The financially-troubled Lithuanian Shipping Company (LSC) has reached the agreement to extend its loan facility on Medium Range tankers Latgale and Zemgale for a further period of two years.

The deal, reached with Crédit Agricole Corporate and Investment Bank, covers the amount of USD 33.2 million.

“An extension of the existing bareboat charters was a mandatory pre-condition of the lending bank in order to provide sufficient security and stable cash flow for the loan facility,” the Chairman of the LSC Management Board, Robert Kirkup, said.

The vessels Latgale and Zemgale, used for transportation of oil and chemical products, were built and acquired in 2011 from Korean shipbuilder Hyundai Mipo Dockyard Co., Ltd.

As part of the state-owned company’s bankruptcy procedure, the LSC’s fleet of five vessels was put up for auction following a ruling from Klaipeda Regional Court.

Out of the five vessels initially auctioned by the company’s bankruptcy administrator at the beginning of March, LSC managed to sell three ships, namely, the the 17,800 dwt vessels Romuva and Voruta, which were sold for EUR 2.17 million and EUR 2.25 million, and the 1994-built Deltuva, which was reportedly sold for EUR 1.7 million.

In December 2015, Klaipeda County Court initiated the enterprise bankruptcy proceedings against Lithuanian Shipping Company amid ongoing financial troubles that plunged the bulker owner and operator deep in debts.

LSC has been on a losing streak since 2008 as its last reported accumulated loss increased to EUR 20 million.