UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 20-F
                                   (Mark One)

[ ]              REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or (g)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                                       OR

[X]             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                   For the fiscal year ended December 31, 2004

                                       OR

[ ]             TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                        For the transition period from to

                         Commission file number 1-13944

                     NORDIC AMERICAN TANKER SHIPPING LIMITED
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

                               ISLANDS OF BERMUDA
 -------------------------------------------------------------------------------
                 (Jurisdiction of incorporation or organization)

                                   Reid House
                                31 Church Street
                                 Hamilton HM FX
                                     Bermuda

                    (Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act.


                                                   NAME OF EACH EXCHANGE
    TITLE OF EACH CLASS                              ON WHICH REGISTERED

         Common Shares                             New York Stock Exchange
   -------------------------                      -------------------------

Securities  registered or to be registered pursuant to Section 12(g) of the Act:
None

Securities for which there is a reporting  obligation  pursuant to Section 15(d)
of the Act: None

Indicate the number of  outstanding  shares of each of the  issuer's  classes of
capital  or common  stock as of the close of the  period  covered  by the annual
report.

Common Shares, par value $0.01                          13,067,838

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                Yes [X]  No [_]

Indicate by check mark which financial statement item the Registrant has elected
to follow.

                             Item 17[_]   Item 18 [X]

<PAGE>
<TABLE>
<CAPTION>
                                TABLE OF CONTENTS

                                                                               PAGE
<S>       <C>                                                                   <C>
Item 1.   Identity of Directors, Senior Management and Advisers..................6
Item 2.   Offer Statistics And Expected Timetable................................6
Item 3.   Key Information........................................................6
          A.  SELECTED FINANCIAL DATA............................................6
          B.  CAPITALIZATION AND INDEBTEDNESS....................................8
          C.  REASONS FOR THE OFFER AND USE OF PROCEEDS..........................8
          D.  RISK FACTORS.......................................................8
Item 4.   Information On The Company............................................15
          A.  HISTORY AND DEVELOPMENT OF THE COMPANY............................15
          B.  BUSINESS OVERVIEW.................................................15
          C.  ORGANIZATIONAL STRUCTURE..........................................25
          D.  PROPERTY, PLANT AND EQUIPMENT.....................................25
Item 5.   Operating And Financial Review And Prospects..........................25
          A.  OPERATING RESULTS.................................................25
          B.  RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC...............27
          C.  TREND INFORMATION.................................................27
          D.  OFF BALANCE SHEET ARRANGEMENTS....................................28
          E.  TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS.....................28
Item 6.   Directors, Senior Management And Employees............................29
          A.  DIRECTORS AND SENIOR MANAGEMENT...................................29
          B.  COMPENSATION......................................................32
          C.  BOARD PRACTICES...................................................33
          D.  EMPLOYEES.........................................................33
          E.  SHARE OWNERSHIP...................................................33
Item 7.   Major Shareholders And Related Party Transactions.....................34
          A.  MAJOR SHAREHOLDERS................................................34
          B.  RELATED PARTY TRANSACTIONS........................................34
          C.  INTERESTS OF EXPERTS AND COUNSEL..................................34
Item 8.   Financial Information.................................................34
          A.  CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION...........34
          B.  SIGNIFICANT CHANGES...............................................34
Item 9.   The Offer And Listing.................................................35
          B.  MARKETS.......................................................... 35
Item 10.      Additional Information............................................36
          A.  SHARE CAPITAL.....................................................36
          B.  MEMORANDUM AND ARTICLES OF ASSOCIATION............................36
          C.  MATERIAL CONTRACTS................................................37
          D.  EXCHANGE CONTROLS.................................................37
          E.  TAXATION..........................................................38
          F.  DIVIDENDS AND PAYING AGENTS.......................................38
          G.  STATEMENT BY EXPERTS..............................................38
          H.  DOCUMENTS ON DISPLAY..............................................38
          I.  SUBSIDIARY INFORMATION............................................39
Item 11.      Quantitative And Qualitative Disclosures About Market Risk........39
Item 12.      Description Of Securities Other Than Equity Securities............39
Item 13.      Defaults, Dividend Arrearages And Delinquencies...................39
Item 14.      Material Modifications To The Rights Of Security Holders
              And Use Of Proceeds...............................................39
Item 15.      Controls And Procedures...........................................39
Item 16.      Reserved..........................................................40
ITEM 16A.     AUdit Committee Financial Expert..................................40
ITEM 16B.     Code of Ethics....................................................40
ITEM 16C.     Principal Accountant Fees and Services............................40
ITEM 16D.     Exemptions From the Listing Standards
              For Audit Committees..............................................40
ITEM 16E.     Purchases of Equity Securities by the Issuer
              and Affiliated Persons............................................41
Item 17.      Financial Statements..................................Not applicable
Item 18.      Financial Statements..............................................41
</TABLE>


          This Annual Report on Form 20-F is  incorporated by reference into the
Registrant's Registration Statement No. 333-118128 on Form F-3.

<PAGE>

            CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain matters discussed herein may constitute forward-looking  statements. The
Private   Securities   Litigation  Reform  Act  of  1995  provides  safe  harbor
protections for  forward-looking  statements in order to encourage  companies to
provide prospective information about their business. Forward-looking statements
include  statements  concerning plans,  objectives,  goals,  strategies,  future
events or performance,  and underlying  assumptions and other statements,  which
are other than statements of historical facts.

The  Company  desires to take  advantage  of the safe harbor  provisions  of the
Private  Securities  Litigation  Reform  Act  of  1995  and  is  including  this
cautionary statement in connection with this safe harbor legislation.  The words
"believe,"  "anticipate,"  "intend," "estimate,"  "forecast," "project," "plan,"
"potential,"   "will,"  "may,"   "should,"   "expect,"   "pending"  and  similar
expressions identify forward-looking statements.

The forward-looking statements are based upon various assumptions, many of which
are based, in turn, upon further assumptions,  including without limitation, our
management's  examination of historical  operating trends, data contained in our
records and other data available  from third  parties.  Although we believe that
these  assumptions  were  reasonable  when made,  because these  assumptions are
inherently  subject to significant  uncertainties  and  contingencies  which are
difficult or impossible to predict and are beyond our control,  we cannot assure
you  that  we  will  achieve  or  accomplish  these  expectations,   beliefs  or
projections. We undertake no obligation to update any forward-looking statement,
whether as a result of new information, future events or otherwise.

Important  factors  that,  in our view,  could  cause  actual  results to differ
materially from those discussed in the  forward-looking  statements  include the
strength of world economies and currencies, general market conditions, including
fluctuations in charter rates and vessel values, changes in demand in the tanker
market,  as a result of changes in OPEC's petroleum  production levels and world
wide oil consumption and storage,  changes in our operating expenses,  including
bunker  prices,  drydocking  and  insurance  costs,  the market for our vessels,
availability of financing and  refinancing,  changes in  governmental  rules and
regulations or actions taken by regulatory authorities, potential liability from
pending or future  litigation,  general  domestic  and  international  political
conditions,  potential  disruption  of  shipping  routes  due  to  accidents  or
political  events,  vessels  breakdowns  and  instances of  off-hires  and other
important  factors  described  from  time to time in the  reports  filed  by the
Company with the Securities and Exchange Commission.


Please note in this annual report,  "we", "us", "our", "The Company",  all refer
to Nordic American Tanker Shipping Limited and its subsidiaries. ITEM 1.

<PAGE>


ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

                  Not Applicable

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE

                  Not Applicable

ITEM 3.  KEY INFORMATION

A. SELECTED FINANCIAL DATA

         The  following  historical  financial  information  should  be  read in
conjunction with our audited consolidated financial statements and related notes
all of  which  are  included  elsewhere  in this  document  and  "Operating  and
Financial  Review and  Prospects".  The statement of operations data for each of
the three years ended  December 31, 2002,  2003,  and 2004 and selected  balance
sheet  data as of  December  31,  2003  and 2004 are  derived  from our  audited
financial  statements  included  elsewhere in this  document.  The statements of
operations  data for the years ended  December  31,  2000 and 2001 and  selected
balance  sheet data as of December 31, 2000,  2001 and 2002 are derived from our
audited financial statements not included in this document.


<PAGE>
<TABLE>
<CAPTION>
SELECTED FINANCIAL DATA
                                                                                   December 31,
---------------------------------------------------------------------------------------------------------------------------------
All figures in USD                                     2004            2003            2002           2001            2000
---------------------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>             <C>            <C>             <C>             <C>
Voyage revenue                                         67,451,598      37,370,756     18,057,989      28,359,568      36,577,262
Voyage expenses                                       (4,925,353)       (184,781)      (184,781)       (184,781)       (185,288)
Vessel operating expense                              (1,976,766)               -              -               -               -
Administrative expenses                              (10,851,688)       (468,087)      (427,048)       (353,739)       (373,291)
Depreciation                                          (6,918,164)     (6,831,040)    (6,831,040)     (6,831,040)     (6,831,040)
---------------------------------------------------------------------------------------------------------------------------------
Net operating income                                   42,779,627      29,886,848     10,615,120      20,990,008      29,187,643

Interest income                                           143,231          26,462         21,409         189,244         277,552
Interest expense                                      (1,971,304)     (1,797,981)    (1,764,424)     (1,769,000)     (1,770,808)
Other financial charges                                 (135,621)        (15,040)       (24,837)        (24,776)        (25,423)
---------------------------------------------------------------------------------------------------------------------------------
Net financial items                                   (1,963,694)     (1,786,559)    (1,767,852)     (1,604,532)     (1,518,679)
---------------------------------------------------------------------------------------------------------------------------------
Net profit                                             40,815,932      28,100,289      8,847,268      19,385,476      27,668,964
=================================================================================================================================

Basic and diluted earnings per share                         4.05            2.89           0.91            2.00            2.85
Cash dividends declared per share                            4.84            3.05           1.35            3.87            2.56
Weighted average shares outstanding basic and
diluted                                                10,078,391       9,706,606      9,706,606       9,706,606       9,706,606

Other financial data:
Net cash from operating activities                     62,817,267      29,893,551     12,750,908      36,272,601      24,264,865
Dividend paid                                          47,195,842      29,605,410     13,103,993      37,564,658      24,848,957

Selected Balance Sheet Data (at period end):
Cash and cash deposit                                  30,732,516         565,924        277,783         630,868       1,922,925
Total assets                                          224,203,411     136,896,298    138,579,559     142,658,488     160,842,504
Total debt                                                      0      30,000,000     30,000,000      30,000,000      30,000,000
Shareholder's equity                                  221,868,393     105,707,976    106,347,097     111,841,822     130,799,004
</TABLE>
<PAGE>

B. CAPITALIZATION AND INDEBTEDNESS

                  Not Applicable

C. REASONS FOR THE OFFER AND USE OF PROCEEDS

                  Not Applicable

D. RISK FACTORS

         Investing in our common shares  involves  risks.  You should  carefully
consider  the  following  risk  factors  relating  to our common  shares and our
business in addition  to the other  information  contained  or  incorporated  by
reference in this  prospectus  supplement  and the  accompanying  prospectus  in
deciding whether to invest in our common shares.

                         Industry Specific Risk Factors

         The cyclical nature of the tanker industry may lead to volatile changes
in charter rates and vessel values which may adversely affect our earnings.

