Exmar Profits from LPG, LNG

During the first six months the LPG fleet contributed $19.7 million to the operating result (EBIT) (compared to $12.3 million for the first six months in 2004). This result was positively influenced by a profit of $4.7 million realized on the sale of the 50% participation of EXMAR in the LADY KIRA (5,000 m³/1994) and in the BIRGIT KOSAN (5,000 m³/1999).

The Midsize, Ethylene and Pressurized segments contributed as budgeted and Time-Charter levels reflected a firm market sentiment. The VLGC fleet however did not meet expectations particularly due to persistent uncertainty on LPG pricing related to crude oil fluctuations and reduced product availability ex Arabian Gulf. In the course of the first semester, EXMAR purchased the LPG/C BRUSSELS (ex Oxfordshire, 35,000m³/1997) and concluded a newbuilding contract for 2 VLGC’s (having each a capacity of 84,000 m³). These vessels will be delivered in the fourth quarter 2007/first quarter 2008.

In April, an agreement was reached with Eitzen of Denmark to relet the three LPG/Ethylene POLAR vessels (10,500 m³ / ‘90-built) at a rewarding margin.

LNG

The LNG sector contributed $19.6 million to the operating result (EBIT) over the first six months of the current year (compared to $12.2 million for the same period in 2004).

The shortage of product reported the first quarter continued trough the first half of the year, as a result of which the surplus of tonnage remained. In this market conditions, EXCALIBUR, idle since November under the Golar/EXMAR joint venture, was fixed for short-term employment with Shell in June. A further six week’s employment has been secured in direct continuation with Distrigas of Belgium. EXCEL continues on the time charter to the Sultanate of Oman.

At the end of June the LNG tanker METHANIA (131,325 m³/1978) was sold to Distrigas pursuant to a new cooperation agreement. EXMAR realises on this sale a capital gain of USD 13 million.

EXMAR’s ship management company TECTO will continue the technical management and manning of the ship until 2014.

EXCELSIOR, the first LNGRV was delivered in January and was immediately time-chartered to Excelerate Energy for a period of 20 years.

On her maiden trip, February/March, EXCELSIOR completed with success her first regasification operation out of the Louisiana coast throughout Excelerate’s Gulf Gateway.

Meanwhile, the second LNGRV (EXCELLENCE) was delivered. Technical management and manning will be undertaken by TECTO.

The delivery of the EXCELERATE is expected in November 2006. As previously announced, EXMAR concluded a long-term charter party with Excelerate Energy, for a further LNGRV with a capacity of 150,900 m³. The vessel, named EXPLORER, is a 80%/20% joint venture with Excelerate Energy.

Prospects for the balance of 2005 indicate a continuing overhang of ships in the spot market and, therefore, results for the EXCALIBUR will depend upon the employment of the ships in the joint venture with Golar LNG.