Inger Klemp - Chief Financial Officer and Chief Financial Officer of Frontline Management AS Jens Jensen - Chief Executive Officer of Frontline Management AS

Robert MacKenzie - FBR Capital Markets & Co. Justin Yagerman - Deutsche Bank AG Fotis Giannakoulis - Morgan Stanley Douglas Mavrinac - Jefferies & Company, Inc. Salvatore Vitale - Sterne Agee & Leach Inc. Michael Pak - Clarkson Capital Markets

Good day, and welcome to the Frontline Q1 2011 Results Presentation. For your information, today's conference is being recorded. At this time, I would like to turn the conference over to your host for today, Mr. Jens Martin Jensen, CEO; and Ms. Inger M. Klemp, CFO. Please go ahead.

Good morning, good afternoon, and welcome to our Q1 presentation. We will follow our usual program for this presentation with Inger going through the Q1 highlights and main transactions, financial review of the quarter and thereafter a quick update on our newbuilding program. After that, I will talk about what happened market-wise in Q1 and say a few words on how we see things going forward. So Inger, if you could start please?

Yes. Thanks, Jens, and good morning, and good afternoon, ladies and gentlemen. Moving then to Slide 4 and 5, highlights and transactions. In January 2011, Frontline sold its 2006-built VLCC from Shanghai. The sales proceeds from that sale was $91 million, and after repayment of debt, the sale generated $31.5 million in cash. Front Shanghai, in connection with the sale, agreed to charter back the vessel for 2 years from the new owner, and the duration is 2 years, as I said, and it's $35,000 per day. Delivery to the owners took place in January 26. Company recorded a gain, this quarter, of $7.9 million. And in addition, we will record a gain of $13.8 million over the remaining period of the time charter. Further, in January 2011, Frontline sold all its shares in OSG. The sale generated approximately $46.5 million in cash, and the company recorded loss of $3.3 million in the first quarter. In March, the company exercised its option to acquire the 2002-built VLCC Front Eagle, and then after, sold the vessel to an unrelated third party for $67 million. The company has, in connection with the sale, agreed to charter back the vessel from the new owner. And the duration of this time charter is approximately 2 years at the rate of $32,500 per day. Delivery to the new owners and commencement of the time charter is expected to take place concurrently in the second quarter of 2011. And the company expects to record a gain of approximately $4.2 million in the second quarter and a gain of approximately $13 million over the period of the 2-year time charter period. In February 2011, the company agreed with Ship Finance to terminate the long-term charter parties between the companies for 2 single-hull VLCCs, the Front Highness and the Front Ace. And Ship Finance simultaneously sold these vessels to unrelated third parties. Termination of the charters took place in February and March. Ship Finance made a compensation payment to the company of $5.3 million for the early termination of the charters, which was recorded in the first quarter of 2011. Further in April and May 2011, we agreed with Ship Finance to terminate the long-term charter parties between the companies for the OBO carriers, Front Leader and Front Breaker, respectively. And we expect to record loss of approximately $9.3 million and $8 million, respectively, for the 2 terminations in the second quarter of 2011. Finally, in March 2011, we extended the bareboat charter out contract for the single-hull VLCC Front Lady until August 2013. Then moving to Slide 6, financial highlights. I will again do a quick run through of the financial highlights in the first quarter of 2011. Frontline reports net income of $15.5 million equivalent to earnings per share of $0.20 in the first quarter of 2011. This is an increase compared to the fourth quarter of $27 million, mainly due to gain on sale of assets and other nonoperating items and improved results from operations. The net income includes a gain of $13.2 million, relating to the gain of $7.9 million