PRESS: Daewoo refuses to build vessels for Arctic LNG-2

MOSCOW, May 25 (PRIME) -- South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME) has broken a contract with Russian shipping company Sovcomflot on construction of three liquefied natural gas (LNG) Arc7 tankers on overdue payment, Kommersant business daily reported on Wednesday.

On May 17, DSME disclosed the materials without naming the ordering party, but said that it was a European company. According to sources of TradeWinds newspaper, DSME meant tankers for Arctic LNG-2.

“In light of the fact that the payment of the vessel owner for construction of one of the LNG tankers has not been sent in proper time, we have notified the company of termination of the contract to protect our rights,” DSME said.

The U.S. $872 million deal was signed in 2020. The shipbuilder was to commission the three vessels in February, April and June 2023.

The newspaper reported that Sovcomflot could have failed to pay for the order due to payment processing problems over the U.S., the E.U. and the U.K. sanctions.

Sovcomflot declined to comment on the details of a commercial contract. The owner of Arctic LNG-2 Russian independent gas producer Novatek has not responded to the newspaper’s request.

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