National Shipping Company of Saudi Arabia (Bahri) said it signed an agreement with the Arab Petroleum Investments Corporation (APICORP) to establish an investment fund worth around $1.5b, Reuters reported.

Bahri said that it is to subscribe to 15% of the fund’s capital, while APICORP will provide the remaining 85% of the needed investment. The fund aims to buy around 15 very large crude carriers (VLCCs) and Bahri will be the technical and commercial manager for the fleet of tankers.  APICORP, in return, will be responsible for securing the required financial resources to run the fund operations.

According to Trade Arabia, the agreement includes number of conditions to assure that the fund will meet its purpose.

The first phase of fundraising and the remaining processes are expected to be accomplished at the end of the third quarter of 2016. Bahri noted it expects the financial impact of the first phase to appear in the first quarter of 2017.