         If the tanker  market,  which has been  cyclical,  is  depressed in the
future,  our  earnings  and  available  cash flow may  decrease.  Our ability to
recharter our vessels or to sell them on the  expiration or termination of their
charters and the charter rates  payable  under our two spot market  related time
charters,  the  spot  charters  we  expect  to enter  into,  or any  renewal  or
replacement charters,  will depend upon, among other things, economic conditions
in the tanker  market.  Fluctuations  in charter  rates and tanker values result
from  changes in the supply and demand for tanker  capacity  and  changes in the
supply and demand for oil and oil products.

         The factors  affecting the supply and demand for tankers are outside of
our control, and the nature, timing and degree of changes in industry conditions
are unpredictable.

         The factors that influence demand for tanker capacity include,

            o   demand for oil and oil products,

            o   supply of oil and oil products,

            o   global and regional economic conditions,

            o   the distance oil and oil products are to be moved by sea, and

            o   changes in seaborne and other transportation patterns.

            o   The  factors  that  influence  the  supply  of  tanker  capacity
                include:

            o   the number of newbuilding deliveries,

            o   the scrapping rate of older vessels,

            o   conversion of tankers to other uses,

            o   the number of vessels that are out of service, and

            o   environmental concerns and regulations.

         Historically,  the tanker markets have been volatile as a result of the
many  conditions  and factors  that can affect the price,  supply and demand for
tanker  capacity.  Changes  in  demand  for  transportation  of oil over  longer
distances  and supply of tankers  to carry  that oil may  materially  affect our
revenues,  profitability  and  cash  flows.  Two of our  vessels  are  currently
operated  under time  charters to BP Shipping  Ltd.,  or BP Shipping,  on market
related  rates and  three of our  vessels  are  currently  operated  in the spot
market.  We  cannot  assure  you  that we will  receive  any  minimum  level  of
charterhire  for the  vessels  operated  in the spot  market  or on spot  market
related time charters.

Any  decrease  in spot  charter  rates in the  future may  adversely  affect our
earnings and our ability to pay dividends.

         Of our fleet of six vessels,  one is on a long term fixed-rate charter,
while the other five are currently expected to be operated in the spot market or
on time charters with spot market related rates.

         We may enter into spot charters for any additional  vessels that the we
may  acquire in the future.  Although  spot  chartering  is common in the tanker
industry, the spot charter market may fluctuate  significantly based upon tanker
and oil supply and demand.  The successful  operation of our vessels in the spot
charter  market  depends upon,  among other things,  obtaining  profitable  spot
charters and minimizing, to the extent possible, time spent waiting for charters
and time spent traveling unladen to pick up cargo.  While the tanker spot market
is currently  high, that market is very volatile,  and, in the past,  there have
been periods when spot rates have declined  below the operating cost of vessels.
We cannot  assure you that  future  spot  charters  will be  available  at rates
sufficient  to  enable  our  vessels  trading  in the  spot  market  to  operate
profitably and to pay dividends.

         Normally,  tanker  markets are  stronger in the fall and winter  months
(the  fourth  and  first  quarters  of the  calendar  year) in  anticipation  of
increased oil consumption in the northern  hemisphere  during the winter months.
Unpredictable  weather  patterns and  variations in oil reserves  disrupt tanker
scheduling.  Seasonal  variations in tanker demand and, as a result,  in charter
rates will affect any spot market related rates that we may receive.

Compliance  with  safety,   environmental  and  other   governmental  and  other
requirements may adversely affect our business.

         The shipping  industry is affected by numerous  regulations in the form
of international  conventions,  national,  state and local laws and national and
international  regulations in force in the  jurisdictions  in which such tankers
operate,  as well as in the  country  or  countries  in which such  tankers  are
registered.  These  regulations  include the U.S. Oil  Pollution Act of 1990, or
OPA, the International Convention on Civil Liability for Oil Pollution Damage of
1969,  International  Convention for the Prevention of Pollution from Ships, the
IMO  International  Convention  for the Safety of Life at Sea of 1974, or SOLAS,
the  International  Convention  on Load  Lines  of  1966  and  the  U.S.  Marine
Transportation  Security  Act of  2002,  each of  which  imposes  environmental,
technical,  safety,  operational or financial  requirements  on us. In addition,
vessel  classification  societies  also  impose  significant  safety  and  other
requirements on our vessels. Regulation of vessels, particularly in the areas of
safety  and  environmental  impact  may  change in the  future and may limit our
ability to operate our business or require significant  capital  expenditures be
incurred on our vessels to keep them in compliance.

The value of our vessels may  fluctuate and could result in a lower price of our
common shares.

         Tanker values have generally  experienced high  volatility.  You should
expect the market  value of our oil tankers to  fluctuate,  depending on general
economic and market  conditions  affecting the tanker  industry and  competition
from other shipping  companies,  types and sizes of vessels,  and other modes of
transportation.  In addition,  as vessels grow older,  they generally decline in
value.  These  factors  will affect the value of our vessels.  Declining  tanker
values  could  affect  our  ability  to raise cash by  limiting  our  ability to
refinance our vessels, thereby adversely impacting our liquidity, or result in a
breach of our loan  covenants,  which could result in defaults  under our credit
facility. If we determine at any time that a vessel's future limited useful life
and earnings  require us to impair its value on our financial  statements,  that
could  result  in a  charge  against  our  earnings  and  the  reduction  of our
shareholders'  equity.  Due to the cyclical nature of the tanker market,  if for
any reason we sell vessels at a time when tanker  prices have  fallen,  the sale
may be at less than the vessel's  carrying  amount on our financial  statements,
with the result that we would also incur a loss and a reduction in earnings. Any
such reduction could result in a lower share price.

Shipping is an inherently  risky business  involving  global  operations and our
vessels  are  exposed to  international  risks  which  could  reduce  revenue or
increase expenses.

         Shipping companies conduct global  operations.  Our vessels are at risk
of damage or loss because of events such as mechanical failure, collision, human
error, war, terrorism, piracy, cargo loss and bad weather. In addition, changing
economic,  regulatory  and  political  conditions in some  countries,  including
political and military conflicts,  have from time to time resulted in attacks on
vessels,  mining of waterways,  piracy,  terrorism,  labor strikes and boycotts.
These sorts of events could  interfere  with shipping lanes and result in market
disruptions.

Terrorist  attacks,  such as the attacks on the United  States on September  11,
2001, and other acts of violence or war may affect the financial markets and our
business, results of operations and financial condition.

         Terrorist attacks such as the attacks on the United States on September
11, 2001 and the United States' continuing response to these attacks, as well as
the threat of future terrorist  attacks,  continues to cause  uncertainty in the
world financial markets,  including the energy markets.  The continuing conflict
in Iraq may lead to  additional  acts of  terrorism,  armed  conflict  and civil
disturbance  around the world,  which may  contribute  to further,  instability,
including in the oil markets.  Terrorist attacks, such as the attack on the M.T.
Limburg in Yemen in October 2002, may also negatively  affect our trade patterns
or other  operations and directly  impact our vessels or our  customers.  Future
terrorist attacks could result in increased  volatility of the financial markets
in the United  States and globally and could result in an economic  recession in
the United States or the world. Any of these  occurrences  could have a material
adverse impact on our operating results, revenue and costs.

Arrests of our vessels by maritime  claimants could cause a significant  loss of
earnings for the related off hire period.

         Crew members,  suppliers of goods and services to a vessel, shippers of
cargo and other  parties may be entitled to a maritime lien against a vessel for
unsatisfied  debts,  claims  or  damages.  In  many  jurisdictions,  a  maritime
lienholder  may enforce its lien by  "arresting" or "attaching" a vessel through
foreclosure proceedings.  The arrest or attachment of one or more of our vessels
could result in a significant  loss of earnings for the related off-hire period.
In  addition,  in  jurisdictions  where the "sister  ship"  theory of  liability
applies,  a claimant  may arrest the vessel  which is subject to the  claimant's
maritime  lien  and any  "associated"  vessel,  which  is any  vessel  owned  or
controlled by the same owner.  In countries with "sister ship"  liability  laws,
claims  might be asserted  against us or any of our vessels for  liabilities  of
other vessels that we own.

Governments  could  requisition our vessels during a period of war or emergency,
resulting in a loss of earnings.

         A  government  could  requisition  for  title  or  seize  our  vessels.
Requisition  for title  occurs when a government  takes  control of a vessel and
becomes its owner.  Also, a government  could  requisition our vessels for hire.
Requisition  for hire occurs  when a  government  takes  control of a vessel and
effectively  becomes its charterer at dictated  charter  rates.  Although we, as
owner,  would be entitled to  compensation  in the event of a  requisition,  the
amount and timing of payment would be uncertain.

                          Company Specific Risk Factors

We cannot guarantee that we will continue to make cash distributions.

         We have  made  distributions  quarterly  since  September  1997.  It is
possible that we could incur other expenses or contingent liabilities that would
reduce or eliminate the cash available for distribution as dividends. Our credit
facility prohibits the declaration and payment of dividends if we are in default
under it. In addition,  the  declaration  and payment of dividends is subject at
all  times to the  discretion  of our Board of  Directors  and  compliance  with
Bermuda  law, and may be  dependent  upon the adoption at the annual  meeting of
shareholders of a resolution effectuating a reduction in our share premium in an
amount  equal  to the  estimated  amount  of  dividends  to be paid in the  next
succeeding  year.  We  cannot  assure  you that we will pay  dividends  at rates
previously paid or at all.

We may not be able to grow or to effectively manage our growth.

         One of our principal strategies is to continue to grow by expanding our
operations and adding to our fleet.  Our future growth will depend upon a number
of factors,  some of which may not be within our control.  These factors include
our ability to:

            o   identify   suitable   tankers  and/or  shipping   companies  for
                acquisitions,

            o   identify  businesses  engaged in  managing,  operating or owning
                tankers for acquisitions or joint ventures,

            o   integrate any acquired tankers or businesses  successfully  with
                our existing operations,

            o   hire,  train and retain  qualified  personnel and crew to manage
                and operate our growing business and fleet,

            o   identify additional new markets,

            o   improve our operating and financial systems and controls, and

            o   obtain required financing for our existing and new operations.

         Our failure to effectively  identify,  purchase,  develop and integrate
any  tankers  or  businesses  could  adversely  affect our  business,  financial
condition and results of operations. The number of employees of Scandic American
Shipping  Ltd.,  or Scandic or the Manager that perform  services for us and our
current  operating and financial systems may not be adequate as we implement our
plan to expand  the size of our  fleet,  and we may not be able to  require  the
Manager to hire more employees or adequately improve those systems. In addition,
acquisitions  may require  additional  equity  issuances or debt issuances (with
amortization payments), both of which could lower dividends per share. If we are
unable to execute the points noted above,  our financial  condition and dividend
rates may be adversely affected.

We are  dependent on the Manager and there may be conflicts of interest  arising
from the relationship between our Chairman and the Manager.

         Our success  depends to a  significant  extent upon the  abilities  and
efforts of the Manager and our management team. Our success will depend upon our
and the Manager's ability to hire and retain key members of our management team.
The  loss of any of  these  individuals  could  adversely  affect  our  business
prospects and financial condition.  Difficulty in hiring and retaining personnel
could adversely  affect our results of operations.  We do not maintain "key man"
life insurance on any of our officers.

         Herbj0rn Hansson, our Chairman,  President and Chief Executive Officer,
is also an owner of the Manager.  In addition,  one of our  directors is also an
owner of the Manager.  The Manager may engage in business  activities other than
with respect to the Company.  The fiduciary  duty of a director may compete with
or be different  from the  interests of the Manager and may create  conflicts of
interest in relation to that director's duties to the Company.

