Agreement/ Mandatory notification


Frontline Ltd. (FRO: NYSE, OSE, LSE) has today established a facility with The Bank of Nova Scotia Group (“Scotia”). The facility is termed a Stock Indexed Total Return Swap Programme, more commonly known as an Equity Swap Line.

The Programme secures that Scotia may acquire up to 3,500,000 Frontline shares over the next 12 months. Financially the Programme is structured so that Scotia has a right to put the shares to Frontline at cost, and Scotia will also receive compensation equal to carrying cost plus a margin. Frontline will be exposed to fluctuations in its share price, and will have a right to call the shares at any point in time at cost. The carrying cost including the margin will initially be four per cent per annum.

Since the shares are owned by Scotia the shares will not be subject to immediate cancellation, which has been the case for regular buy backs carried out by the Company. However, the shares to be acquired will be considered acquired within the current Board authorization to buy back up to 7,500,000 shares (announced on 9 May, 2001). Until establishment of the Equity Swap Line 3,927,145 shares have been acquired within the total authorized.

Frontline has based on the above been notified by Scotia that the latter through market purchases executed today has acquired 150,000 Frontline common shares. The shares have been acquired at an average price of NOK 81.86.

Based on the above, the number of shares outstanding in the Company is the same as before the mentioned transaction, 76,392,566.

Hamilton, Bermuda
24 September, 2001