on the sale of Front Shanghai and a gain of $5.3 million on the termination of the Front Highness and Front Ace charter. The net income also includes the nonoperating gains of $8.1 million, which mainly relates to gain of $8.8 million in Independent Tankers Corporation Limited, arising on the termination of a funding agreement. And then on the amortization of a deferred gain of $3.1 million on the sale of a newbuilding contract, which was partially offset by the loss of $3.3 million on the sale of the company's shares in OSG. The net loss excluding the gains and losses was $6.3 million, equivalent to loss per share of $0.08. And on this basis, we have agreed or decided to have a dividend of $0.10 for this quarter. Then moving to Slide 7. Net income excluding gains is about $4 million, better than in the fourth quarter of 2010. And the increase can mainly be explained by the following items: income on the time charter basis was in line with the fourth quarter compared -- other than due to the fourth quarter. That was due to an increase in time charter equivalent rate per day in the first quarter compared to the fourth quarter. But this was offset by less trading days in this quarter, as a consequence of that the first quarter has fewer days but also due to redelivery of vessels. Ship operating expenses decreased by $2.5 million compared with the preceding quarter, and that was mainly due to decrease in drydocking costs of $3.1 million. Frontline drydocked 2 vessels in the first quarter and 3 vessels in the fourth quarter. Service Charter hire expenses decreased by $1 million in the first quarter compared with the previous quarter, and that was primarily due to redelivery of Desh Ujaala and then also a period of off hire for one vessel on TC due to a drydocking that was offset by charter hire of the Front Shanghai, following the sale and time charter back of that vessel. Finally, depreciation has decreased about $1 million due to the sale of Front Shanghai. Then moving to Slide 8, income on time charter basis. Frontline's double-hull VLCC fleet, excluding the vessels on spot index time charter, earned in the spot market approximately $28,200 per day compared with $23,300 per day in the fourth quarter. Including the vessel from spot index time charter, the vessels -- VLCC fleet earned $27,400 per day for doubles and $19,800 per day for the singles. This gave an average of $27,200 per day on spot earnings. The average for the whole VLCC fleet was about $28,600 per day in the quarter. The Suezmax fleet earned in the Gemini Pool, $17,700 per day in the quarter. And as a consequence of that some of our Suezmax vessels trade outside the pool at somewhat lower TCE rates, we earned on average in the spot market approximately $16,000 per day. And we traded no singles in the quarter. The average for the whole Suezmax fleet was about $17,300 per day in the quarter. The OBOs earned $36,300 per day. And this quarter the TCE numbers show that Frontline has traded better than our peers which have released their numbers. Then moving to Slide 9, ship operating expenses and off-hire. As we can see from the slide, we have average OpEx for the fleet of approximately $10,200 per day in the first quarter compared to approximately $11,000 per day in the fourth quarter 2010. And the decrease is mainly due to a decrease in drydocking cost of $3.1 million in the quarter. We drydocked 2 vessels in the first quarter, which is one less than in the fourth quarter, as you can see from the graph on the upper right-hand side. Off-hire days were 221 in the first quarter compared to 168 days in the fourth quarter 2010. Off-hire days related to drydockings were fewer this quarter, but we had more unscheduled off-hire mainly relating to drydocking of our vessels on commercial management and repairs. We expect to drydock 4 vessels in the second quarter of 2011. Moving then to Slide 10, balance sheet. The total balance sheet is approximately $143 million lower than in the fourth quarter of 2011 -- 2010, sorry. Main items explaining the decrease are: first of all, other current assets were reduced in the first quarter, following