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States sell fuel tankers to fleet operator in confidential deal

States sell fuel tankers to fleet operator in confidential deal
Sarnia Cherie pictured in August 2017 when she and Sarnia Liberty were chartered to fuel HMS Queen Elizabeth during sea trials. (Royal Navy)
  • States of Guernsey have sold fuel tankers Sarnia Cherie and Sarnia Liberty to James Fisher Everard in confidential deal
  • Sale proceeds will enable full repayment of remaining loan from original 2008 purchase
  • Vessels were bought to ensure fuel supply security when few NAABSA vessels existed worldwide
  • Other suitable vessels now regularly deliver to Guernsey, removing need for States ownership
  • JFE confirms intention to continue including Guernsey in vessels' trading operations
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The States of Guernsey have sold their two fuel tankers to specialist fleet operator James Fisher Everard in a deal that will enable full repayment of the remaining loan from their original purchase.

The Sarnia Cherie and Sarnia Liberty were acquired by JFE this month through negotiations with JamesCo 750, the States-owned holding company established for the vessels.

Whilst the financial terms remain confidential, States' Trading Supervisory Board President Deputy Mark Helyar confirmed the sale proceeds would cover the outstanding debt associated with their 2008 purchase.

By the end of 2024, the latest figure published, the amount remaining from the States loan to JamesCo was £6,746,000; down from £7,519,000 in 2023 and £8,265,000 in 2022.

The disposal avoids the need for further States investment as both vessels approach the end of their originally anticipated operating life in 2027 and 2028.

The tankers were purchased by the States in December 2008 for £15.2m to ensure security of fuel supplies to the island. Most bulk shipments of liquid hydrocarbons, including oil, petrol and diesel, are imported through St Sampson's Harbours, which dries out at low tide.

The harbour is therefore only accessible by vessels specially designed to rest on the seabed when required, known as 'not always afloat but safely aground' or NAABSA vessels.

Key terms

NAABSA vessels
Vessels designed to 'not always be afloat but safely aground', meaning they can rest on the seabed during low tide without damage. These ships have specially reinforced flat bottoms that allow them to sit safely on the harbour floor when the tide goes out, rather than staying floating at all times.
St Sampson's Harbour in Guernsey dries out at low tide, so only NAABSA vessels can safely deliver fuel there - this makes them essential for the island's fuel security since most liquid fuel imports come through this harbour.
Bareboat charter
A shipping arrangement where the vessel owner rents out the ship without crew, equipment or provisions. The charterer takes full responsibility for operating the vessel, hiring crew, paying for fuel, insurance and maintenance during the charter period.
JamesCo 750 used bareboat charters to rent out Guernsey's fuel tankers to specialist operators while the States retained ownership - this allowed professional operation without direct States management.
International Maritime Organisation
The UN agency that sets global standards for ship safety, security and environmental protection. IMO creates the international rules that all ships must follow, covering everything from construction standards to crew certification.
As an island dependent on shipping, Guernsey must ensure its vessels comply with IMO regulations to operate internationally and maintain the island's maritime connections for trade and transport.
Classification certificates
Documents issued by independent maritime societies that certify a ship meets international safety and construction standards. Ships need valid classification to get insurance, enter most ports, and prove they are seaworthy.
Guernsey's fuel tankers needed current classification certificates to operate commercially and enter international ports - maintaining these certifications was one of the ongoing responsibilities that influenced the States' decision to sell.
States' Trading Supervisory Board
A committee of the States of Guernsey government that oversees all government-owned commercial operations. The STSB acts as shareholder representative for States-owned companies and manages unincorporated trading operations like harbours and waste services.
The STSB is unique to Guernsey's government structure, managing a diverse portfolio worth over £600 million including the airport, electricity company, postal service, and previously the fuel tankers - giving States political oversight of essential services.
Liquid hydrocarbons
Petroleum-based fuels in liquid form, including petrol, diesel, heating oil and other refined oil products. These are essential fuels that cannot be easily transported by other means to islands.
Guernsey imports virtually all its liquid fuels by ship through St Sampson's Harbour, making secure delivery of liquid hydrocarbons critical for the island's transport, heating and electricity generation needs.

