Published November 3, 2008

Cosco missing some money from Russia

By VINCENT WEE

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COSCO Corp Singapore's Cosco (Zhoushan) Shipyard unit yesterday announced that it is owed US$12.4 million by the owner of three Russian-owned fish processing vessels that it undertook repair works for.

The repairs were carried out from August 2007 to October this year. After completion of the work, a sea trial was carried out on Oct 20. However, the crew unexpectedly changed the vessels' course and did not return to their original point on the following afternoon. To compound the situation, 15 Cosco shipyard workers were on board at the time.

However, with the assistance of the Chinese government, the 15 workers returned safely to Cosco Shipyard yesterday. Only US$3.8 million of the US$16.2 million total contractual price for the repair has been paid.

Cosco Shipyard has demanded payment of the outstanding sum in line with the terms of the contract with the owner of the vessels. It is unclear if Cosco has possession of the vessels.

The outstanding sum is not expected to have a material impact on Cosco's net tangible assets and earnings per share for the year ending Dec 31, 2008, the company said.

Cosco shares closed two cents higher at 77.5 cents last Friday.