the sale of the OSG share; book value of the vessels having -- have decreased, with $121 million following the sale of Front Shanghai; and ordinary depreciation in the quarter. On the liability side, short-term and long-term part of long-term debt is decreased with $91 million, as a consequence of repayment of debt following the sale of Front Shanghai and also ordinary installments in the quarter. Obligations on the capital leases have decreased with $30 million due to ordinary repayments. Other sale is included in the balance sheet with a total of $399 million of debt and obligations on the capital leases. Debts related to 3 of the CalPetro Suezmax vessels are not consolidated in the balance sheet, with $48 million. Moving then to Slide 11, cash cost breakeven rates. The average cash cost breakeven rates for remaining of 2011 are approximately $29,700 per day for VLCCs, $24,700 per day for Suezmaxes and $26,600 per day for the OBOs. These rates are daily rates that our vessels must earn to cover budgeted operating cost, estimated interest expense, scheduled loan principal repayments, bareboat hire and corporate overhead cost. And these cash breakeven rates do not take into account capital expenditures or loan balloon repayments at maturity. Furthermore, vessels on short-term TC-in and vessels on bareboat-out are not included in the cash cost breakeven rates. Then moving to Slide 12 and 13. As per the end of March 2011, the total number of vessels in Frontline's newbuilding program are 2 Suezmax tankers and 5 VLCCs, which constitute a total contractual cost of $658 million. And as per the end of March 2011, installments of $198.5 million have been paid on the newbuildings and remaining installments to be paid for the newbuilding amounts to $451.5 million, with expected payments of approximately $107 million in 2011, $169 million in 2012 and $176 million in 2013, respectively. In November 2010, we secured a pre- and post-delivery financing in the amount of $147 million, representing 70% of the contract price for the first 2 VLCCs to be delivered from Jinhaiwan Shipyard in 2012. For the 3 remaining VLCCs and the 2 Suezmax tanker newbuildings to be delivered between late 2012 and 2013, the company has not yet established pre- and post-delivery financing. But based on the recently secured financing for the 2 VLCCs, we have seen a 70% financing on the market value for these newbuildings. Moving then to Slide 14, capital expenditures. In this graph, we show the installments to be paid under the newbuilding contract in the period 2011 to 2013, with a total of $451.5 million in the light blue column. In the dark blue column, we show the committed financing in the period 2011 to 2013, with a total of $147 million. And in the gray column, we show the assumed uncommitted financing based on 70% of market value of the newbuilding contract in the period 2011 to 2013, with a total of $308 million. The committed and the uncommitted financing is, in total, $455 million. Based on the assumption of 70% financing, Frontline has already made the total equity investment in the newbuilding program, and remaining newbuilding installments will be fully financed with bank debt. However, since we have assumed that the uncommitted financing will not be established until delivery of the vessels, we temporary will use funds from the convertible bond offering during the period until delivery, which is shown in the blue dotted column. Then moving to Slide 15 and 16, Frontline fleet. The number of vessels in the Frontline fleet, as per end of the first quarter 2011, is 76 vessels, including the vessels on commercial management and RTC vessels and is compounded by 44 double-hull VLCCs, 3 single-hull VLCCs, 21 double-hull Suezmaxes and 8 OBOs. We had a contract coverage of 23% in 2011 and 15% in 2012. In addition to this fixed-rate contract coverage, we also have an additional 16% time charter coverage on spot index charters in 2011 and 7% in 2012. The average net time charter rate for the total fleet is about $43,100 per day in 2011 and $47,100 per day in 2012. And with this, I'll leave over to Jens again.

