On September 3, 2024, KNOT Offshore Partners LP announced that its subsidiary, KNOT Shuttle Tankers AS, has finalized agreements with its sponsor, Knutsen NYK Offshore Tankers AS (KNOT), to execute a major fleet swap. The deal involves two key transactions: acquiring the shuttle tanker Tuva Knutsen from KNOT and selling the shuttle tanker Dan Cisne to KNOT. The transactions will be carried out through the purchase and sale of the entities owning the respective vessels.

The purchase price for the Tuva Knutsen is set at $97.5 million, minus $69.0 million in existing debt and plus $0.4 million in capitalized fees related to the vessel's credit facility. The Dan Cisne will be sold for $30 million. After adjusting for these amounts, KNOT will make a net payment of $1.1 million to the Partnership, subject to standard working capital adjustments. The transactions are expected to be completed on the announcement date.

The Tuva Knutsen is a DP2 Suezmax class shuttle tanker with a deadweight of 153,000 tons, built by COSCO Shipping Heavy Industry and delivered in 2021. Currently, it operates in Brazil under a charter contract with TotalEnergies, which runs until February 2026, with options for extension. KNOT has effectively guaranteed the hire rate for the Tuva Knutsen through August 2031, ensuring seven years of fixed employment for the vessel, even if TotalEnergies does not exercise its extension options.

The transaction received approval from the Partnership’s Board of Directors and independent Conflicts Committee, with guidance from an external financial advisor and legal counsel. Derek Lowe, CEO of the Partnership, expressed satisfaction with the deal, noting that swapping the Dan Cisne for the Tuva Knutsen will expand the fleet without needing new funding, while also enhancing the company's portfolio of long-term contracts. This swap reduces the average age of the fleet and increases its focus on the most sought-after shuttle tanker class. Lowe emphasized the importance of this strategic move in addressing long-standing challenges and advancing KNOP’s growth trajectory, highlighting the commitment to generating stable cash flows and creating value for unitholders.

KNOT Offshore Partners LP is involved in the ownership, operation, and acquisition of shuttle tankers, focusing mainly on long-term charters in the offshore oil production areas of Brazil and the North Sea.

As a publicly traded master limited partnership, KNOT Offshore Partners LP is treated as a corporation for U.S. federal income tax purposes, issuing Form 1099 to its unitholders instead of Form K-1. Its common units are listed on the New York Stock Exchange under the ticker symbol “KNOP.”