An  increase  in  operating  costs  could  adversely  affect  our cash  flow and
financial  condition.

         Under the original  bareboat  charters to BP Shipping,  BP Shipping was
responsible for operating and voyage costs.  Under the time and spot charters of
five of our six vessels,  we are responsible for many of such costs.  Our vessel
operating expenses include the costs of crew, fuel (for spot chartered vessels),
provisions, deck and engine stores, insurance and maintenance and repairs, which
depend on a variety of factors,  many of which are beyond our  control.  Some of
these costs,  primarily  relating to insurance  and enhanced  security  measures
implemented  after  September  11,  2001 and  fuel,  have  been  increasing.  In
addition,  if our  vessels  suffer  damage,  they may need to be  repaired  at a
drydocking  facility.  The costs of drydock repairs are unpredictable and can be
substantial.  Increases  in any of  these  costs  would  decrease  earnings  and
dividends per share.

Our vessels operate in the highly competitive international tanker market.

         The  operation  of  tanker  vessels  and  transportation  of crude  and
petroleum  products and the other  businesses  in which we operate are extremely
competitive.  Competition  arises primarily from other tanker owners,  including
major oil companies as well as independent  tanker companies,  some of whom have
substantially  greater resources.  Competition for the transportation of oil and
oil products can be intense and depends on price, location, size, age, condition
and the acceptability of the tanker and its operators to the charterers. We will
have to compete with other tanker owners,  including major oil companies as well
as independent tanker companies.

         Our market  share may  decrease  in the  future.  We may not be able to
compete  profitably  as we expand our business  into new  geographic  regions or
provide new services.  New markets may require  different  skills,  knowledge or
strategies than we use in our current markets,  and the competitors in those new
markets may have greater financial strength and capital resources than we do.

Purchasing and operating  secondhand  vessels may result in increased  operating
costs which could adversely affect our earnings and as our fleet ages, the risks
associated with older vessels could adversely affect our operations.

         Our current business  strategy  includes  additional growth through the
acquisition of additional new and secondhand vessels.  While we normally inspect
secondhand vessels prior to purchase, this does not normally provide us with the
same knowledge about their condition that we would have had if these vessels had
been built for and  operated  exclusively  by us.  Also,  we may not receive the
benefit of warranties from the builders if the vessels we buy are older than one
year. We will receive a builder's  warranty in connection  with the  newbuilding
that we have  agreed to acquire,  however,  we will not receive the benefit of a
warranty for the secondhand vessel that we have agreed to acquire.

         In general,  the costs to maintain a vessel in good operating condition
increase  with  the  age  of  the  vessel.  Older  vessels  are  typically  less
fuel-efficient  than more recently  constructed  vessels due to  improvements in
engine  technology.  Cargo  insurance  rates  increase with the age of a vessel,
making older vessels less desirable to charterers.

         Governmental  regulations,  safety or other equipment standards related
to the age of vessels may require expenditures for alterations,  or the addition
of new  equipment,  to our vessels and may  restrict the type of  activities  in
which the  vessels  may  engage.  We cannot  assure you that as our  vessels age
market  conditions  will justify those  expenditures or enable us to operate our
vessels profitably during the remainder of their useful lives.

Servicing debt which we may incur in the future would limit funds  available for
other purposes and if we cannot service our debt, we may lose our vessels.

         Borrowing under our credit facility would require us to dedicate a part
of our cash flow from operations to paying interest on our  indebtedness.  These
payments would limit funds available for working capital,  capital  expenditures
and other purposes,  including making  distributions to shareholders and further
equity or debt  financing  in the  future.  Amounts  borrowed  under our  credit
facility bear interest at variable  rates.  Increases in prevailing  rates could
increase the amounts  that we would have to pay to our lenders,  even though the
outstanding principal amount remains the same, and our net income and cash flows
would decrease. In addition, if we elect to convert amounts drawn under our $250
million facility into a term loan we will be required to repay principal of such
loans in semi-annual installments.  We expect our earnings and cash flow to vary
from  year to  year  due to the  cyclical  nature  of the  tanker  industry.  In
addition, our current policy is not to accumulate cash, but rather to distribute
our available cash to shareholders. If we do not generate or reserve enough cash
flow from operations to satisfy our debt  obligations,  we may have to undertake
alternative financing plans, such as:

            o   seeking to raise additional capital,

            o   refinancing or restructuring our debt,

            o   selling tankers or other assets, or

            o   reducing or delaying capital investments.

         However,  these alternative  financing plans, if necessary,  may not be
sufficient  to allow us to meet our debt  obligations.  If we are unable to meet
our debt  obligations or if some other default occurs under our credit facility,
the lenders could elect to declare that debt, together with accrued interest and
fees,  to be  immediately  due and payable and  proceed  against the  collateral
securing that debt, which  constitutes our entire fleet and substantially all of
our assets.

Our credit facility contains restrictive covenants which may limit our liquidity
and corporate activities.

         Our credit facility imposes operating and financial restrictions on us.
These restrictions may limit our ability to:

            o   pay dividends and make capital  expenditures  if we do not repay
                amounts  drawn under our credit  facility or if there is another
                default under our credit facility,

            o   incur  additional   indebtedness,   including  the  issuance  of
                guarantees,

            o   create liens on our assets,

            o   change the flag, class or management of our vessels or terminate
                or materially  amend the management  agreement  relating to each
                vessel,

            o   sell our vessels,

            o   merge or consolidate  with, or transfer all or substantially all
                our assets to, another person, and

            o   enter into a new line of business.

         Therefore,  we may need to seek permission from our lenders in order to
engage in some corporate  actions.  Our lenders' interests may be different from
ours  and we  cannot  guarantee  that we will be  able to  obtain  our  lenders'
permission  when  needed.  This may limit our ability to pay  dividends  to you,
finance our future  operations or capital  requirements,  make  acquisitions  or
pursue business opportunities.

Shipping is an inherently  risky  business and our insurance may not be adequate
to cover all our losses.

         There  are  a  number  of  risks   associated  with  the  operation  of
ocean-going vessels, including mechanical failure,  collision, human error, war,
terrorism,  property loss, cargo loss or damage and business interruption due to
political circumstances in foreign countries, hostilities and labor strikes. Any
of these events may result in loss of revenues,  increased  costs and  decreased
cash flows. In addition,  the operation of any vessel is subject to the inherent
possibility  of marine  disaster,  including oil spills and other  environmental
mishaps,  and the  liabilities  arising  from  owning and  operating  vessels in
international  trade. We cannot assure investors that our insurance will protect
us against all risks. We may not be able to maintain adequate insurance coverage
at  reasonable  rates for our fleet in the future and the  insurers  may not pay
particular  claims. For example, a catastrophic spill could exceed our insurance
coverage and have a material adverse effect on our financial  condition.  In the
past, new and stricter  environmental  regulations  have led to higher costs for
insurance covering environmental damage or pollution,  and new regulations could
lead to  similar  increases  or even make this  type of  insurance  unavailable.
Furthermore,  even if insurance coverage is adequate to cover our losses, we may
not be able to timely obtain a  replacement  ship in the event of a loss. We may
also be  subject to calls,  or  premiums,  in amounts  based not only on our own
claim records but also the claim records of all other members of the  protection
and indemnity associations through which we receive indemnity insurance coverage
for tort  liability.  Our  payment of these calls  could  result in  significant
expenses  to us which  could  reduce  our cash  flows and place  strains  on our
liquidity and capital resources.

Because some of our expenses are incurred in foreign currencies,  we are exposed
to exchange rate risks.

         The  charterers of our vessels pay us in U.S.  dollars.  While we incur
most of our expenses in U.S.  dollars,  we have in the past incurred expenses in
other currencies,  most notably the Norwegian  Kroner.  Declines in the value of
the U.S. dollar  relative to the Norwegian  Kroner,  or the other  currencies in
which we incur  expenses,  would  increase the U.S.  dollar cost of paying these
expenses and thus would adversely affect our results of operations.

We may have to pay tax on United  States source  income,  which would reduce our
earnings.

         Under the United States Internal Revenue Code of 1986, or the Code, 50%
of the gross shipping income of a vessel owning or chartering corporation,  such
as ourselves,  attributable to transportation that begins or ends, but that does
not  both  begin  and end,  in the U.S.  will be  characterized  as U.S.  source
shipping  income and such income will be subject to a 4% United  States  federal
income tax unless that  corporation is entitled to a special tax exemption under
the Code which applies to the  international  shipping income derived by certain
non-United States corporations. We expect that we qualify for this statutory tax
exemption and we will take this position for U.S. tax return reporting purposes.
However, there are several risks that could cause us to become taxed on our U.S.
source shipping income. Due to the factual nature of the issues involved, we can
give no assurances on our tax-exempt status.

         If we are not entitled to this  statutory tax exemption for any taxable
year, we could be subject for any such year to a 4% United States federal income
tax on our U.S. source shipping income.  The imposition of this tax could have a
negative effect on our business and would result in decreased earnings available
for distribution to our shareholders.

If U.S.  tax  authorities  were to treat  us as a  "passive  foreign  investment
company," that could have adverse consequences on U.S. holders.

         A foreign  corporation will be treated as a "passive foreign investment
company" for U.S.  Federal income tax purposes if either (1) at least 75% of its
gross income for any taxable year consists of certain types of "passive income,"
or (2) at least 50% of the average value of the corporation's assets produce, or
are held for the production of, such types of "passive  income." For purposes of
these tests, "passive income" includes dividends,  interest,  and gains from the
sale or exchange of investment property and rents and royalties other than rents
and royalties  which are received from unrelated  parties in connection with the
active conduct of trade or business. For purposes of these tests, income derived
from the  performance  of services does not constitute  "passive  income." Those
holders of a passive foreign investment company who are citizens or residents of
the United  States or  domestic  entities  would  alternatively  be subject to a
special  adverse  U.S.  Federal  income  tax regime  with  respect to the income
derived by the  passive  foreign  investment  company,  the  distributions  they
receive from the passive foreign  investment  company and the gain, if any, they
derive from the sale or other disposition of their shares in the passive foreign
investment company. In particular,  dividends paid by us would not be treated as
"qualified  dividend income" eligible for preferential tax rates in the hands of
noncorporate U.S. shareholders.

         Based on our current operations and future projections, we believe that
we will no longer be a passive  foreign  investment  company with respect to the
taxable year 2005 and thereafter.  As a result,  noncorporate U.S.  shareholders
should  be  eligible  to treat  dividends  paid by us after  2005 as  "qualified
dividend  income" which is subject to  preferential  tax rates  (through  2008).
Since we expect to derive  more than 25% of our  income  each year from our time
chartering and voyage chartering activities, we believe that such income will be
treated for relevant U.S. Federal income tax purposes as services income, rather
than rental income. Correspondingly,  such income should not constitute "passive
income,"  and  the  assets  that we own  and  operate  in  connection  with  the
production of that income (which should  constitute  more than 50% of our assets
each year), in particular our vessels,  should not constitute passive assets for
purposes of determining  whether we are a passive foreign  investment company in
any taxable year.  However,  no assurance can be given that the Internal Revenue
Service  will accept this  position  or that we would not  constitute  a passive
foreign  investment  company  for any  future  taxable  year if there were to be
changes in the nature and extent of our operations.

                       Risks Relating to Our Common Shares

Our common  share price may be highly  volatile  and future  sales of our common
shares could cause the market price of our common shares to decline.

