Hereby  JSC  Latvian  Shipping  Company  (LSC) informs that in order to

enable  investments  in  new  and  more  competitive  ice-class product

tankers,  on  5  December 2003 LSC Supervisory Council approved sale of

three  LSC Group's Panamax tankers. Together with the Sales Contract an

agreement  will  be signed with the potential buyers on delivery of the

three  vessels to time charter back to Latvian Shipping Company for the

period of five years.



Three  Panamax  product  tankers  -  Rīga  , Zemgale and Latgale - were

bought  in  2001  at  an  especially high price of USD 42 million each.

Already  in  2002 the valuation by the independent professional valuers

revealed  a considerable difference between the vessels' net book value

and their market value. Therefore the decision was made to recognize an

impairment  loss  of  USD 18 million, which was the main reason for the

Group's negative result in 2002.



According  to  the  report  made  by LSC work group in cooperation with

reputable  shipping  consultants  the deadweight of the above-mentioned

vessels  is  considerably  lower  than  that of modern Panamax tankers.

Therefore  difficulties  related  to  their further employment might be

expected.  Besides,  the  two-year operation of the vessels in question

discovered  the  inability  of  their  technical  parameters  to ensure

long-term profitability of the vessels' employment.



Due  to  favourable situation prevailing in the second-hand market, LSC

received  a  number  of  beneficial  offers  to buy the Group's Panamax

product  tankers  at  the  price  exceeding  their  market valuation by

independent  professional valuers. Pursuant to the terms and conditions

of  the  Sales  Contract, by signing Time Charter Agreement JSC Latvian

Shipping  Company will further operate the three tankers for the next 5

years. The period is fully sufficient for the new product tankers to be

ordered and delivered.



The  interest  shown by the buyers in the three tankers is explained by

favourable   taxation   policy   in  a  number  of  European  countries

encouraging investments in the shipping industry.



"By  using  favourable  market  situation  and  selling Panamax product

tankers  at  the  best  possible  price,  LSC will be able to order new

ice-class   tankers   meeting  the  latest  market  requirements,  thus

implementing  the  fleet  renewal programme provided for in LSC Group's

Strategic Plan", stressed Imants Vikmanis, LSC president.



 For additional information:



Marita Ozolina-Tumanovska



Head of PR Departament



Phone: +371 7020120, 9287169



Fax: +371 7820239



E-mail : ozolina@lsc.riga