Frontline Pays Big to Terminate Charter Contracts
OSLO, Nov 7 (Reuters) – Oil tanker firm Frontline has terminated two charter contracts with Ship Finance International Limited and agreed to pay $90 million in compensation for the early termination, it said on Thursday.
Frontline, the tanker arm of billionaire tycoon John Fredriksen, will pay $11 million upon termination in November while the rest will be recorded as notes payable, with similar amortisation profiles to the current lease obligations, with reduced rates until 2015 and full rates from 2016, it said.
“These transactions will reduce the company’s obligations under capital leases by approximately $105 million and the remaining obligations under capital leases following these terminations will be approximately $735 million related to 15 VLCCs and five Suezmax tankers,” Frontline said.
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