Operations - Sell

Where a cargo is salvaged under contract with the owners, it can be sold in various metals markets through brokers or direct to end-users. Non-ferrous metals do not deteriorate significantly as a result of prolonged exposure to salt water and the recovered metals should be in saleable condition. Some metals are now produced at higher quality levels than in the past and some discount may be applicable to older cargoes. In addition, a discount may apply to cargoes of old or unusual shapes of ingots that differ from present standards.

The Group will consider at some stage employing a professional metals broker who will be responsible for the management of bulk cargo sales. This process usually commences with an agreement between the Company and a buyer for the metals, before the salvage project starts. It is thought by the Directors likely that this will be in the form of a contract stipulating what discount if any should be deducted from the daily metal price as fixed by a recognised exchange, such as the LME. The contract is also likely to detail responsibility for transportation, insurance and third party payments.

In the event that there is no contract in place prior to the salvage operation, the Directors intend that cargoes will be sold into the spot market and all sales will be well planned with every effort being made to achieve the best price available.