ERRA A/S announced that it has canceled the last newbuilding contract with Rushan Shipyard Co. Ltd, as a part of the company’s reconstruction policy.

Previously, Erra A/S concluded contracts for delivery of three new chemical tankers with the Chinese shipyard Rushan Shipyard Co. Ltd. in Rushan. The construction contract for the first newbuild vessel was canceled in 2009 and the second in December 2011. With this third cancellation of the vessel under construction, that was supposed to be delivered in May 2012, Rushan Shipyard Co. Ltd. could expand the current or initiate a new arbitration against Erria A / S.

The shipyard started arbitration against Erria A / S in London to resolve the legality of the cancellation of newbuilding contracts. Erria A / S has together with Danish Bank (as assignee of Erria A / S’s rights under the construction contract) raised a counterclaim against the shipyard for repayment of the Group’s prepaid installments paid during the construction contract.

Until today, the parties exchanged charges, defenses and rejoinders.