Quintana Maritime to Purchase Capesize Newbuildings

Quintana Maritime Limited to purchase two 181,000 deadweight-ton (dwt) Capesize vessels. The vessels are being built at STX Shipbuilding Co., Ltd., a major South Korean shipyard, with delivery expected in the fourth quarter of 2010. The expected total cost at delivery of the two vessels, including contract costs and financing costs, will be approximately $159m. Quintana expects to nominate shipowning companies in which it will own a 50 percent interest to purchase the vessels. The company is in the process of negotiating the terms of the agreements governing the joint ventures. The company will pay approximately $16m, $4m and $60m in 2007, 2008 and 2010, respectively, and will control 50% of the shipowning companies. The Company will collect, from April 16, 2007 until the delivery of the vessel, $60,000 per annum per ship from the other members of the joint ventures as management fees for supervising the construction of the vessels. Upon delivery, the Company will manage the ships on behalf of the joint venture, and the shipowning companies will pay QMAR a management fee based on the Company's budgeted management costs, subject to adjustment in certain circumstances. The company has secured five-year charters from the vessels' delivery in the fourth quarter of 2010 at a net daily average floor rate of approximately $27,000, with 50% profit sharing above the floor rate (based on the monthly AV4 BCI average, as published by the Baltic Exchange) with EDF Trading, a wholly owned subsidiary of EDF, one of the largest utility companies in Europe.