Overseas Shipholding Group, Inc. to Upgrade Engines on Alaskan Class Vessels

Overseas Shipholding Group, Inc. (the “Company” or “OSG”), a leading provider of energy transportation, announced a comprehensive lifecycle engine upgrade (LCU) program for all four vessels in its Alaskan Class fleet to be achieved through a contract with MAN Energy Solutions SE. The vessels Alaskan Explorer, Alaskan Frontier, Alaskan Legend, and Alaskan Navigator, all approaching 20 years in age, will receive significant engine and operational improvements, resulting in environmental benefits as well as extending their commercially useful life.

The lifecycle engine upgrades involve a series of technical and commercial enhancements, including:

• Engine component replacements with newer, more fuel-efficient models, leading to reduced fuel consumption and lower greenhouse gas emissions.
• Installation of advanced control systems and optimization technologies to allow crews to operate the vessels in a more efficient manner, maximizing performance while reducing overall environmental impact.
• Capability to meet Carbon Intensity Indicator (CII) regulations without sacrificing operational capacity of the vessels for years to come.
• “Ready for Methanol” capability.

The LCU program is scheduled to begin in early 2024 in conjunction with plans to reactivate the recently acquired Alaskan Frontier. The remaining three vessel engine upgrades will be conducted concurrently with scheduled vessel drydocking periods through 2026, which will mark the completion of the project.

“The decision to contract with MAN Energy Solutions for engine Life Cycle Upgrades on all four Alaska class tankers represents a major investment in the future of our company,” stated Sam Norton, President and CEO of OSG. “When combined with previously announced commitments to reactivate the Alaskan Frontier, the aggregate investment we will be making into our Alaskan fleet over the next three years will be close to $100 million.”

Mr. Norton continued, “The benefits of this substantial investment will be multiple. We expect improvements in fuel oil consumption, which will result not only in substantial cost savings, but as importantly in an estimated annual reduction of over 20,000 metric tons of greenhouse gas emissions based on historical trading patterns for each of these vessels. OSG has set a target of achieving a 15% reduction in annual CO₂ emissions by 2030 and this investment alone should account for roughly one-third of that target. In addition, the anticipated improved emissions attained from the engine upgrades should allow all our Alaskan class vessels to operate in their historical trading patterns while maintaining compliance with current Carbon Intensity Index (CII) regulations through at least 2035.”