Vet67to82's Blog : Crude Supply and Shipping

I like shippers that have the majority of their fleet under contract. Contracts that include profit sharing when the day rates exceed contract rates and limit the downside when spot market day rates drop.

DHT announced (12/1/2008) OSG invoked the contract extentions for 18 months for several ships, the extensions increase DHT's fixed charter coverage from an average of 3.7 years to 4.6 years for the total fleet of 9 vessels. The contracted fixed charter hire revenues for the Company will increase by a minimum $70 million to about $400 million as a result of the extensions. The profit sharing arrangement, whereby DHT earns an additional amount equal to 40% of the excess of vessels' actual net daily earnings, will remain in place for all vessels.

DHT had about $100 million in cash, but recently paid down $50 mil in long term debt, clearly looking beyond the global meltdown to the future global recovery.