Good day and welcome to the Q2 2014 Frontline Limited Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Jens Martin Jensen. Please go ahead, sir.

Thank you. Good morning and good afternoon to everybody and welcome to our second quarter 2014 presentation. We will follow our usual program for the presentation with Inger going through the highlights of the second quarter thereafter financial review of the quarter and after that, I will follow-up with some market comments and give some comments of the present market and our own situation. So Inger, if you could start, please?

Thank you and good morning and good afternoon, ladies and gentlemen. And I want to review slide 4 of the presentation, highlights and transactions. Frontline took delivery of the Suezmax newbuilding, Front Ull, in May 2014. Frontline entered into a 60 million of term loan facility in June 2014 in order to part finance its two newbuildings Suezmaxes. And I think it was June on the facility in June 2014. Frontline has issued 2,865,511 new shares under the ATM program in the second quarter and further (inaudible) new shares in July. Frontline agreed with Ship Finance in July 2014 to terminate the long term charter parties for the 1999 built VLCCs Front Opalia , Front Comanche and Front Commerce and Ship Finance simultaneously sold the vessels to unrelated third parties. We expect the charter parties to be terminated in the fourth quarter of 2014. Moving down to slide five financial highlights and slide six, income statement. Frontline reports a net loss of $78 million equivalent to a loss per share of $0.81 in the second quarter 2014. This compares with a net loss of 12.1 million and the loss per share of $0.13 for the preceding quarter. The net loss attributable to the company in the second quarter includes an impairment loss of 56.2 million relating to the vacancies Front Opalia, Front Commerce and Front Comanche and a gain on the process and minority interest of 8.2 million. Net income, exchanges and losses in the second quarter was 38.2 million compared with a (inaudible) results in the first quarter. The decrease in the sales (inaudible) in the second quarter compared to the first quarter is mainly explained by a decrease in the time charter equivalent rate in the second quarter compared to the first quarter, which lead to a decrease…

Thank you, Inger. We are now on slide 13. A disappointing quarter I think is the best way to describe it. With reduced crude demand in the Asian markets mainly due to refinery overhauls shifted the market balance back in the charterers’ favor. The third quarter has come off to a good start and we hope the market will give us further strength as we head into the autumn and winter season. Now we've slide 14 the VLCC fleet, as we have mentioned before, more scrapping is needed to sustain this order book but we saw a fairly balanced fleet development in the quarter which is positive. Slide 15, the Suezmax fleet, we actually saw a negative fleet growth which -- negative fleet development in the Suezmax segment in the second quarter and the limited order book makes this segment interesting. Newbuilding prices and time charter rate on slide 16. Newbuilding prices has flattened out and we estimate depending on the specific and the final specification that newbuilding prices for VLCCs should be in the region of 96 million to 97 million and for Suezmax around 65 million to 67 million. Recently the time charter activity for VLCCs and Suezmax has increased mainly for periods up to 12 months, but in general terms the rates and owners optimism has increased and estimated rates for three year time charter periods for VLCC is now in the low to mid 30,000s and around 25,000 for Suezmax tanker. A positive trend is under development. If you now go to slide 17, outlook the market for the first six months of the year has been volatile, but improved compared to 2013. The second half of 2014 is looking more interesting and with the increased ton-mile situation on both VLCC and Suezmax segments and the order fleet development, this market could very well tighten further. The low points in the chartering markets could be avoided with better chartering qualities by the owner ship base is very fragmented, so it's not that easy. Regarding ourself, despite the improved tanker market, we have seen so far in the third quarter which could very well continue into and over the winter market. We are still facing with a very challenging situation when it comes to our debt situation. We and our Board are proactively working on this and we are considering various alternatives such as raising further equity and potential asset sale. A full restructuring of the company is also being considered. With that, we're now ready to take your questions. Thank you.

Daniel, we can take questions now.

Thank you, sir. (Operator Instructions). We can now take our first question. It comes from Jon Chappell of Evercore. Your line is open, sir. Please go ahead.

Thanks, operator. Good afternoon guys.

Hi.

Good afternoon.

A couple of clarification questions from the fleet development. So first of all, with ITC and their bankruptcy, you mentioned you're going to deconsolidate the Windsor Group from the financials in the third quarter, is that just the vessels associated with those bonds or is that the entirety of ITC that you're going to deconsolidate from Frontline's financials?

Those are the vessels which are related to the Windsor Group.

Okay. And you expect them to come out, you said in November or emerge from bankruptcy in November, would you reconsolidate everything then starting in the middle of the fourth quarter?

We will deconsolidate from the third quarter as we state in the press release.

You will deconsolidate in the third quarter but once they emerge then you reconsolidate them or they completely deconsolidated [from it]?

I didn’t get what you meant now.

You are deconsolidating them so you are taking those out of your financials, but once it emerges from bankruptcy, do you ever put them back into your financials or are they permanently deconsolidated?

No I assume they will be permanently deconsolidated, yes.