When acquired by the States, the Sarnia Cherie and Sarnia Liberty were among only a small number of operational NAABSA vessels worldwide. This led to concerns that the island's fuel supply could be at risk if the owner sold the ships to another operator for deployment elsewhere.

However, such concerns have since receded as other NAABSA vessels have entered the market and regularly deliver fuel to the island. These include Thun Blyth and Thun Britain operated by The Geos Group.

Despite ownership by JamesCo 750, the States were not the operator of the vessels. Instead, they were chartered to JFE, which operates a fleet of 16 tankers throughout Europe and the Caribbean. Local fuel importers would contract with JFE to arrange their bulk shipments.

JFE has confirmed it intends to continue including Guernsey in the trading operation of the vessels following the purchase.

The Sarnia Cherie was constructed in 2007 and the Sarnia Liberty in 2008. JamesCo 750 was established as a holding company wholly owned by the States, with responsibilities including negotiating bareboat charters, ensuring vessels meet International Maritime Organisation regulations and technical standards, and retaining valid classification certificates.

Deputy Helyar said: "The fuel tankers were acquired because of concerns about the availability of suitable commercial vessels that could discharge safely at St Sampson's Harbour. Since then, other vessels have entered the market and are regularly delivering to Guernsey. There is therefore no longer a case for owning fuel tankers to maintain our security of supply.

"On the back of a review commissioned by the Committee for the Environment & Infrastructure in the last term, and accepted by the previous Policy & Resources Committee, the STSB was instructed to dispose of the tankers. That sale has now been completed."

The States' Trading Supervisory Board acts as shareholder of JamesCo 750 on behalf of the States. Due to the niche nature of its activities, JamesCo 750 does not publish annual accounts to avoid disclosing commercially sensitive information to its charter operator.

Background and history

The States of Guernsey purchased two specialist NAABSA vessels, the Sarnia Cherie and Sarnia Liberty, in 2008 to ensure security of fuel supplies to the island amid concerns about the limited availability of commercial vessels capable of discharging safely at St Sampson's Harbour. St Sampson's unique drying-out berths require fuel tankers to sit on the harbour bottom during cargo discharge, necessitating vessels specifically designed and certified as 'not always afloat but safely aground' (NAABSA) vessels with strengthened hulls. The Sarnia Cherie was built in 2007 and the Sarnia Liberty in 2008, with both vessels initially chartered to James Fisher Everard for operations while remaining under States ownership through the holding company JamesCo 750. Over time, demand for hydrocarbon fuels began to decline and shipping patterns changed, with hydrocarbon fuels needed in smaller volumes. A comprehensive review of fuel supply options was conducted, examining various scenarios to ensure security of supply while meeting future declining volumes. This work formed part of the States Trading Supervisory Board's broader Ports Programme examining all import requirements. The vessels were approaching the end of their originally anticipated operating life by the late 2020s, leading to the recent decision to dispose of them rather than require further States investment.

Earliest reference:
The earliest relevant precedent found is the establishment of St Sampson's drying-out berths where fuel tankers now discharge alongside berths where quarrymen once loaded stone onto sailing ships, highlighting the harbour's evolution from its original quarrying purpose to its current role in fuel supply infrastructure.

Q&A

Q: Why did the States originally buy the fuel tankers?
A: The States bought the Sarnia Cherie and Sarnia Liberty in 2008 to ensure security of fuel supplies to the island. At the time, they were among only a small number of operational NAABSA vessels worldwide that could safely discharge at St Sampson's Harbour, which dries out at low tide.

Q: Will the sale affect fuel deliveries to Guernsey?
A: No, James Fisher Everard has confirmed it intends to continue including Guernsey in the trading operation of the vessels. JFE was already operating the tankers under charter from the States-owned holding company.

Q: How much did the States receive for the sale?
A: The financial terms of the sale are confidential, but Deputy Mark Helyar confirmed the proceeds would enable full repayment of the remaining loan associated with the tankers' original purchase in 2008.

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