KNOT Offshore Partners‘ subsidiary KNOT Shuttle Tankers has signed a $115m agreement to acquire Knutsen NYK Shuttle Tankers 16, which owns Ingrid Knutsen.

Delivered in December 2013, Ingrid Knutsen is operating in the North Sea under a ten-year time charter with ExxonMobil’s Norwegian subsidiary Standard Marine Tønsberg, which will expire in the first quarter of 2024.

According to Knot Offshore, the acquisition is expected to generate $3.9m of net income and $11.5m of earnings before interest, taxes, depreciation, and amortisation (EBITDA) next year.

"The acquisition is expected to generate $3.9m of net income and $11.5m of EBITDA next year."

Knot Offshore entered an amended time charter with Repsol Sinopec Brasil for the Carmen Knutsen tanker in September, extending the duration of the time charter for another five years.

The amended time charter is effective until February 2023, and during this period the average charter rate is expected to be reduced by 6.2%.

Knot Offshore Partners CEO and CFO John Costain said: "The acquisition of Ingrid Knutsen, together with the extension of the Carmen Knutsen time charter, are very positive developments for the partnership, increasing the average fixed employment of the fleet from five years to 5.8 years and growing the partnership’s fleet to ten vessels.

"The benign US dollar interest rate environment while adversely affecting the Carmen Knutsen’s extension rate continues to limit the partnership’s financial expenses."

The acquisition is subject to customary closing conditions with completion slated to take place within 30 days.

Knot Offshore owns, operates and acquires shuttle tankers under long-term charters in the offshore oil production regions of the North Sea and Brazil.