Thank you, Inger. We are now on Slide 17. We continue to outperform our main competitors, as Inger mentioned, which was positive. Otherwise, the first quarter was rather disappointing. Some positive factors to mention a few and in the first quarter was continued slippage to the delivery orderbook of VLCC and Suezmaxes. I'll go into that in more detail afterwards. Year-on-year oil demand was up but actually down quarter-on-quarter. The situation in Libya increased our longer-haul demand from mainly Saudi Arabia and otherwise the negative effect as was as mentioned, we actually saw a drop in oil demand from the first quarter to the fourth quarter. And what I call lost opportunities, that was political unrest, in both Egypt and Libya. And I think if the sentiment had been a bit more positive in the tanker market -- actually, the tanker owners could have managed to push out the market further. Instead, we saw a steep increase in bunker prices, which obviously hurt the bottom line for many tanker owners including that ourselves. The disaster in Japan has had a, so far, a short-term negative effect on the crude demand in Japan. But we can see signs that from the second half of this year, that situation will be positive for the crude demand. And the VLCC fleet on Slide 18. The most positive thing about the orderbook is that no new VLCCs were ordered in the quarter. And the delivery slippage, as we have expected, continued with around 28% slippage of the intended delivery schedule. We expect this slippage situation to continue throughout the year, with no owners being in a hurry to get their ships on the water and delivered. It has now been confirmed as mentioned in the last quarter that 3 VLCC orders has been converted into LNG ships. On Slide 19, the Suezmax fleet. The heavy slippage we have seen to the Suezmax fleet continued, with only 13 ships being delivered which is a 43% slippage. The orderbook is still large, but obviously, the delays would dampen the fleet growth. As mentioned also in the last presentation, we have seen healthy ordering in other segments such as container ships, LNG carriers and offshore rigs that will benefit the tanker newbuilding situation going forward, with much of 2013 and into '14 being occupied by other tonnage types. About newbuilding prices and rates on Slide 20. Newbuilding prices today for a decent specification VLCC or Suezmax is around $100 million and $65 million, respectively. We do not see any reason why newbuilding prices collapse and tankers should fall much from these levels. Positive to note for values, at least, is that 3 VLCCs were transacted at around $105 million each for delivery first half of next year. We get VLCC values for modern ships are keeping steady, while admittedly, values for older ships are under pressure. The 3-year time charter market for VLCCs is around $35,000. And we estimate the rates for Suezmax in 3 years to be around $25,000. There's not that many charters out there to be quite honest. Our little topic for this presentation -- it normally has a different topic. This one is the piracy situation. On Slide 21, I think everybody can see how dramatic the escalation of the incidents of hijackings in 2010 compared to 2008 has happened. And also the area of the operations for the pirates have much widened. Before it used to be just along the coast of Somalia, now it's basically the whole Indian Ocean. Also, the innovative skills of the pirates have increased. Now they're using modern ships for their operations. And furthermore, they're now also attacking ships in ballast, which has a large freeboard. Before they would only attack VLCCs laden. This piracy problem has meant increased costs for the owners, including ourselves. And at best, we can recover 50% of this cost from the respective charters. The other and better solution is to employ armed guards. Positive to note that is no ships with armed guards on board has been hijacked. However, not all charters accept the uses of armed guards. Unfortunately, there's no uniform approach from owners or charters to the piracy situation. And we think this situation will have to change. A little bit about outlook on Page 22. The oil demand is going up, but the fleet growth is outpacing this. However, the gap is somewhat narrowing. We have stopped discussing the single-hull fleet, but we have noticed that more than 1/3 of both the VLCC and Suezmax double-hull fleet is more than 10 years old. The Japanese disaster is expected to have positive crude demand effects in second half of this year onwards. The number of VLCC fixtures are clearly increasing and the fleet overhang is not as dramatic as are seen before. For Frontline, ourselves, we have continued the sales effort of our non-core fleet, which have been the single-hull VLCCs and the charter-free OBOs. The 2 modern VLCCs, Inger mentioned we have sold, seems to be done at the right time and right prices. And we are starting to see more interesting opportunities, so far mainly on the chartering-in side, but we expect that also soon to happen on the asset side. So the big question is when is it time to move? With that, we are ready to take your questions. Thank you.