         The market price of our common shares has historically  fluctuated over
a wide range and may  continue to  fluctuate  significantly  in response to many
factors,  such as actual or anticipated  fluctuations in our operating  results,
changes in financial estimates by securities  analysts,  economic and regulatory
trends,  general market conditions,  rumors and other factors, many of which are
beyond our  control.  Investors  in our common  shares may not be able to resell
their  shares  at or above  their  purchase  price due to those  factors,  which
include the risks and uncertainties set forth in this report.

Because we are a foreign  corporation,  you may not have the same  rights that a
shareholder in a U.S. corporation may have.

         We are a Bermuda  exempted  company.  Our memorandum of association and
by-laws and The Companies Act, 1981 of Bermuda, or the Companies Act, govern our
affairs.  The  Companies Act does not as clearly  establish  your rights and the
fiduciary  responsibilities  of  our  directors  as  do  statutes  and  judicial
precedent in some U.S. jurisdictions. Therefore, you may have more difficulty in
protecting  your  interests  as a  shareholder  in the  face of  actions  by the
management,  directors or controlling  shareholders than would shareholders of a
corporation  incorporated in a United States jurisdiction.  There is a statutory
remedy under Section 111 of The Companies Act which  provides that a shareholder
may seek redress in the courts as long as such  shareholder  can establish  that
our affairs are being conducted,  or have been conducted, in a manner oppressive
or prejudicial to the interests of some part of the shareholders, including such
shareholder.  However,  the principles  governing Section 111 have not been well
developed.

It may not be possible for our investors to enforce U.S. judgments against us.

         We are incorporated in the Islands of Bermuda. Substantially all of our
assets and those of our subsidiaries are located outside the United States. As a
result,  it may be difficult or impossible  for U.S.  investors to serve process
within  the  United  States  upon us or to  enforce  judgment  upon us for civil
liabilities in U.S.  courts.  In addition,  you should not assume that courts in
the countries in which we are  incorporated  or where our assets are located (1)
would enforce  judgments of U.S.  courts  obtained in actions against based upon
the civil liability  provisions of applicable U.S.  federal and state securities
laws or (2) would enforce,  in original  actions,  liabilities  against us based
upon these laws.

ITEM 4.  INFORMATION ON THE COMPANY

A. HISTORY AND DEVELOPMENT OF THE COMPANY

         Nordic American Tanker Shipping Limited, or the Company, was founded on
June 12,  1995  under  the laws of the  Islands  of  Bermuda  and  maintain  our
principal offices at Reid House, 31 Church Street,  Hamilton HM 12, Bermuda. Our
telephone number at such address is (441) 292 7202.

         The  Company  was formed for the purpose of  acquiring  and  chartering
three Suezmax tankers that were built in 1997. These three vessels were bareboat
chartered to BP Shipping Ltd., or BP Shipping,  for a period of seven years.  BP
Shipping  redelivered these three vessels to us in September 2004,  October 2004
and November 2004, respectively. We have continued contracts with BP Shipping by
time  chartering to it two of our original  vessels at spot market related rates
for  three-year  terms up to the autumn of 2007. We have bareboat  chartered the
third of our  original  three  vessels to Gulf  Navigation  Company LLC, or Gulf
Navigation,  of  Dubai,  U.A.E.  for a term of  five  years  at a fixed  rate of
charterhire,  subject to two one-year extensions at Gulf Navigation's option. In
November 2004, we acquired our fourth  vessel,  and acquired our fifth and sixth
vessels in March 2005.  We are  currently  operating  these  vessels in the spot
market.

B. BUSINESS OVERVIEW

        Our Fleet

         Our fleet,  including  the two  additional  vessels we have acquired in
2005,  consists of six modern double-hull  Suezmax tankers.  The following chart
provides information regarding each vessel, including its employment status.
<TABLE>
<CAPTION>
                                                         Year    Dead-       Employment Status
Vessel                                    Yard           Built   weight tons (Expiration Date)         Flag
-------------------------------------------------------------------------------------------------------------------
<S>                                       <C>            <C>       <C>        <C>                      <C>
Gulf Scandic (ex. British Harrier)        Samsung        1997      151,459    Bareboat (Nov. 2009)      Isle of Man
Nordic Hawk (ex. British Hawk)            Samsung        1997      151,459    TC/spot(1) (Oct. 2007)    Bahamas
Nordic Hunter (ex. British Hunter)        Samsung        1997      151,459    TC/spot(1) (Oct. 2007)    Bahamas
Nordic Voyager (ex. Wilma Yangtze)        Dalian New     1997      149,591    Spot                      Norway
Nordic Fighter (ex. Front Fighter)        Hyundai        1998      153,181    Spot(2)                   Norway
Nordic Freedom (newbuilding)              Daewoo         2005      159,500    Spot(2)                   Bahamas
</TABLE>

(1) TC/Spot = Time Charter on spot market  related  terms.
(2) The vessels were delivered to us in late March 2005.

Our Charters

         We operate our vessels on bareboat charter,  spot related time charters
and in the spot market.  Our goal is to manage our cash flows through the use of
fixed-rate bareboat for part of our fleet, while taking advantage of potentially
higher market rates  through time  charters  with spot market  related rates and
voyage charters.

Bareboat Charters

         We  have  chartered  one of our  vessels,  the  Gulf  Scandic,  under a
bareboat charter to Gulf Navigation,  for a period of five years, terminating in
the  fourth  quarter  of  2009,  subject  to two  one-year  extensions  at  Gulf
Navigation's option. Under the terms of the bareboat charter, Gulf Navigation is
obligated to pay a fixed  charterhire  of $17,325 per day for the entire charter
period.  During the charter  period,  Gulf  Navigation  will be responsible  for
operating and  maintaining  the vessel and will bear all costs and expenses with
respect to the vessel.

Time Charters

         We have  chartered  two of our vessels,  the Nordic Hawk and the Nordic
Hunter,  under spot market  related time charters to BP Shipping for a period of
three years each,  terminating  between  September 1 and October 31,  2007.  The
amount of  charterhire  payable  under the charters to BP Shipping is based on a
formula designed to generate earnings to us as if we had operated the vessels in
the spot market on two routes used for the calculation, less 5%. The charterhire
is payable to us monthly.  Under the time  charters,  BP Shipping is responsible
for all voyage related costs while the Company is responsible  for providing the
crew and paying other operating costs.

Spot Charters

         We currently operate one of our four vessels,  the Nordic Voyager,  and
have deployed the two additional vessels that we have recently purchased in 2005
(the  Nordic  Fighter  and the  Nordic  Freedom),  in the spot  market.  Tankers
operating in the spot market  typically  are chartered for a single voyage which
may last up to several weeks.  Tankers operating in the spot market may generate
increased  profit margins  during  improvements  in tanker rates,  while tankers
operating  fixed-rate  time charters  generally  provide more  predictable  cash
flows.

         Under a typical  voyage  charter  in the spot  market,  we will be paid
freight on the basis of moving cargo from a loading port to a discharge port. We
are  responsible  for  paying  both  operating  costs and  voyage  costs and the
charterer is responsible for any delay at the loading or discharging ports.

Our Credit Facility

         In October 2004, we entered into the Credit Facility, which consists of
a $50 million  revolving  credit  facility and a $250 million  revolving  credit
facility.  The $50 million  facility  will  mature in October  2007 and the $250
million  facility will mature in October  2005,  unless we exercise our one-year
extension  option or our option to convert any drawn amounts to a five-year term
loan.  Amounts  borrowed under the Credit Facility bear interest at a rate equal
to LIBOR  plus a margin  of 0.80% to 1.20%  per year  (depending  on the loan to
vessel value ratio).

         We may draw unborrowed  amounts under the Credit Facility in connection
with any future vessel acquisitions or for working capital purposes.

         Borrowings  under the Credit Facility are secured by mortgages over our
existing  and new  vessels  and  assignments  of earnings  and  insurances,  and
drawings will be available subject to loan to vessel value ratios. The terms and
conditions of the Credit Facility  require  compliance with certain  restrictive
covenants,  which we feel are consistent with loan facilities  incurred by other
shipping  companies.  Under the Credit  Facility,  we are,  among other  things,
required to

            o   maintain certain loan to vessel value ratios,

            o   maintain a book equity of no less than $75 million,

            o   remain listed on a recognized stock exchange, and

            o   obtain the consent of the lenders prior to creating liens on our
                vessels.

         The Credit Facility  provides that we may not pay dividends if there is
a  default  under  the  Credit  Facility.  We will be able to pay  dividends  in
accordance  with our dividend policy as long as we repay any amounts drawn under
the $250  million  facility  within  one year  from the  closing  of the  Credit
Facility and are not otherwise in default of the Credit Facility.

The International Tanker Market

         International  seaborne  oil  and  petroleum  products   transportation
services  are  mainly  provided  by two types of  operators:  major oil  company
captive fleets (both private and state-owned) and independent  shipowner fleets.
Both types of operators  transport  oil under  short-term  contracts  (including
single-voyage  "spot  charters") and long-term time charters with oil companies,
oil traders,  large oil consumers,  petroleum  product  producers and government
agencies.  The oil companies  own, or control  through  long-term time charters,
approximately one third of the current world tanker capacity,  while independent
companies  own or control the balance of the fleet.  The oil companies use their
fleets  not only to  transport  their  own oil,  but also to  transport  oil for
third-party  charterers  in  direct  competition  with  independent  owners  and
operators in the tanker charter market.

         The oil  transportation  industry  has  historically  been  subject  to
regulation by national authorities and through international  conventions.  Over
recent years, however, an environmental  protection regime has evolved which has
a significant  impact on the operations of  participants  in the industry in the
form of increasingly more stringent inspection  requirements,  closer monitoring
of   pollution-related   events,   and  generally  higher  costs  and  potential
liabilities for the owners and operators of tankers.

         In order to benefit from  economies of scale,  tanker  charterers  will
typically  charter the largest  possible  vessel to  transport  oil or products,
consistent with port and canal  dimensional  restrictions  and optimal cargo lot
sizes.  The oil tanker fleet is generally  divided into the following five major
types of vessels,  based on vessel  carrying  capacity:  (i) ULCC-size  range of
approximately  320,000 to 450,000 dwt;  (ii)  VLCC-size  range of  approximately
200,000 to 320,000 dwt; (iii)  Suezmax-size  range of  approximately  120,000 to
200,000 dwt; (iv) Aframax-size range of approximately 80,000 to 120,000 dwt; (v)
Panamax-size range of approximately  60,000 to 70,000 dwt; and (v) small tankers
of less than approximately 60,000 dwt. ULCCs and VLCCs typically transport crude
oil in long-haul trades, such as from the Arabian Gulf to Rotterdam via the Cape
of Good Hope.  Suezmax tankers also engage in long-haul crude oil trades as well
as in medium-haul  crude oil trades,  such as from West Africa to the East Coast
of the United States.  Aframax-size  vessels generally engage in both medium-and
short-haul  trades of less than  1,500  miles and carry  crude oil or  petroleum
products.  Smaller tankers mostly transport  petroleum products in short-haul to
medium-haul trades.

The Tanker Market 2004

         Tanker  freight  rates in 2004 were  significantly  higher  than in the
previous  high  periods in 2000 and 2003.  In the single  voyage  market,  VLCCs
achieved an average of close to $90,000 per day  compared to the $50,000 per day
level in the two previous peak years.  For the year as a whole  Suezmax  tankers
reached an average of $65,000 per day, significantly higher than the $40,000 per
day obtained in 2000 and in 2003.

