Fortescue settles shipping dispute

Fortescue Metals has settled its outstanding shipping dispute with Splendour Special Maritime Enterprise.

Fortescue Metals has settled its outstanding shipping dispute with Splendour Special Maritime Enterprise, the company announced last Friday.

Splendour Special Maritime Enterprise, which is part of the Angelicoussis Shipping Group (ASG), will now discontinue its legal proceedings against Fortescue.

Under the terms of the settlement, Fortescue will pay ASG US$5.25 million and has also agreed to restructure future cargo obligations.

In addition, the freight rate under the restructured charter arrangement has been set at a base daily rate which, according to Fortescue, is slightly under the current market rate, plus a hire incentive payment of an additional 50% on the base rate.

Fortescue has been involved in disputes with multiple shipping companies after terminating long-term charters of 10 iron ore vessels in December last year after a slump in iron ore demand.

The deal with Splendour Special Maritime Enterprise represents the third successful settlement, with three outstanding disputes remaining.

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