Riga, 26 January 2005



JSC "Latvijas kuģniecība"                        26.01.2005 



FINANCING OF JCS LATVIJAS KUĢNIECĪBA FLEET RENEWAL PROJECT



With reference to the article by G. Moločkova published in 

the "Kommersant Baltic Daily" on 26 January 2005, JSC "Latvijas 

kuģniecība" (LASCO) hereby informs that since summer 2004 it 

has been holding negotiations with a syndicate of leading 

European banks on the financing of LASCO fleet renewal programme. 

The main terms and conditions of the credit facility have been 

already signed. At present annex documentation (such as pledge 

agreements, schedules, etc.) is being developed, and the terms 

of the credit facility and the Shipbuilding Contracts are being 

coordinated. The Loan Agreement will come into effect upon the 

execution of all the formalities required by the banks.  



As already reported, in order to implement LASCO Group’s 

Strategic Plan 2003-2010 providing for at least USD 350 million 

investments in the Fleet Renewal Programme, 14 tanker newbuilds 

were ordered by LASCO to Croatian and South Korean shipyards in 

2004. The current market value of the vessels ordered already 

exceeds their contractual price by approximately 30%. Besides, 

to preserve JSC Latvijas kuģniecība competitiveness in the 

international shipping market, adversely affected by the Group’s 

ageing fleet and the vessels’ non-compliance with the EU safety 

requirements, three middle range product tankers were purchased 

by LASCO in 2003.



Considering material investment volume, it has been resolved 

that bank loans will cover 70% of the total project costs, 

while 30% will be financed by LASCO Group itself. 





Marita Ozolina-Tumanovska

Head of PR Departament

Phone: +371 7020120, 9287169

Fax: +371 7820239

E-mail : ozolina@lsc.riga