Okay. And then on the Chevron vessels as well, can you just explain the financial impact of that what’s the amount of the outstanding term Notes?

I don’t think we can - I think it’s too early to say that, I think we can probably have that in the separate column yes.

Okay. The last thing that I wanted to talk about was the options set before you, you have talked about equity you are selling assets are complete restructuring and then if you read the Frontline 2012 press release they talk about several structural alternatives, as you look at the alternatives for Frontline Limited is there something that can be done with the Frontline 2012 or does it need to be completely independent of that relationship?

There is alternatives we are looking at. And I can’t really give you any specifics there right now.

Okay. And then finally just on the asset sales, is there a market for some of the older ships or would the assets sales have to include the two new-built Suezmaxes?

It could be the two, it would be the most natural thing would be the two Suezmaxes, but there could be some other things on the fleet but the most natural thing will be those two Suezmaxes, yes.

Okay, thanks for your help Jens, thanks Inger.

Thank you.

Thank you.

Thank you, sir. We can now take our next question; it comes from [Vlad Jelisavcic from Bowery Investments]. Your line is open. Please go ahead.

Good afternoon. Few questions here, you mentioned that you took out a new $60 million term loan secured by the two Suezmaxes. Could you have borrowed more; I mean why was it limited to just $60 million number?

Well, I think it still is a kind of profitable amount of debt related to Suezmax. So, I guess that's more in line where with the market is now.

So, 60 secured by both new builds, correct?

30 million.

30 million each vessel then. So basically I guess, if you say that the market value is around 60 whatever then it’s 60% financing.

Right, okay. And the first Suezmax that was delivered in May, is it working, is it on charter currently?

It’s in the spot market, yes, it's just…

It’s in the spot, okay. And then just a question going back to the remaining commitments. So, you paid $41 million cash in the second quarter for the delivery of the first new vessel that was delivered May 19th, and then you gave another $41 million commitment to the second delivery in September?

That's correct, it’s going to be later than September, but that's correct.

The fourth quarter is what we are expecting now.

Yes.

Understood, okay. Thank you.

Thank you.

Thank you, sir. We can now take our next question. It comes from Erik Stavseth of Arctic Securities. Please go ahead sir. Your line is open.

Hi guys. One quick question from me, it refers to the Ship Finance notes that you have taken on for the past two quarters. Are those notes senior to the convertible or whether that place in -- what’s the place in the capital structure?

Same, equal.

Is that equal to the [CD]?

Yes.

Okay. Thank you.

Thank you.

We have no further questions at present. (Operator Instructions). Thank you. We have a number of more questions now. The next question comes from John Reardon at Merriman Capital. Please go ahead sir.

Good afternoon. Does Frontline still have their shareholding in Frontline 2012?

Yes.

Yes.

And is that approximate value still around $70 million?

No, it’s higher. It’s more than that, around $90 million.

Okay. So, that could be one of the options to access some cash going forward, is that correct?

That’s correct.

One of the alternatives, yes.

Okay. Thank you.

Thank you.

Thank you.

Our next question comes from [Galia Velim of GLG]. Please go ahead.

Hi, thank you very much for taking time to have this call and answer our questions. Just could you elaborate a little bit more on the different options in financing of convertible bond and your timing sort of when do you think you can decide that you need to engage with the bondholders rather avenues to this, become impossible?

I think it's a bit pre-mature to comment more on that now. I think we'll get back to that when we have complete detail in that respect.

And when will be that?

As I said, we're really (inaudible) when we have something to tell.

And you cannot make any comments on different options you're exploring and how far you are in terms of reaching some kind of financing?

It depends on the overall solution, we go for and then that will be communicated when that is ready.

Okay.

Thank you.

Thank you. We now have a follow-up question from [Vlad Jelisavcic] of Bowery Investments. Go ahead there sir.

Thanks, just one follow-up. The notes that will be issued as a result of the lease unwind we obtained that the 10 million cash damages and then issuing a note, will that also have the same priority as the convert?

Yes, we just answered that question. So…

Okay. What show whether related to the same note.

Yes.

Okay, okay. And then just one other follow-up that I didn't really understand, but there is an asset that you have in your balance sheet investment in finance lease, I believe in the March quarter this carried about 48 million, can you describe what that is?

It's a vessel which I say on the [charter], so that's the way you record it.

Oh, it's a single vessel?

Yes.

Yeah. It's one a vessel.

Okay. It's a one vessel and the equity is owned by Frontline.

That's right.

That's correct.

Okay. But as subject to a long term lease?

That is also correct.

Yes.

Okay. Thank you for that clarification.

Thank you.

Thank you.

(Operator Instructions). At the moment, we have no further questions. Thank you.

Okay. I would like to say thank you to everybody for dialing in and listening to our presentation. And I would like to thank everybody in Frontline for the work and efforts. Thank you very much. Thank you.

That does conclude the conference call. Thank you for participation. Ladies and gentlemen, you may now disconnect.