Samsung Heavy Industries of Korea said in a regulatory filing on March 6 that it canceled a supply contract of four LNG-FPSOs won for a European owner.
Those cancelled are worth KRW 2.5925trn ($2.385bn), being equivalent to 19.4% of recent annual turnover.
The contract was previously signed on March 10, 2008, however, was called off as of March 5, 2013.
The project cancelled is the one which contract fulfillment has been delayed since the owner had difficulty in securing ship finance or investors amid global economic crisis which occurred right after signing for four LNG-FPSOs in 2008.
Samsung explained that it demanded fulfillment of the contract but the shipowner did not show a will to resume the construction. Accordingly, in line with the terms and conditions of the contract, Samsung notified the owner a cancellation of the contract.
Samsung said that if there is any balance left after spending on the construction out of $495m already been paid from the owner, it is planning to return it excluding compensation cost according to the contract, cash already been spent on pre-engineering, etc.