Frontline Ltd. (the “Company” or “Frontline”) has agreed with Ship Finance International Limited (“Ship Finance”) to terminate the long term charter party between the companies for the single hull VLCC Front Sabang and Ship Finance has simultaneously sold the vessel on hire/purchase terms. Concurrently, the Company informs that the previously announced termination of the long term charter party between the companies for the single hull VLCC Front Duchess has been cancelled.
The Company expects the termination of the charter for Front Sabang to take place in April 2008 and Ship Finance will then make a compensation payment to Frontline of approximately $25 million for the early termination of the current charter party, which will be recognized in the second quarter of 2008.
March 11, 2008
The Board of Directors
Questions should be directed to:
Bjørn Sjaastad: Chief Executive Officer, Frontline Management AS
+47 23 11 40 99
Inger M. Klemp: Chief Financial Officer, Frontline Management AS
+47 23 11 40 76
Cautionary Statement Regarding Forward Looking Statements
This press release may contain forward looking statements. These statements are based upon various assumptions, many of which are based, in turn, upon further assumptions, including Frontline management’s examination of historical operating trends. Although Frontline believes that these assumptions were reasonable when made, because assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, Frontline cannot give assurance that it will achieve or accomplish these expectations, beliefs or intentions.
Important factors that, in the Company’s view, could cause actual results to differ materially from those discussed in this presentation include the strength of world economies and currencies, general market conditions including fluctuations in charter hire rates and vessel values, changes in demand in the tanker market as a result of changes in OPEC’s petroleum production levels and world wide oil consumption and storage, changes in the Company’s operating expenses including bunker prices, dry-docking and insurance costs, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, and other important factors described from time to time in the reports filed by the Company with the United States Securities and Exchange Commission.