Fujian Shipbuilding Terminates Nautilus’ Vessel Construction Contract
Fujian Mawei Shipbuilding has canceled the construction contract for the Nautilus Minerals’ Production Support Vessel, a part of the Nautilus’ Solwara 1 project located offshore Papua New Guinea.
The contract was terminated due to MAC Goliath’s failure to pay the third installment of the contract price. MAC was hired by Nautilus to procure the construction of the PSV on behalf of the company, but it failed to pay the third installment of approximately USD 18M + interest.
Prior to the rescission of the contract the Shipyard notified Nautilus about the MAC’s default, in December 2017.
According to Nautilus’ December notice, in case of the contract termination, the Shipyard has the right to either complete or not complete the vessel and to sell it by private sale either in a complete or incomplete state.
In accordance with the terms of the contract, Nautilus Minerals Singapore has the option to either remedy the default on behalf of MAC and/or replace MAC as a party to the contract by way of a novation or assignment.
“Notwithstanding the rescission of the shipbuilding contract by the Shipyard, discussions are continuing and the company will issue further updates as matters develop,” Nautilus said.