         Based on export volume data, estimates indicate an increase in seaborne
oil trade of 6% from 2003 to 2004.  Average transport distance rose by 1%. There
seems to have been a small  improvement in productivity due to the modernization
of the tanker fleet and a reduction in waiting days in the  Bosphorus  from 2003
to 2004. Accordingly, tonnage demand increased by 6.5%.

         The active  tanker fleet rose by 3.7% from 2003 to 2004,  calculated on
an annual average basis,  resulting in an increase in the utilization  rate from
89% in 2003 to 91.5% in 2004,  the  highest  level  recorded  in the last  three
decades.  Freight rates in 2004 fluctuated wildly, a logical consequence of such
a record high utilization rate level.

         The active VLCC fleet  increased by 2%, while the Suezmax fleet rose by
5%.  Deliveries  of new  tankers  reached 27 million  dwt in 2004,  down from 30
million dwt in 2003.  Removals amounted to 10 million dwt in 2004 compared to an
average of 19 million dwt in the previous four years.  Removals are based on the
point in time vessels are actually removed from the market and not when reported
sold for scrapping or for conversions.

         Some 8 million  dwt were sold for  scrapping  in 2004 and 2 million dwt
were sold for conversion. The average age for all tankers sold for scrapping was
27.3 years in 2004, compared to 26.6 years in 2003.

         As a result of the extremely  strong dry bulk market,  2 million dwt of
combined  carriers  moved from oil  trades to dry  trades  from 2003 to 2004 and
limited the fleet growth in oil transportation.

         The highest  global  economic  growth since 1976  stimulated  world oil
consumption,  which rose by 3.4% in 2004.  This is the highest  oil  consumption
growth rate since the 1970s.  Global oil production  climbed an exceptional 4.5%
resulting in a moderate  building of oil inventories.  OPEC raised its crude oil
production  by more than 7% and reached a peak of more than 30 mbd in the fourth
quarter of the year. This was very close to its production capacity,  leading to
a 35% surge in crude oil  prices  from 2003 to 2004.  The  strong  growth in oil
consumption despite the sharp rise in oil prices may be attributed, in parts, to
heavy  subsidization  of end-user  prices in many of the  countries  with strong
consumption growth.

         The main driver  behind  these strong  freight  market  conditions  was
China, with its strong growth in oil consumption and imports.  In the first half
of 2004, Chinese oil consumption was 22% higher than in the same period the year
before. Oil imports rose by more than 30% for the second year in a row.

         2004 was also a  record-breaking  year in the vessel sale and  purchase
market with regard to transaction volumes as well as ship market values.  During
2004, tankers monitored by R.S. Platou Shipbrokers  increased in market value by
some 45% (20% in 2003).  Double hull tankers rose by 40% (25%),  whereas  single
hull tankers were up between 35% and 75%.

Environmental and Other Regulation

         Government regulation significantly affects the ownership and operation
of our tankers. They are subject to international  conventions,  national, state
and local laws and  regulations  in force in the  countries in which our vessels
may operate or are registered.

         A variety of governmental  and private  entities subject our vessels to
both scheduled and  unscheduled  inspections.  These entities  include the local
port authorities (U.S. Coast Guard, harbor master or equivalent), classification
societies,  flag state  administration  (country of  registry)  and  charterers,
particularly  terminal  operators and oil  companies.  Certain of these entities
require us to obtain permits, licenses and certificates for the operation of our
tankers.  Failure to maintain necessary permits or approvals could require us to
incur substantial  costs or temporarily  suspend operation of one or more of our
vessels.

         We believe  that the  heightened  level of  environmental  and  quality
concerns among insurance  underwriters,  regulators and charterers is leading to
greater inspection and safety requirements on all vessels and may accelerate the
scrapping of older vessels  throughout  the industry.  Increasing  environmental
concerns  have  created  a demand  for  vessels  that  conform  to the  stricter
environmental standards. We are required to maintain operating standards for all
of our vessels that will  emphasize  operational  safety,  quality  maintenance,
continuous  training of our  officers  and crews and  compliance  with U.S.  and
international  regulations.  We believe that the  operation of our vessels is in
substantial  compliance  with  applicable  environmental  laws and  regulations;
however, because such laws and regulations are frequently changed and may impose
increasingly  stricter  requirements,  such  future  requirements  may limit our
ability to do business, increase our operating costs, force the early retirement
of our vessels,  and/or  affect their  resale  value,  all of which could have a
material adverse effect on our financial condition and results of operations.

Environmental Regulation--IMO

         In 1992, the International  Maritime  Organization,  or IMO (the United
Nations  agency for maritime  safety and the  prevention of marine  pollution by
ships),  adopted  regulations that set forth pollution  prevention  requirements
applicable to tankers.  These regulations,  which have been adopted by more than
150 nations,  including many of the  jurisdictions in which our tankers operate,
provide, in part, that:

            o   tankers  between  25 and 30  years  old  must be of  double-hull
                construction   or  of  a  mid-deck   design  with  double  sided
                construction,  unless (1) they have wing tanks or  double-bottom
                spaces not used for the  carriage  of oil,  which cover at least
                30% of the  length  of the  cargo  tank  section  of the hull or
                bottom;  or (2) they are  capable  of  hydrostatically  balanced
                loading  (loading  less cargo into a tanker so that in the event
                of a breach of the hull, water flows into the tanker, displacing
                oil upwards instead of into the sea);

            o   tankers   30  years  old  or  older   must  be  of   double-hull
                construction or mid-deck design with double sided  construction;
                and

            o   all tankers are subject to enhanced inspections.

         Also,  under  IMO   regulations,   a  tanker  must  be  of  double-hull
construction  or a mid-deck  design  with  double  sided  construction  or be of
another  approved  design  ensuring  the same level of  protection  against  oil
pollution if the tanker:

            o   is the subject of a contract for a major  conversion or original
                construction on or after July 6, 1993;

            o   commences  a major  conversion  or has its keel laid on or after
                January 6, 1994; or

            o   completes a major conversion or is a newbuilding delivered on or
                after July 6, 1996.

         Effective  September 2002, the IMO  accelerated its existing  timetable
for the phase-out of  single-hull  oil tankers.  These  regulations  require the
phase-out of most  single-hull oil tankers by 2015 or earlier,  depending on the
age of the tanker and whether it has segregated  ballast tanks.  After 2007, the
maximum  permissible  age for single-hull  tankers will be 26 years.  Compliance
with the new regulations  regarding inspections of all tankers,  however,  could
adversely affect our operations.  Under current  regulations,  retrofitting will
enable  a  tanker  to  operate  until  the  earlier  of 25  years of age and the
anniversary date of its delivery in 2017.  However, as a result of the oil spill
in November 2002 relating to the loss of the M/T Prestige,  which was owned by a
company  not  affiliated  with us, in  December  2003 the  Marine  Environmental
Protection   Committee   of  the  IMO  adopted  a  proposed   amendment  to  the
International   Convention  for  the  Prevention  of  Pollution  from  Ships  to
accelerate  the phase out of  single-hull  tankers  from 2015 to 2010 unless the
relevant  flag state,  in a  particular  case,  extends  the date to 2015.  This
amendment came into effect in April 2005.

         The IMO has  also  negotiated  international  conventions  that  impose
liability  for  oil  pollution  in   international   waters  and  a  signatory's
territorial  waters.  In  September  1997,  the  IMO  adopted  Annex  VI to  the
International  Convention  for the Prevention of Pollution from Ships to address
air pollution from ships. Annex VI was ratified in May 2004 and became effective
in May 2005.  Annex VI sets limits on sulfur oxide and nitrogen oxide  emissions
from  ship  exhausts  and  prohibit  deliberate  emissions  of  ozone  depleting
substances, such as chlorofluorocarbons.  Annex VI also includes a global cap on
the sulfur  content of fuel oil and allows for special  areas to be  established
with more stringent  controls on sulfur  emissions.  We believe that  compliance
with the Annex VI  regulations  will have no  material  effect on our results of
operations.  Additional or new conventions,  laws and regulations may be adopted
that could adversely affect our ability to manage our ships.

         Under  the   International   Safety   Management  Code,  or  ISM  Code,
promulgated  by the IMO,  the  party  with  operational  control  of a vessel is
required to develop an extensive safety management  system that includes,  among
other  things,  the  adoption of a safety and  environmental  protection  policy
setting forth  instructions  and procedures for operating its vessels safely and
describing  procedures  for  responding  to  emergencies.  We will rely upon the
safety  management  system that we and our third party  technical  managers have
developed.

         The ISM Code requires that vessel operators obtain a safety  management
certificate for each vessel they operate.  This certificate evidences compliance
by a vessel's  management with code requirements for a safety management system.
No vessel  can  obtain a  certificate  unless  its  manager  has been  awarded a
document of compliance,  issued by each flag state,  under the ISM Code. We have
the  requisite  documents of  compliance  for our offices and safety  management
certificates  for all of our tankers for which the  certificates are required by
the IMO. We are  required  to renew these  documents  of  compliance  and safety
management certificates annually.

         Noncompliance  with the ISM Code and other IMO  regulations may subject
the  shipowner  or  bareboat  charterer  to  increased  liability,  may  lead to
decreases in available insurance coverage for affected vessels and may result in
the denial of access to, or  detention  in, some ports.  For  example,  the U.S.
Coast Guard and European  Union  authorities  have indicated that vessels not in
compliance  with  the ISM Code  will be  prohibited  from  trading  in U.S.  and
European Union ports.

         Although the United  States is not a party to these  conventions,  many
countries have ratified and follow the liability plan adopted by the IMO and set
out in the International  Convention on Civil Liability for Oil Pollution Damage
of 1969. Under this convention,  if the country in which the damage results is a
party to the 1992 Protocol to the  International  Convention on Civil  Liability
for Oil Pollution  Damage,  a vessel's  registered  owner is strictly liable for
pollution  damage caused in the  territorial  waters of a  contracting  state by
discharge of persistent  oil,  subject to certain  complete  defenses.  Under an
amendment to the Protocol that became effective on November 1, 2003, for vessels
of 5,000 to 140,000  gross tons (a unit of  measurement  for the total  enclosed
spaces within a vessel), liability is limited to approximately $6.5 million plus
$909 for each additional gross ton over 5,000. For vessels of over 140,000 gross
tons,  liability is limited to approximately  $129.3 million.  As the convention
calculates liability in terms of a basket of currencies, these figures are based
on currency  exchange  rates on May 10,  2004.  The right to limit  liability is
forfeited  under  the  International  Convention  on  Civil  Liability  for  Oil
Pollution Damage where the spill is caused by the owner's actual fault and under
the 1992  Protocol  where  the spill is caused  by the  owner's  intentional  or
reckless  conduct.   Vessels  trading  to  states  that  are  parties  to  these
conventions  must provide  evidence of insurance  covering the  liability of the
owner. In jurisdictions  where the  International  Convention on Civil Liability
for Oil Pollution Damage has not been adopted,  various  legislative  schemes or
common law govern, and liability is imposed either on the basis of fault or in a
manner similar to that convention.  We believe that our P&I insurance will cover
the liability under the plan adopted by the IMO.

U.S.  Oil  Pollution  Act of  1990  and  Comprehensive  Environmental  Response,
Compensation and Liability Act

         The United  States  regulates  the tanker  industry  with an  extensive
regulatory and liability regime for environmental  protection and cleanup of oil
spills,  consisting primarily of the U.S. Oil Pollution Act of 1990, or OPA, and
the  Comprehensive  Environmental  Response,  Compensation and Liability Act, or
CERCLA. OPA affects all owners and operators whose vessels trade with the United
States or its territories or possessions, or whose vessels operate in the waters
of the  United  States,  which  include  the  U.S.  territorial  sea and the 200
nautical mile exclusive  economic zone around the United States.  CERCLA applies
to the discharge of hazardous  substances (other than oil) whether on land or at
sea. Both OPA and CERCLA impact our operations.