[Operator Instructions] We will take our first question from Doug Mavrinac of Jefferies. Douglas Mavrinac - Jefferies & Company, Inc.: I just had a few follow-up questions for you guys. And one is in your earnings release, there's a statement that talks about how it's hard to see a recovery in the tanker market as long as the net supply of tonnage grows faster than the total ton-mile demand. My question is how does that view change if we do, in fact, see an increase in ton-mile demand later this year? Whether it's because global oil demand is increasing 2 million barrels a day from 2Q to 3Q or because of Japan or what have you. How does your view change if you do, say, get a 1 million barrel a day increase in OPEC production or 1.5 million in the third or fourth quarter?

Well, if we have, let's say a healthy increase of 1 million to 1.5 million as you mentioned, of course, that would have a quite tremendous positive effect, especially if it's America that will be increasing this extra oil. That seems to be the lagging factor right now, there’s no doubt it seems like the American economy is improving. But we are not seeing the oil demand actually going up in the first quarter. It actually went down in America. So we need the American economy to go on again. And of course, we need continued delays with the orderbook which seems to be the case. And nobody is in a hurry right now to take deliveries. Douglas Mavrinac - Jefferies & Company, Inc.: Got you. And then actually, that leads to my next 2 questions -- is first, obviously, demand in America is weakened, and we saw the IEA reducing U.S. oil demand last week. But my question is underlying the current weak environment, are we still seeing a decent number of West-bound cargoes out of the AG to replace the lost West African exports that are now being diverted to the EU? So are we still seeing -- even though U.S. demand is weak, are we still seeing that shift in trading patterns towards more West-bound cargoes out of the AG that we've seen, say, back in April and early May? Are we still seeing some of that?

We are seeing more movements from Saudi Arabia to the U.S. Gulf. That has definitely happened. But at the same time, we have seen less West Africa cargoes to the States. And we have seen actually quite a change in the trading patterns of VLCCs. Before we saw much more east-west and west-east trading. Now it seems like many VLCCs are just employed in the east and a few VLCCs in the west. We don't have these -- let's say inefficient moves where ships are going longer ballast legs. So we need more activity in the Atlantic basin. Douglas Mavrinac - Jefferies & Company, Inc.: Got you. And then just final question before I turn it over. And it relates to the comments that you made regarding the orderbook. And clearly, the orderbook has proved somewhat fictitious over the last 12 months, given the level of nondeliveries in the form of slippage that we've seen. My question is when you look out at deliveries for the balance of this year and next year, is there any way to know how much of that is deliveries that just aren't going to happen, i.e. they were cancellations that just never showed up, and they weren't taken out of the orderbook. And basically, is there a way to quantify what percent of next year's deliveries were ships that were supposed to be delivered and they just haven't been, versus new orders?

I think, obviously, if the VLCC is $100,000 a day, then everybody will expedite their ships to be delivered. But I -- we predict that the 25% to 30% slippage in VLCCs could continue if the market stays at these levels. And we have various stores going around by actually the owners, with ships supposed to be delivered next year are going to the yards and asking for deferment to 2014 and '15 if the yards can use that space instead. So those discussions are ongoing. Douglas Mavrinac - Jefferies & Company, Inc.: Okay. So it could result in, rather than a peak in deliveries, as was expected in 2010 and 2011, maybe a smoothing in deliveries where there's less deliveries in the near term but perhaps filling -- or backfilling the lack of orders that were otherwise going to take place in 2013, 2014?

That could be a scenario. That could be a scenario. But I think, right now you're seeing more tonnage types being ordered in '13 and '14. And that seems to be popular delivery positions for mainly LNG and container ships right now. Douglas Mavrinac - Jefferies & Company, Inc.: Got you, got you. Okay. Perfect. Great.

We will take our next question from Robert MacKenzie of FBR Capital Markets. Robert MacKenzie - FBR Capital Markets & Co.: I wanted to build on some of the prior questions and tie-in in the comments attributed to Tor Olav yesterday there in Norway, when he commented he didn't see a recovery in the tanker market for, say, 5 years. Yet in your release, and I think it's our view, you talked about 2011 starting to narrow the gap a little bit in terms of the supply-and-demand balance for tankers. Can you talk about some of your underlying assumptions for the economic growth going forward that would lead to that 5-year view before recovery? And I guess, as part of that, future orders for tankers in out-years, if any?

We had the same question this morning, when we did the actual presentation here in Norway before the stock exchange opened. And of course, everybody was also asking us to comment on to our presentation yesterday, which we did not. But I think, some other points in this presentation was probably misunderstood. I think, it's more -- delivering point was not to jump in too early and start investing in the tanker market, if we're going to have a prolonged slump. I think, the most positive sign now in the tanker market is that we actually see more activity. The numbers of fixtures every month is going up. The demand or the number of cargoes is going up. But there is an imbalance in the fleet. And we need more oil demand. We need more things to be done to absorb that. But I don't think some people -- they asked this morning if this is the same as we saw in the mid-'70s and that is absolutely not the same scenario. Robert MacKenzie - FBR Capital Markets & Co.: Okay. And why -- what are the differences there now versus the mid-70s?

