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Marine Log

March 17, 2008

Algoma Central buys three from Viken

Canada's Algoma Central Corporation has entered into an agreement through a wholly-owned subsidiary to purchase three ocean-going handy-sized bulk carriers from Viken Shipping AS, of Bergen, Norway for a total cost of approximately $38 million.

The three sister ships were built at 3 Maj Rijeka Croatia, one (Sandviken) in 1986 and the others (Daviken and Goviken) in 1987. These 222. 2 m maximum St. Lawrence Seaway size vessels each are fitted with four cranes and have a carrying capacity of 34,000 tonnes. They are currently operating under long-term time charter agreements with Fednav International Ltd. that Algoma will assume.

Algoma calls the acquisition an "excellent fit" with its established and recently announced ocean shipping activities and says it is pleased to be able to assume charters with Fednav, an established leader in ocean dry-bulk shipping.

Algoma says the acquisition also has the potential to provide a competitive fleet renewal option for the Seaway Marine Transport (SMT) gearless bulk carrier fleet. SMT is a partnership between Algoma Central and an unrelated party (Upper Lakes Shipping) and it operates and manages the largest fleet of dry bulk cargo vessels operating on the Great Lakes and St. Lawrence Seaway.

On the expiry of the existing Fednav commitments, Algoma intends to make the three vessels it is acquiring from Viken, available for use by SMT in Canadian-flag service This decision will be based on market conditions at the time.

Algoma Central owns two ocean-going self-unloaders through a wholly-owned foreign subsidiary and an interest in five ocean-going self unloaders through a joint venture. These seven vessels are part of a 29 vessel, ocean-going, self-unloader fleet that is commercially managed by CSL International.

Last November, Algoma Central announced an order for the construction of five IMO II product tankers in China to be delivered in late 2010 and early 2011. On delivery, they will be employed and operated in the Hanseatic Tankers joint venture. Hanseatic Tankers plans to employ and operate 24 similar product tankers with the expected trading areas to be focused in Europe, the Mediterranean, the Middle East and Asia. Algoma Central also owns a 1998 built foreign-flag product tanker through a wholly-owned foreign subsidiary. It is expected this vessel, the Amalienborg, will also be employed and operated as part of Hanseatic Tankers commencing in late 2008.

Algoma Central owns and manages four Canadian-flag product tankers with delivery of an additional two product tankers, the Algonova and AlgoCanada, scheduled for the second half of 2008. In addition to ocean shipping and product tankers the Corporation owns 19 Canadian flag dry-bulk vessels that operate on the Great Lakes--St. Lawrence Waterway as part of the SMT fleet.

As previously announced, the SMT partners have entered into agreements to construct two maximum seaway size self-unloading forebodies which will be attached to the refurbished and upgraded aft-ends of the Algobay and Algoport. The corporation also provides diversified ship repair, diesel engine repair services and fabrication services to shipowners and industrial customers throughout the Great Lakes-- St. Lawrence Waterway



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