Farstad Shipping is set to order two UT751E newbuilds

December 3, 2004

Farstad set to order PSV's

Norway's Farstad Shipping has today received a Letter of Intent from Norsk Hydro for long term contracts for three Platform Supply Vessels.

The value of the contracts is some NOK 1.0 billion (about US$162 million).

The contract periods are for 5 years, 10 years and 10 years respectively.

The 5 year contract, which starts in April 2005, will be serviced by Far Symphony, a vessel that is already working for Norsk Hydro.

The two 10-year contracts start in August 2005 and October 2006, respectively.

For these contracts, two UT 751E newbuilds will be ordered, representing an investment in excess of NOK 500 million (about US$ 81 million).

In addition to the long-term PSV contracts, the Letter of Intent also includes award of a Frame Agreement nominating Farstad Shipping as the main supplier of spot vessels to Norsk Hydro. This Frame Agreement includes both PSV and AHTS tonnage.

Currently, Farstad is negotiating newbuilding orders for the two UT751E's with several yards. Norwegian yards are the most likely choice.

The first of the 10-year contracts will be serviced by Farstad's Far Swan until the first newbuild UT751E is delivered in the second quarter of 2006.

The UT 751E is a new PSV-design, characterised by high capacities both above and below deck.

The Vessels will have a length of 93 m and a breadth of 21 m, providing a deadweight in excess of 5,000 tonnes.

Farstad says the vessels have a strong focus on environmental and operational safety, and will be constructed to the highest DNV Class, including the notations "Clean," "Comfort," "NAUT-OSV" and "DP-AUTR."

Farstad says these vessels will be the very first to be equipped with Automatic Hose handling system, and as such represent a milestone in the development of more safe and mechanised operations offshore.

"Further," says Farstad, "we appreciate the significant environmental contribution of a very low fuel oil consumption and the cleaning of exhaust gases due to the installation of catalytic exhaust gas cleaning. This will severely reduce the vessel's NOx emissions."

The vessels are designed for especially good motion characteristics, which, says Farstad, "is important in order to provide more safe and efficient working conditions offshore, and as such also contributes to enhanced safety and efficiency."

"A tailormade roll-damping system will provide roll reduction up to 75 percent, which is very good," notes Farstad.

The hull shape is designed for minimal speed reduction in seastates, which is of great importance in the areas these vessels will be trading.

The UT 751E is designed with a diesel electric propulsion system.

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