Well, in the mid-'70s, I had this exact same question also, I know, and shouldn't have replied it like that. If you look at 1977, there were 600 VLCCs on the water. 50 of them are ULCCs. The oil production per day was 55 million barrels. Today, we have 565 VLCCs, and we have the oil demand of around 90 million barrels. Back in the '70s, you had a very distinct trading pattern for VLCCs. Now we have, of course, with the entry of China coming into the market, a complete different dynamic VLCC market with different traits. So I think it would be quite unfair to compare those 2 scenarios. I know that's a lot of gloom out there, but I think it would be wrong to compare those 2 markets to each other. Robert MacKenzie - FBR Capital Markets & Co.: Okay. And in terms of what you're seeing for incremental loading versus kind of IEA forecast for oil demand growth, it seems to me like pretty much all of the incremental forecasted demand's going to come from regions that have to ship it versus pipe it. Does that seem accurate to you guys as well?

That's correct. Of course, one of the biggest and most interesting areas is, of course, what will happen offshore Brazil, with the huge investments and the various production facilities coming out there, and of course the Chinese oil companies, state oil companies have done over the long-term contracts with Brazilian government or Petrobras. So that will be interesting. It will not go via pipeline, it will be shipped. So in the years to come, and if you look at refinery expansion in China, it looks more positive going forward.

We will take our next question from Fotis Giannakoulis of Morgan Stanley. Fotis Giannakoulis - Morgan Stanley: I would like to follow up on your market outlook and the questions that were previously asked. At this point, how many VLCCs do you think that we are oversupplied in the Arabian Gulf in order to say that if these VLCCs did not exist, we would have a more balanced market with VLCC rates around $40,000, yes?

I will say it's difficult in order [ph] to call. I think, the overhang out of the Persian Gulf for real tradable VLCC, meaning single-hull ships not tradable anymore, is probably between 20 to 25 ships. The overhang is not bigger than that. Fotis Giannakoulis - Morgan Stanley: So would that be correct to say that we are talking about a need for an incremental exports from the Middle East of around 1 million barrels, assuming that this oil goes to Asia? Or you think that demand is going to come from the U.S.? What are the -- what is the incremental quantity of oil that we will need in order to absorb this oversupply and including also the new supply that is coming during the rest of the year?

I think in order to absorb the whole orderbook for the rest of the year, you probably need around 2 million barrels to do that. But of course, it depends on the trade also if it's all U.S.-bound. That will, of course, have the biggest effect. It depends on the -- I would say also in the clustering of the VLCCs. It's probably around that. Fotis Giannakoulis - Morgan Stanley: And on that -- I've been hearing the view that potentially any Saudi export might not go with VLCCs, but there is a good chance that it will go through the Red Sea via the SuMed pipeline towards the Mediterranean market to replace the Libyan production. Do you have a view on that?

I guess that's a pricing issue. That could happen. But I think what we have seen that, that is, of course, increased. But we have also seen more actually VLCCs being shipped -- oil and VLCCs being shipped for the U.S. market also. I don't think it'll be through the pipeline only.

We will take our next question from Justin Yagerman of Deutsche Bank. Justin Yagerman - Deutsche Bank AG: I don't want to harp on these comments from Tor Olav, but when I look at the quotes that came across in the U.S. -- he said we've got to go through a lot of pain before we're back into a profitable territory. And we've just started on a down cycle that will be brutal. So unless there was a mistranslation, it feels as if that there's a really inconsistent message coming here. And if that's the case, and this is actually the view of the senior management, how should we expect you to proceed from a coverage standpoint, from a leverage standpoint and from a dividend standpoint going forward? Are you guys actively seeking coverage, given that he feels the market is in imminent danger?

