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Gulf Navigation announces receipt of full refund of second terminated new building contract

2010-06-16

Gulf Navigation Holding PJSC (DFM: GULFNAV) the leading ship owning and Maritime Services Company in the region, announces that Gulf Mizhar Shipping Inc. ("Gulf Mizhar"), a wholly owned subsidiary of Gulf Navigation Holding PJSC, has now also received full payment along with interest from SLS Shipbuilding Co. Ltd of Tongyeong, Korea (“SLS”) in respect to its termination of the new building contract relating to the 44,000 DWT product/chemical tanker vessel bearing hull n° S489 (the “Contract”).  The amount received is in excess of USD 35m, bringing the total amount received in excess of USD 70m. The contract was terminated due to excessive delays in relation to the delivery of the vessel. Now having received its full payment with interest for both vessels, the Company is in a strong position to execute new purchases at current market rates significantly lower than before. The refund of the interest bearing instalments will have a positive effect on the company’s result, and increase its cash reserves to help with future acquisitions.