         Under  OPA,  vessel  owners,  operators  and  bareboat  charterers  are
"responsible parties" who are jointly, severally and strictly liable (unless the
spill results solely from the act or omission of a third party, an act of God or
an act of war) for all  containment and clean-up costs and other damages arising
from oil spills from their vessels.  These other damages are defined  broadly to
include:

            o   natural resource damages and related assessment costs;

            o   real and personal property damages;

            o   net  loss  of  taxes,  royalties,  rents,  profits  or  earnings
                capacity;

            o   net cost of public  services  necessitated  by a spill response,
                such as protection from fire, safety or health hazards; and

            o   loss of subsistence use of natural resources.

         OPA limits  the  liability  of  responsible  parties to the  greater of
$1,200 per gross ton or $10  million  per tanker  that is over 3,000  gross tons
(subject to possible  adjustment for inflation).  The act  specifically  permits
individual  states to impose  their own  liability  regimes  with  regard to oil
pollution  incidents  occurring  within their  boundaries,  and some states have
enacted   legislation   providing  for  unlimited  liability  for  discharge  of
pollutants  within their  waters.  In some cases,  states that have enacted this
type of legislation have not yet issued implementing regulations defining tanker
owners'  responsibilities  under these laws. CERCLA, which applies to owners and
operators  of tankers,  contains a similar  liability  regime and  provides  for
cleanup and removal of hazardous  substances and for natural  resource  damages.
Liability  under  CERCLA is limited  to the  greater of $300 per gross ton or $5
million.

         These limits of liability do not apply, however,  where the incident is
caused by violation of applicable U.S. federal safety, construction or operating
regulations,   or  by  the  responsible  party's  gross  negligence  or  willful
misconduct.  These limits do not apply if the responsible party fails or refuses
to report  the  incident  or to  cooperate  and  assist in  connection  with the
substance removal activities.  OPA and CERCLA each preserve the right to recover
damages under existing law, including maritime tort law.

         OPA also  requires  owners and  operators of vessels to  establish  and
maintain  with  the  U.S.  Coast  Guard  evidence  of  financial  responsibility
sufficient to meet the limit of their potential  strict liability under the act.
The U.S.  Coast Guard has enacted  regulations  requiring  evidence of financial
responsibility  in the amount of $1,500 per gross ton for tankers,  coupling the
OPA  limitation  on liability of $1,200 per gross ton with the CERCLA  liability
limit of $300 per gross ton.  Under these  regulations,  an owner or operator of
more than one tanker is required to obtain a certificate of  responsibility  for
each vessel in the fleet in an amount equal only to the financial responsibility
requirement of the tanker having the greatest maximum strict liability under OPA
and CERCLA. We have provided evidence of financial responsibility in the form of
guarantees  issued by a guarantor  approved by the U.S. Coast Guard and received
certificates of financial  responsibility  from the U.S. Coast Guard for each of
our vessels that calls in U.S. waters.

         We insure each of our vessels with pollution liability insurance in the
maximum commercially available amount of $1.0 billion per incident per vessel. A
catastrophic spill could exceed the insurance coverage available, in which event
there could be a material adverse effect on our business.

         OPA also  amended the Federal  Water  Pollution  Control Act to require
owners or operators of tankers  operating in the waters of the United  States to
file vessel  response  plans with the U.S.  Coast Guard,  and their  tankers are
required to operate in compliance  with their U.S. Coast Guard  approved  plans.
These response plans must, among other things:

            o   address a "worst case" scenario and identify and ensure, through
                contract or other approved means,  the availability of necessary
                private   response   resources  to  respond  to  a  "worst  case
                discharge";

            o   describe crew training and drills; and

            o   identify a qualified individual with full authority to implement
                removal actions.

         Vessel  response  plans for our tankers  operating in the waters of the
United States have been approved by the U.S. Coast Guard. In addition,  the U.S.
Coast Guard has announced it intends to propose  similar  regulations  requiring
certain  vessels  to  prepare  response  plans  for  the  release  of  hazardous
substances.  We are  responsible  for  ensuring  our  vessels  comply  with  any
additional regulations.

         OPA  does  not  prevent  individual  states  from  imposing  their  own
liability regimes with respect to oil pollution incidents occurring within their
boundaries.  In fact,  most U.S.  states that border a navigable  waterway  have
enacted  environmental  pollution laws that impose strict  liability on a person
for removal costs and damages  resulting from a discharge of oil or a release of
a hazardous substance. These laws may be more stringent than U.S. federal law.

European Union Tanker Restrictions

         In July 2003,  in  response to the M/T  Prestige  oil spill in November
2002, the European  Union adopted  legislation  that  prohibits all  single-hull
tankers from entering into its ports or offshore terminals by 2010. The European
Union has also banned all single-hull  tankers carrying heavy grades of oil from
entering or leaving its ports or offshore  terminals or anchoring in areas under
its jurisdiction. Commencing in 2005, certain single-hull tankers above 15 years
of age will also be restricted from entering or leaving  European Union ports or
offshore terminals and anchoring in areas under European Union jurisdiction. The
European Union is also  considering  legislation  that would: (1) ban manifestly
sub-standard  vessels  (defined  as those  more than 15 years old that have been
detained by port authorities at least twice in a six month period) from European
waters and create an obligation of port states to inspect  vessels posing a high
risk to maritime safety or the marine environment;  and (2) provide the European
Union  with  greater  authority  and  control  over  classification   societies,
including  the ability to seek to suspend or revoke the  authority  of negligent
societies.  The sinking of the M/T Prestige and  resulting oil spill in November
2002 has led to the  adoption  of other  environmental  regulations  by  certain
European Union nations,  which could adversely affect the remaining useful lives
of all of our tankers and our ability to generate income from them. For example,
Italy announced a ban of single-hull  crude oil tankers over 5,000 dwt from most
Italian ports,  effective April 2001. Spain has announced a similar prohibition.
It is impossible to predict what legislation or additional regulations,  if any,
may be promulgated by the European Union or any other country or authority.

Vessel Security Regulations

         Since the terrorist  attacks of September  11, 2001,  there have been a
variety of  initiatives  intended to enhance  vessel  security.  On November 25,
2002, the Maritime  Transportation Security Act of 2002 (MTSA) came into effect.
To implement  certain  portions of the MTSA, in July 2003,  the U.S. Coast Guard
issued regulations requiring the implementation of certain security requirements
aboard  vessels  operating in waters subject to the  jurisdiction  of the United
States.  Similarly, in December 2002, amendments to the International Convention
for the Safety of Life at Sea (SOLAS)  created a new  chapter of the  convention
dealing specifically with maritime security. The new chapter went into effect in
July 2004 and imposes various detailed security  obligations on vessels and port
authorities, most of which are contained in the newly created International Ship
and Port  Facilities  Security  (ISPS) Code. We are in compliance  with the ISPS
Code. Among the various requirements are:

            o   on-board  installation of automatic information systems, or AIS,
                to enhance vessel-to-vessel and vessel-to-shore communications;

            o   on-board installation of ship security alert systems;

            o   the development of vessel security plans; and

            o   compliance with flag state security certification requirements.

         The U.S. Coast Guard regulations,  intended to align with international
maritime security standards,  exempt non-U.S.  tankers from MTSA vessel security
measures  provided  such  vessels  have  on  board,  by July  1,  2004,  a valid
International  Ship  Security  Certificate  (ISSC) that  attests to the vessel's
compliance with SOLAS security requirements and the ISPS Code. We will implement
the various security measures addressed by the MTSA, SOLAS and the ISPS Code and
ensure  that  our  tankers  attain  compliance  with  all  applicable   security
requirements  within  the  prescribed  time  periods.  We do not  believe  these
additional requirements will have a material financial impact on our operations.

Inspection by Classification Societies

         Every seagoing  vessel must be "classed" by a  classification  society.
The  classification  society certifies that the vessel is "in class," signifying
that the vessel has been built and  maintained in  accordance  with the rules of
the classification society and complies with applicable rules and regulations of
the vessel's country of registry and the international conventions of which that
country is a member.  In addition,  where surveys are required by  international
conventions  and  corresponding  laws  and  ordinances  of  a  flag  state,  the
classification  society will undertake them on application or by official order,
acting on behalf of the authorities concerned.

         The classification society also undertakes on request other surveys and
checks that are  required by  regulations  and  requirements  of the flag state.
These surveys are subject to agreements  made in each  individual case and/or to
the regulations of the country concerned.

         For  maintenance  of the class,  regular and  extraordinary  surveys of
hull,  machinery,  including the  electrical  plant,  and any special  equipment
classed are required to be performed as follows:

         Annual Surveys:  For seagoing  ships,  annual surveys are conducted for
the hull and the machinery, including the electrical plant, and where applicable
for  special  equipment  classed,  at  intervals  of 12 months  from the date of
commencement of the class period indicated in the certificate.

         Intermediate  Surveys:  Extended  annual  surveys  are  referred  to as
intermediate  surveys and typically  are conducted two and one-half  years after
commissioning and each class renewal. Intermediate surveys may be carried out on
the occasion of the second or third annual survey.

         Class Renewal  Surveys:  Class renewal  surveys,  also known as special
surveys,  are  carried  out  for  the  ship's  hull,  machinery,  including  the
electrical  plant,  and for any  special  equipment  classed,  at the  intervals
indicated  by the  character  of  classification  for the hull.  At the  special
survey, the vessel is thoroughly examined,  including audio-gauging to determine
the thickness of the steel structures.  Should the thickness be found to be less
than class  requirements,  the  classification  society  would  prescribe  steel
renewals.  The  classification  society  may grant a one-year  grace  period for
completion of the special  survey.  Substantial  amounts of money may have to be
spent for steel  renewals  to pass a special  survey if the  vessel  experiences
excessive wear and tear. In lieu of the special survey every four or five years,
depending on whether a grace period was granted,  a shipowner  has the option of
arranging with the classification  society for the vessel's hull or machinery to
be on a  continuous  survey  cycle,  in which every part of the vessel  would be
surveyed within a five-year cycle.

         At an owner's  application,  the surveys required for class renewal may
be split  according  to an agreed  schedule to extend over the entire  period of
class. This process is referred to as continuous class renewal.

         All areas  subject to survey as defined by the  classification  society
are  required  to be  surveyed at least once per class  period,  unless  shorter
intervals  between  surveys are  prescribed  elsewhere.  The period  between two
subsequent surveys of each area must not exceed five years.

         Most vessels are also  dry-docked  every 30 to 36 months for inspection
of the underwater  parts and for repairs related to inspections.  If any defects
are found, the classification  surveyor will issue a "recommendation" which must
be rectified by the ship owner within prescribed time limits.

         Most insurance  underwriters make it a condition for insurance coverage
that a vessel be certified as "in class" by a classification  society which is a
member of the  International  Association of Classification  Societies.  All our
vessels are certified as being "in class" by Lloyd's Register of Shipping (three
vessels) and Det norske Veritas (three vessels).  All new and secondhand vessels
that we purchase must be certified  prior to their  delivery  under our standard
contracts and  memorandum  of  agreement.  If the vessel is not certified on the
date of closing, we have no obligation to take delivery of the vessel.