No. I think, we're quite happy with our coverage position. We prefer to have around 2/3 of our fleet spot. We think they’re fixing out now on the prevailing rates and you're giving away the upside, so we will not do that. The only expense on the coverage would be some of the OBOs coming off charter and maybe single-hull ships will just extend to one, as mentioned in the highlights. No, we will not do that. It's difficult to comment on the specifics in his opinion but that's -- that has much speculation on that. I can't really say more than that. Justin Yagerman - Deutsche Bank AG: Okay. And then the intentions, I guess, for the newbuilding program, given your market outlook. I mean, are these ships that you're continuing to plan to take delivery of, or would you be looking to sell them if you had attractive prices in the market?

Well, we have the VLCCs more than 105 and the Suezmaxes are very low 60s, which is our market prices. We need fleet renewals, so our intention is to take delivery of these ships. We have only financed 2 of them, but we have received indications of up to 70% finance of the rest. So we're quite comfortable with the orderbook. Justin Yagerman - Deutsche Bank AG: Yes. With the stock down, I mean -- and double digits on a percent basis over the last 2 days just on this commentary. Any interest in buying shares here in the market, given what's going on, and given that your stock is trading at a discount?

That's an opportunity for us as well, along with all the acquisition opportunities, so we have to review that. Justin Yagerman - Deutsche Bank AG: Okay. I mean, given the commentary, it feels like if you guys aren't buyers, then to some extent, you might be sellers. I just -- curious how you feel about the market right now in more certain terms.

Well, I think we see more activity in the tanker market but that’s more -- I think the most important thing is the activity. The number of cargoes has moved up, and there is imbalance in the fleet. But I – what we haven’t -- the rates obtained in the first quarter were not fantastic, but at least you can tolerate that on a shorter term. There is some signs, mainly on the activity side, which is picking up, which I think is what we have to focus on right now. Justin Yagerman - Deutsche Bank AG: Okay. And the last question, and I'll turn it over to somebody else. On the bank debt side, you're actively -- it sounds like talking about the newbuilding financings. You guys are targeting 70% advance rates. Are those achievable right now? And at what kind of margins are you looking at financings right now?

I definitely think that is achievable right now. Yes, definitely. And the margins, I guess, you can get in the market now is around, let's say, 200 basis points up to 250 basis points, I guess, depending upon the transaction. Justin Yagerman - Deutsche Bank AG: So that's come in from a height of 300. I mean, is it safe to assume then that the banks are viewing a better market in terms of credit quality?

It seems like the banks are quite interested in doing business nowadays, yes, but the competition, I guess, is better than it was before. Justin Yagerman - Deutsche Bank AG: Okay. Appreciate it.

We will take our next question from Michael Pak of Clarkson Capital Markets. Michael Pak - Clarkson Capital Markets: A couple of quick questions here. On your press release and your commentary, you guys have indicated that you could -- you're actively evaluating a portfolio for future potential vessel sale. Given your book values of the vessels, how do you reconcile that with the prevailing market values and your eagerness to perhaps drive that? If you can help explain that, that would be helpful.

Well, I think that what we mentioned in the press release that we don't necessarily have to maintain the biggest crude oil tank owner. We don't want mind selling 1 or 2 ships if the price is right, which we feel that the Front Shanghai and the Front Eagle was. We will not start selling the core fleet at a loss. I think, there's probably more interesting buying opportunities coming than to start selling at a loss. Michael Pak - Clarkson Capital Markets: Okay. And just expanding upon your future debt raising for the newbuild program, are you understanding that you have some time to get this done? The deliveries don't take place until late next year. Are you still concerned that -- or is there a thought that the bank market could turn against or get worse as the tanker market’s going through, as we go through the year? And is there a thought that maybe securing these things ahead of time may be a more prudent move? I’d just like to get your thoughts on sort of the downside scenario.

I don't think we are concerned about that. I think, what is important is that you are -- among the banks, that they prioritize the clients, the ones that they would like to do business with. And I think we have always looked upon our banks as very supportive to ourselves and to the Fredriksen group. So I don't think we are concerned about that. Michael Pak - Clarkson Capital Markets: Okay. Are you confident that you could secure whether it be covenants in terms that are sort of similar to your existing debt structure that you have in place?

