.com
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