With  reference  to the article in the February 17, 2004 edition of the

Kommersant  Baltic  Daily  ,  JSC Latvian Shipping Company (LSC) hereby

informs  that  the  Memorandum of Agreement (MOA) on the acquisition of

three modern second-hand handy-max tankers has not yet been signed. The

MOA  between  Crown Navigation Inc. (a wholly owned subsidiary of LSC )

and  Andromeda  or its nominated company is planned to be signed within

the next few days.

The  information  published  by  the  Kommersant  Baltic Daily has been

submitted  to  the  Financial  and  Capital  Market  Commission  by LSC

pursuant  to  the  Law  on the Financial Instruments Market, and should

have remained confidential till the MOA is signed.

Based on the targets set out in LSC Group's Strategic Plan 2003-2010, a

detailed  analysis  of  the  potential  shipbuilding contracts (prices,

delivery   dates,  etc.)  and  thorough  investigation  of  acquisition

possibilities  in  the  new-building  resale and second-hand market has

been  made  by  the  company's  experts  in  cooperation with reputable

shipping consultants.

According to the results of the inspection of m/t Pink Star , m/t Coral

Star  and  m/t  Purple Star their specification and technical condition

fully  meet  the  requirements  of  LSC  .  All three 37-deadweight-ton

tankers  are  built  to  ice  class  and  designed  to  carry light oil

products.  The  vessels  are  planned to run mostly in Northern Europe,

although the possibility of their employment in other regions cannot be

excluded.

"Already  seven  LSC  Group's  tankers  have been sold for scrap due to

economic  reasons since 2002. To comply with MARPOL and EU requirements

another  six  Pablo  Neruda  type  tankers will have been phased out by

2006.  To  avoid  a  drastic  reduction  of LSC fleet and to retain the

Company's  competitiveness  in  the handy-size tanker segment, the most

attractive  alternative  to  ordering  new-buildings  was  to  accept a

proposal to purchase three modern vessels from Andromeda in Monte Carlo

with the delivery in May-June 2004", said Alvis Akmens, Director of LSC

Tanker Fleet Department.

LSC  Supervisory  Council's  consent  to  the  purchase of three modern

second-hand tankers at the best possible contractual terms was given on

13 February 2004.

Marita Ozolina-Tumanovska

Head of PR Departament

Phone: +371 7020120, 9287169

Fax: +371 7820239

E-mail : ozolina@lsc.riga