Yes, we are. That's our time and attention. Michael Pak - Clarkson Capital Markets: Okay. And then one last question. Can you give us a sense of your utilization rates in 1Q? I understand you took some unscheduled off-hires? Can you give us some color, or percentage change on the trading days would be helpful.

Well, we've mentioned before, we don't mind waiting for the right cargo. In a low market waiting time is basically free. So we think it's more important to find the right cargoes and the right charters when we know that we want a certain destination. It could be East-West or vice versa. So we have normally been -- in a low market we're willing to take waiting time. And we have done that also in the first quarter, so of course off-hire days is off-hire days that's regarding dockings and repair and so on. But waiting days, we also have that like we had in the other quarters. And normally in a low market, we would take more waiting days. Michael Pak - Clarkson Capital Markets: Okay. So is it fair to say that 1Q had a lower utilization than 4Q and year-over-year?

I think, throughout the tanker fleet right now, you have a lower utilization, you have waiting time which owners take and then, of course, also, you have the ultra low slow speed. So I guess, yes, you can say, the whole utilization of the fleet is lower.

[Operator Instructions] We will take the next question from Sal Vitale of Sterne Agee. Salvatore Vitale - Sterne Agee & Leach Inc.: Just a clarification on your comment earlier about your target coverage ratio. I think you said it was about 2/3. So just looking at Page 16 of the presentation, where for the rest of 2011 you had 23% and then 15% for 2012. So just I guess, first -- I'm sorry, first, on 2011, if you don't see attractive rate levels on the time charter market, at some point, do you fix anyway just to get close to that 20% -- to that 33%, that 1/3 level, or do you just play a more opportunistic approach and maintain low contract coverage?

What we have mentioned here is, and also Inger mentioned, is the fixed time charter coverage. And apart from that, in 2011, we actually have time charter coverage up to 39% of the fleet. The rest, 15%, is basically VLCCs, Suezmaxes on time charter but the rate is market-related. In 2012, it's around 25% of the fleet we have tied up in complete charter. We think our -- -- like I mentioned before, we should have 1/3 -- around 1/3 out on charter and then 2/3 spot. You could say that we should add a little bit more in 2012. But we will not do it now at these rates and we prefer to wait. But we'll be quite happy with our portfolio of charter right now. Salvatore Vitale - Sterne Agee & Leach Inc.: Okay. And then just final question. Looking at European oil stocks, at what point do you think you'll start to see a rebuilding in that? I mean, I think it's overdue at this point. Do you think you'll start to see some rebuilding in European oil stocks in June and into the summer?

I guess, everybody's looking at the oil price and the commodity price and when is the right time to do that. I can't say, but I think the -- of course the European economy or at least in the big countries, such as Germany, seems to be quite healthy. So I don't know what their plans are but -- I guess, it could happen, but it must be related to the oil price and, of course, I guess, the strength of the U.S. dollar as well. Salvatore Vitale - Sterne Agee & Leach Inc.: Okay. And then just the last question on the use of capital side. Just following up on a question that was asked earlier about the potential, given where the stock is now, the potential for stock repurchases. Is there a level -- is there a stock price level where you think that it would be a better use of capital than continuing to pay out dividends? Just thinking ahead to if the tanker margin continues to remain weak, might that be a use of capital?

So far, I think, that our philosophy, in a way, had been to pay dividends with the excess cash flow that we have instead of buying back shares. So I don't -- we haven't really discussed this item on a detailed basis at all. So I think it's hard to answer that question.

[Operator Instructions] We currently have no more questions in the queue at this time.

All right. I'd like to say thank you to everybody for dialing in and listening to our presentation. And I will thank everybody in the company for their hard and good work in the first quarter. Thank you very much. Thank you.

That will conclude today's conference call. Thank you for your participation. Ladies and gentlemen, you may now disconnect.