Kvaerner Philadelphia Shipyard Signs $240 Million Letter of Intent for Four Ships

Kvaerner, the Anglo-Norwegian engineering and construction Group, today announced that it has received a Letter of Intent from Keystone Shipping Company of Pennsylvania, for the construction of four handy- sized (40,000 dwt) clean product carrier vessels. The total value of the award amounts to approximately $240 million. The vessels are to be built at the new state-of-the-art shipyard in Philadelphia, formally opened today by Tom Ridge, the Governor of the Commonwealth Pennsylvania, and John Street, Mayor of Philadelphia.

Speaking at the inauguration of the new yard today in Philadelphia, which was coupled with the keel laying of the first ship that has been under construction at the yard since March 2000, Tom Ridge said: "Think about it. Just two years ago, commercial shipbuilding no longer existed in Philadelphia. Now with Kvaerner's help, we've ensured that world-class, state-of-the-art ships will be built well into the future -right here in this city."

"In more ways than one, we're building for the future." said Ron McAlear, President of Kvaerner Philadelphia Shipyard. `"With the completion of this yard - we're creating 1,000 jobs by launching the re-birth of shipbuilding in this city. Today's announcement of an agreement with Keystone is a solid expression of confidence in this facility."

Based on today's Letter of Intent the parties will now enter into negotiations with the objective of establishing a final contract. A final contract will be subject to MARAD Title XI or other equivalent financing arrangements.