Geoffrey Scott

Geoff Scott inquired about any resolution of protocols for the demolition of the non-compliant (shadow) fleet.

Answer

Svein Moxnes Harfjeld, President and CEO, stated that one of the two largest cash buyers in the demolition market is seeking OFAC approvals to acquire and demolish sanctioned ships. He believes this process makes sense for all parties to resolve and get the activity going, as many old shadow fleet vessels are losing work. Mr. Harfjeld did not have an update on the status or specific process but expressed encouragement that a process has begun.

Geoffrey Scott asked if there has been any resolution of protocols for the demolition of the non-compliant fleet. He followed up by asking if this resolution is expected to happen sooner rather than later.

Answer

Svein Moxnes Harfjeld (President and CEO, DHT Holdings Inc) stated that one of the two largest cash buyers in the demolition market is seeking approvals from the U.S. and OFAC to acquire and demolish sanctioned ships. He believes this resolution is crucial for everyone, as many old shadow fleet vessels are losing work and need to be scrapped. Mr. Harfjeld could not provide a specific timeline for the resolution, citing uncertainty about the OFAC process and political support, but expressed encouragement that a process has begun.

Geoffrey Scott of Scott Asset Management asked about the lack of vessel demolition activity and DHT's ability to track the sanctioned fleet's utilization. He also questioned the significant improvement in financing spreads DHT achieved between its April and July credit facilities.

Answer

President & CEO Svein Moxnes Harfjeld stated that tracking the dark fleet is difficult but its productivity is low. He believes high secondhand values for these ships disincentivize scrapping and that a global effort is needed to resolve the issue. On financing, he attributed the favorable terms to DHT's strong balance sheet, low leverage, and solid track record, which make it an attractive partner for its lending banks.

Geoffrey Scott asked for clarification on the significant increase in planned dry docks for the next 12 months and questioned why older, OFAC-listed ships are not being scrapped.

Answer

Executive Inger Klemp explained the higher dry dock count is due to the 12-month forecast now including a heavy dry-docking schedule in Q1 2026. Executive Lars Barstad noted that scrapping is hindered because the dollar-based recycling industry cannot legally purchase sanctioned vessels, creating a 'clog' that requires regulatory intervention, likely from the IMO, to resolve.

Geoffrey Scott asked for clarification on the timeline for commercial development activity at Sky Ranch, as well as recent trends in the pricing of both water tap fees and residential lots.

Answer

Executive Mark Harding projected that significant commercial development activity would likely begin in 2026. He confirmed that water and wastewater tap fees have risen substantially, from approximately $26,000 at the project's inception to a projected $38,000. Similarly, he stated that lot prices have increased from around $75,000 in the first phase to nearly $120,000 in current phases, reflecting strong market demand and value appreciation.

Asked about the timeline for commercial development at Sky Ranch and recent price trends for both water tap fees and residential lots.

Answer

Major commercial development activity is not expected until 2026. Both water tap fees and lot prices have increased significantly. Tap fees have risen from around $26,000 to a proposed rate near $38,000, while lot prices have increased from about $75,000 in the first phase to around $120,000 in current phases.