Frontline cancels contracts for three VLCC's

John Fredriksen-controlled tanker carrier Frontline has to pay USD 58.8 million to cancel contracts with another Fredriksen company.

John Fredriksen-controlled tanker carrier Frontline has reached an agreement with similarly Fredriksen-controlled Ship Finance International to cancel long-term contracts for three 1999-built VLCC's. The decision is made in an effort to avoid putting the ships through a costly 15-year service check, and Ship Finance has instead sold the three ships to an unnamed third party, says Frontline in a statement on Thursday.

Financially struggling Frontline has agreed to pay Ship Finance USD 58.8 million in compensation, of which USD 10.5 million will be paid when the contracts expire in the 4th quarter 2014, while the rest will be spread out across 2015 and 2016.

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