Risk of Loss and Liability Insurance

         The  operation of any cargo vessel  includes  risks such as  mechanical
failure,   collision,   property  loss,   cargo  loss  or  damage  and  business
interruption due to political  circumstances in foreign  countries,  hostilities
and labor  strikes.  In  addition,  there is always an inherent  possibility  of
marine disaster,  including oil spills and other environmental  mishaps, and the
liabilities  arising from owning and operating  vessels in international  trade.
OPA, which imposes  virtually  unlimited  liability  upon owners,  operators and
demise charterers of any vessel trading in the United States exclusive  economic
zone  for  certain  oil  pollution  accidents  in the  United  States,  has made
liability  insurance more expensive for ship owners and operators trading in the
United States market. While we carry loss of hire insurance to cover 100% of our
fleet, we may not be able to maintain this level of coverage. Furthermore, while
we believe that our present insurance coverage is adequate, not all risks can be
insured,  and there can be no guarantee that any specific claim will be paid, or
that we will always be able to obtain adequate  insurance coverage at reasonable
rates.

Hull and Machinery Insurance

         We have  obtained  marine hull and  machinery  and war risk  insurance,
which  includes the risk of actual or  constructive  total loss,  for all of the
vessels in our fleet.  The vessels in our fleet are each  covered up to at least
fair market value, with deductibles of $350,000 per vessel per incident. We also
arranged  increased  value coverage for each vessel.  Under this increased value
coverage,  in the event of total loss of a vessel,  we will be able  recover for
amounts not  recoverable  under the hull and  machinery  policy by reason of any
under-insurance.

Protection and Indemnity Insurance

         Protection and indemnity insurance is provided by mutual protection and
indemnity  associations,  or P&I  Associations,  which  covers  our third  party
liabilities  in connection  with our shipping  activities.  This includes  third
party  liability  and  other  related  expenses  of  injury  or  death  of crew,
passengers and other third parties, loss or damage to cargo, claims arising from
collisions with other vessels,  damage to other third party property,  pollution
arising  from oil or other  substances,  and salvage,  towing and other  related
costs, including wreck removal.  Protection and indemnity insurance is a form of
mutual  indemnity  insurance,   extended  by  protection  and  indemnity  mutual
associations,  or  "clubs."  Subject  to  the  "capping"  discussed  below,  our
coverage, except for pollution, is unlimited.

         Our current  protection and indemnity  insurance coverage for pollution
is $1 billion  per vessel per  incident.  The  fourteen  P&I  Associations  that
comprise  the  International  Group  insure  approximately  90% of  the  world's
commercial  tonnage and have entered into a pooling  agreement to reinsure  each
association's liabilities.  Each P&I Association has capped its exposure to this
pooling agreement at $4.25 billion. As a member of a P&I Association, which is a
member of the  International  Group,  we are  subject  to calls  payable  to the
associations  based on its claim  records  as well as the claim  records  of all
other  members of the  individual  associations,  and members of the pool of P&I
Associations comprising the International Group.

Competition

         We operate in markets that are highly  competitive  and based primarily
on supply and  demand.  We compete for  charters  on the basis of price,  vessel
location, size, age and condition of the vessel, as well as on our reputation as
an operator. We arrange our time charters and voyage charters in the spot market
through the use of brokers,  who  negotiate  the terms of the charters  based on
market  conditions.  We compete  primarily with owners of tankers in the Suezmax
and Handymax  class  sizes.  Ownership  of tankers is highly  fragmented  and is
divided among major oil companies and independent vessel owners.

Legal Proceedings Against Us

         We are not involved in any legal  proceedings  which may have,  or have
had a  significant  effect on our  financial  position,  nor are we aware of any
proceedings that are pending or threatened  which may have a significant  effect
on our financial position.

C. ORGANIZATIONAL STRUCTURE

Prior to September 30, 1997, the Company was a wholly owned subsidiary of Ugland
Nordic  Shipping  ASA, or UNS, a Norwegian  shipping  company  whose shares were
listed on the Oslo Stock Exchange.  On September 30, 1997,  11,731,613  warrants
for the  purchase of the  Company's  common  shares,  which had been sold to the
public in 1995,  were  exercised.  Until May 30, 2003, UNS acted as the Manager,
and provided  managerial,  administrative  and advisory  services to the Company
pursuant to the Management  Agreement.  Since May 30, 2003, Scandic has acted as
the Company's  Manager,  and provides such services  pursuant to the  Management
Agreement,  as novated The Management  Agreement was amended on October 12, 2004
to  further  align  the  Manager's  interests  with  those of the  Company  as a
shareholder of the Company.. See Item 7.

D. PROPERTY, PLANT AND EQUIPMENT

         Other than the Vessels described  elsewhere in this filing, the Company
does not own or lease any tangible fixed property.

ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS

We present our income statement using voyage revenues and voyage  expenses.  The
Company's  vessels are  operated  under  bareboat  charters,  spot  related time
charters  and  spot  charters.  Under a  bareboat  charter  the  charterer  pays
substantially all of the vessel voyage and operating costs. Under a spot related
time charter,  the charterer pays  substantially all of the vessel voyage costs.
Under a spot charter,  the vessel owner pays all such costs. Vessel voyage costs
consist primarily of fuel, port charges and commissions.

Since the amount of voyage  expenses that we incur for a charter  depends on the
type of the charter,  we use net voyage revenues to provide  comparability among
the  different  types of  charters.  Net voyage  revenue,  a non-GAAP  financial
measure,  provides more  meaningful  disclosure than voyage  revenues,  the most
directly  comparable  financial  measure under accounting  principles  generally
accepted  in the United  States  ("GAAP").  Net voyage  revenues  divided by the
number of days on the charter  provides the Time Charter  Equivalent (TCE) Rate.
For bareboat  charters  operating  costs must be added in order to calculate TCE
rates.  Net voyage  revenues  and TCE rates are  widely  used by  investors  and
analysts in the tanker shipping industry for comparing the financial performance
of companies and for preparing industry averages. The following table reconciles
our net voyage  revenues to voyage  revenues.  Note:  in 2004,  our  calculation
methodology  for net voyage  revenues was adjusted to better reflect the various
commission  schemes  under which we operate.  Prior period TCE amounts have been
adjusted to conform with the 2004 reconciliation.

<TABLE>
<CAPTION>
                                              Year Ended     Year Ended      Year Ended
                                            December 31,    December 31,     December 31,
                                               2004           2003             2002
---------------------------------------------------------------------------------------------
<S>                                       <C>                 <C>             <C>
Voyage Revenue                            67,451,598          37,370,756      18,057,989
Voyage Expenses                           (4,925,353)          (184,781)       (184,781)
---------------------------------------------------------------------------------------------
Net Voyage Revenue                        62,526,245          37,185,975      17,873,208
---------------------------------------------------------------------------------------------
</TABLE>

YEAR ENDED DECEMBER 31, 2004 VERSUS YEAR ENDED DECEMBER 31, 2003

         Voyage  revenues  increased  by 80.5%  to  $67,451,598  in  2004,  from
$37,370,756  in 2003. Net voyage  revenues  increased by 68.1% to $62,526,245 in
2004,  from  $37,185,975  in 2003. The increase in net voyage revenue was due to
higher  tanker  spot  market  rates in the twelve  month  period in 2004 and the
addition of one vessel on November  23,  2004.  The tanker spot market rates are
determined  by the demand for the carriage of oil and the distance the oil is to
be carried, measured in tonne miles, and the supply of vessels to transport that
oil. As a result of the strong  spot market  rates  during  2004,  our TCE rates
increased 46.6% to $62,231 for 2004, from $42,460 for 2003.

         Vessel  operating  expenses  were  $1,976,766  for  2004.  There are no
comparable  figures for 2003. The Company did not have vessel operating expenses
for the  comparable  period of 2003 since all the vessels  were  chartered to BP
Shipping under bareboat charter  agreements.  Under bareboat charter  agreements
all vessels operating expenses are paid by the charterer.

         Administrative  expenses  increased by 2,218% to  $10,851,688  in 2004,
from $468,087 in 2003. The increase is primarily due to  share-based  expense of
$9,252,365,  which  results  from a change in the  compensation  scheme  for our
Manager,  Scandic American Shipping Ltd. The management agreement was amended in
2004 from a cash commission  structure based on charter revenue to a share-based
structure that provides 2% of the Company's  outstanding  shares to the Manager.
Other  administrative  costs have  increased as a result of the transition to an
operating  company.  In 2004,  the  Company  engaged  the  Manager to assume the
commercial  and  operational  responsibility  of our  vessels  and to manage our
day-to-day  business.  This agreement is based on cost incurred plus a fixed fee
of  $100,000.  Until June 30,  2004,  the  Company  paid an annual  fixed fee of
$250,000 for these  services.  Furthermore,  the Company hired a Chief Executive
Officer, Herbj0rn Hansson in 2004.

         Net  operating  income for 2004  increased  43.1%  from the  comparable
period  in 2003 from  $29,886,849  to  $42,779,627  primarily  due to  increased
revenue offset by increased costs as described above.

YEAR ENDED DECEMBER 31, 2003 VERSUS YEAR ENDED DECEMBER 31, 2002

         Voyage  revenues  increased  by 106.9%  to  $37,370,756  in 2003,  from
$18,057,989 in 2002. Net voyage  revenues  increased by 108.1% to $37,185,975 in
2003,  from  $17,873,208  in 2002. The increase in net voyage revenue was due to
higher  tanker  spot market  rates in 2004 than in 2003.  The tanker spot market
rates are  determined by the demand for the carriage of oil and the distance the
oil is to be  carried,  measured  in tonne  miles,  and the supply of vessels to
transport  that oil. The TCE rates  increased by 71.0% to $42,460 in 2003,  from
$24,823 in 2002.

         Market  rates which are used to  determine  additional  hire  increased
significantly  in 2003. The strong tanker market was driven by very cold weather
at start of the year  combined  with  very  high  natural  gas  prices  in North
America.  Strong demand  increases in China alongside  economic  recovery in the
United States supported the growth in oil demand throughout the year. Additional
hire by quarter,  as  determined by the Brokers  Panel was  $22,588,256  for the
first through the fourth quarters of 2003 respectively.

         Management,  insurance and administrative costs ("MI&A") for 2003, 2002
and 2001 were $652,868,  $611,829 and $538,520 respectively.  The Company's MI&A
for all three years  consisted  of ship  brokers  commissions  of  approximately
$185,000 and management fees of $250,000 which are fixed.  The increase in costs
of  $41,039  from  2002 to 2003 is  mainly  due to  higher  insurance  costs and
attorney  fees.  Depreciation  expense  approximated  $6,831,040 for each of the
three years.

A.  LIQUIDITY AND CAPITAL RESOURCES

         Cash  flows  provided  by  operating   activities   were   $62,817,261,
$29,893,551 and $12,750,908 in 2004, 2003 and 2002,  respectively.  The majority
of the increases resulted from higher cash flows related to net voyage revenues.
The  cash  flows  from  customers   less  payments  for  voyage   expenses  were
$67,415,268,  $32,320,191 and 14,766,865 in 2004,  2003 and 2002,  respectively.
The  increase  in cash flows were  offset by an increase in cash paid for vessel
operations of $1,925,508 in 2004.

         Cash flows provided by financing  activities  for 2004 was  $33,486,608
compared  to cash flows used of  $29,605,410  for the same  period in 2003.  The
increase was due to (i)  proceeds  from a follow-on  offering of $112.1  million
offset by (ii)  increased  dividends  paid  from 2003 to 2004 of $17.6  million,
(iii)  repayment of $30 million in bank debt and (iv)  payment of loan  facility
costs of $1.5 million in respect of our $300 million credit facility.

