Nautilus Minerals Inc. said Dec. 11 that Fujian Mawei Shipbuilding Ltd. issued a default notice alleging that MAC Goliath Pte Ltd. failed to pay the third installment of the contract price in the amount of about US$18 million plus interest.
Fujian is the owner of the shipyard where Nautilus' production support vessel is being built, while MAC is buying the vessel.
Under the shipbuilding contract between the shipyard and MAC, MAC is required to rectify the default immediately. Its failure to do so within 21 days of the notice may result in the termination of the contract.
If the contract is terminated, Fujian Mawei has the right to sell the vessel to another party.
Meanwhile, the company's Nautilus Minerals Singapore Pte. Ltd. unit has the option to either remedy the default on behalf of MAC and/or replace MAC as a party to the contract.
Nautilus noted that the vessel is progressing well with construction over 70% complete.
The company is advancing development at its Solwara 1 copper-gold-silver property, off the coast of Papua New Guinea.