         Cash flow used by investing activities was $66,137,277 which represents
the  acquisition  cost of the vessel  acquired in November  2004.  There were no
investing activities for the comparable period of 2003.

         In March 2005, the Company sold 3,500,000  shares in a public  offering
in the US to fund the $149.2  million  acquisition  costs of two  vessels and to
repay  outstanding  amount on the credit  facility.  The  offering was priced at
$49.50 per share,  and net proceeds  (after offering costs of $ 11.1 million) to
the Company were $162.1 million.

         In June  2005,  the  Company  agreed to acquire a double  hull  suezmax
tanker built in 1998 for $71.4  million.  The vessel is expected to be delivered
from the seller to the Company no later than end August 2005. The Company has an
unused credit facility of $300 million at June 30, 2005.

         The  Company  believes  that its  borrowing  capacity  under the credit
facility,  together with its working  capital are sufficient to fund its ongoing
operations and commitments for capital expenditures.

Dividend payment

         Total  dividends  paid in 2004 were  $47,195,842  or $4.84  per  share.
Dividend payments per share in 2002, 2003 and 2004 have been as follows:


Period                      2002          2003          2004
-------------------------------------------------------------
1st Quarter                 $0.36         $0.36         $1.15
2nd Quarter                  0.34          1.27          1.70
3rd Quarter                  0.33          0.78          0.88
4th Quarter                  0.32          0.37          1.11
-------------------------------------------------------------

Total USD                   $1.35         $3.05         $4.84
-------------------------------------------------------------

         The  Company  declared  a  dividend  of $1.62  per  share for the first
quarter of 2005 which was paid to  shareholders  in February  2005. In addition,
the  Company  declared a dividend  of $1.15 per share for the second  quarter of
2005, which was paid to shareholders in May 2005.

B. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.

                  Not applicable

C. TREND INFORMATION

         The  oil  tanker  industry  has  been  highly  cyclical,   experiencing
volatility in charterhire  rates and vessel values resulting from changes in the
supply of and demand for crude oil and tanker capacity.  See Item 4. Information
on the Company - Business Overview - The Tanker Market 2004.

D. OFF BALANCE SHEET ARRANGEMENTS

                  Not applicable

E. TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS

         The  Company  does  not  have  contractual  obligations  or  commercial
commitments.

CRITICAL ACCOUNTING POLICIES

Long-lived assets

A significant  part of the Company's total assets  consists of the Vessels.  The
oil tanker  market is highly  cyclical  and the useful  lives of the Vessels are
dependent on factors,  such as future  market  demand for oil and future  market
supply of tanker capacity.

Depreciable lives

 Management uses  considerable  judgment when establishing the depreciable lives
of the Vessels.  In order to estimate  useful  lives of the Vessels,  Management
must make assumptions  about future market  conditions in the oil tanker market.
The Company  considers the  establishment of depreciable  lives to be a critical
accounting estimate.

Impairment

The Vessels are  evaluated  for  impairment  whenever  indicators  of impairment
exist.  When an  impairment  indicator  is present,  the Company  must  evaluate
whether the carrying  amounts of the Vessels are  recoverable.  If an impairment
test is warranted,  we assess whether the undiscounted cash flows expected to be
generated  by our  long-lived  assets  exceed  their  carrying  value.  If  this
assessment  indicates  that the long-lived  assets are impaired,  the assets are
written down to their fair value.  These  assessments are based on our judgment,
which includes the estimate of future cash flows from long-lived assets.

RECENT ACCOUNTING PRONOUNCEMENTS

In December  2004,  the FASB issued SFAS No. 123  (revised  2004),  "Share-Based
Payment"  ("SFAS 123R"),  which replaces SFAS No. 123 and supercedes APB Opinion
No. 25,  "Accounting  for Stock  Issued to  Employees."  SFAS 123R  requires all
share-based  payments to employees,  including grants of employee stock options,
to be  recognized  in the  financial  statements  based  on  their  fair  values
beginning with the first annual period after June 15, 2005,  with early adoption
encouraged.  Under SFAS 123R,  the Company must determine the  appropriate  fair
value model to be used for valuing share-based payments, the amortization method
for compensation  cost and the transition method to be used at date of adoption.
The Company is  currently  evaluating  the effect that the adoption of SFAS 123R
will have on its results of  operations  and  financial  condition  but does not
expect it to have a material impact.

 In December  2004,  the FASB issued SFAS No.  153,  "Exchanges  of  Nonmonetary
Assets--An   Amendment  of  APB  Opinion  No.  29,  Accounting  for  Nonmonetary
Transactions"  ("SFAS 153").  SFAS 153  eliminates the exception from fair value
measurement for nonmonetary  exchanges of similar productive assets in paragraph
21(b) of APB Opinion No. 29,  "Accounting  for  Nonmonetary  Transactions,"  and
replaces  it  with an  exception  for  exchanges  that  do not  have  commercial
substance.  SFAS  153  specifies  that a  nonmonetary  exchange  has  commercial
substance  if the  future  cash  flows of the  entity  are  expected  to  change
significantly as a result of the exchange.  SFAS 153 is effective for the fiscal
periods  beginning after June 15, 2005. The Company is currently  evaluating the
effect that the adoption of SFAS 153 will have on its results of operations  and
financial condition but does not expect it to have a material impact.

ITEM 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A. DIRECTORS AND SENIOR MANAGEMENT

Directors and Senior Management of the Company and the Manager

         Pursuant to the Management  Agreement,  with Scandic American  Shipping
Ltd.,  or the  Manager,  the Manager  provides  management,  administrative  and
advisory services to us. The Manager is owned by Herbj0rn Hansson, our Chairman,
and  Andreas  Ove  Ugland,  one of our  directors,  and may  engage in  business
activities other than with respect to the Company.

         Set forth below are the names and  positions  of the  directors  of the
Company and executive officers of the Company and the Manager.  The directors of
the Company are elected annually, and each director elected holds office until a
successor  is elected.  Officers of both the Company and the Manager are elected
from time to time by vote of the  respective  board of directors and hold office
until a successor is elected.

                                   The Company

Name                            Age           Position
-------------------------------------------------------------------------------

Herbj0rn Hansson                 56   Chairman, Chief Executive
                                      Officer and President

Rolf Amundsen                    60   Chief Financial Officer

Hon. Sir David Gibbons           77    Director

George C. Lodge                  77    Director

Andreas Ove Ugland               49    Director

Torbj0rn Glads0                  57    Director

Peter Bubenzer                   49    Secretary

                                   The Manager


Name                            Age           Position
-------------------------------------------------------------------------------

Herbj0rn Hansson                 56    Director, President and Chief
                                       Executive Officer

Rolf Amundsen                    60    Chief Financial Officer

Jan Erik Langangen               54    Executive Vice President--
                                       Business Development and Legal

Turid M. S0rensen                44    Treasurer and Controller

         Certain  biographical  information  with  respect to each  director and
executive  officer of the  Company  and the  Manager  listed  above is set forth
below.

         Herbj0rn Hansson earned his M.B.A. at the Norwegian School of Economics
and Business Administration and Harvard Business School. In 1974 he was employed
by the Norwegian  Shipowners'  Association.  In the period from 1975 to 1980, he
was Chief Economist and Research Manager of INTERTANKO,  an industry association
whose members control about 75% of the world's independently owned tanker fleet,
excluding  state owned and oil company  fleets.  During the 1980s,  he was Chief
Financial  Officer  of  Kosmos/Andres  Jahre,  at the  time  one of the  largest
Norwegian  based shipping and industry  groups.  In 1989,  Mr.  Hansson  founded
Ugland  Nordic  Shipping  AS, or UNS,  which  became one of the world's  largest
owners of specialized  shuttle tankers. He served as Chairman in the first phase
and as  Chief  Executive  Officer  as from  1993 to 2001  when  UNS,  under  his
management,  was  sold to  Teekay  Shipping  Corporation,  or  Teekay,  for $780
million.  He continued to work with Teekay,  most  recently as Vice  Chairman of
Teekay  Norway  AS,  until he  started  working  full-time  for the  Company  on
September 1, 2004.  Mr.  Hansson is the founder and has been  Chairman and Chief
Executive  Officer of the Company since its  establishment in 1995. He also is a
member of various  governing  bodies of companies  within  shipping,  insurance,
banking,  manufacturing,   national/international  shipping  agencies  including
classification societies and protection and indemnity associations.  Mr. Hansson
is fluent in Norwegian  and English,  and has a command of German and French for
conversational purposes.

         Rolf Amundsen was  appointed  Chief  Financial  Officer by the Board of
Directors on June 10, 2004,  and has served as the  Investor  Relations  Officer
since  the  beginning  of 2004.  He has an  M.B.A.  in  economics  and  business
administration,  and  his  entire  career  has  been in  international  banking.
Previously,  Mr. Amundsen has served as the president of the financial  analysts
society in  Norway.  Mr.  Amundsen  served as the chief  executive  officer of a
Nordic  investment  bank for many years,  where he established a large operation
for the syndication of international shipping investments.

         Sir David  Gibbons has been a director of the Company  since  September
1995.  Sir David  served as the  Premier of Bermuda  from August 1977 to January
1982. Sir David has served as Chairman of The Bank of N.T.  Butterfield  and Son
Limited from 1986 to 1997,  Chairman of Colonial  Insurance Co. Ltd.  since 1986
and as Chief Executive Officer of Edmund Gibbons Ltd. since 1954.

         George C.  Lodge has been a director  of the  Company  since  September
1995.  Professor Lodge has been a member of the Harvard  Business School faculty
since 1963.  He was named  associate  professor  of business  administration  at
Harvard in 1968 and received tenure in 1972.

         Andreas Ove Ugland has been a director of the  Company  since  February
1997.   Mr.   Ugland  has  also  served  as  director  and  Chairman  of  Ugland
International  Holding plc, a  shipping/transport  company  listed on the London
Stock  Exchange,  Andreas  Ugland  & Sons AS,  Grimstad,  Norway,  H0egh  Ugland
Autoliners AS, Oslo and Buld Associates  Inc.,  Bermuda.  Mr. Ugland has had his
whole career in shipping in the Ugland family owned shipping  group.  Mr. Ugland
is a shareholder and the Chairman of the Manager.

         Torbj0rn  Glads0 has been a director of the Company since October 2003.
Mr.  Gladso  is a  partner  in  Saga  Corporate  Finance  AS.  He has  extensive
experience within investment banking since 1978. He has been the Chairman of the
Board of the Norwegian  Register of Securities and Vice Chairman of the Board of
Directors of the Oslo Stock Exchange.

         Jan  Erik   Langangen  is  the  Executive  Vice   President,   Business
Development and Legal, of the Manager.  Mr. Langangen  previously  served as the
Chief  Financial  Officer  from 1979 to 1983,  and as Chairman of the Board from
1987 to 1992,  of Statoil,  an oil and gas  company  that is  controlled  by the
Norwegian  government and that is the largest company in Norway.  He also served
as Chief Executive  Officer of UNI Storebrand  from 1985 to 1992. Mr.  Langangen
was also Chairman of the Board of the Norwegian  Governmental  Value  Commission
from 1998 to 2001. Mr. Langangen is a partner of Langangen & Helset, a Norwegian
law firm and previously was a partner of the law firm Langangen & Engesaeth from
1996 to 2000 and of the law firm Thune & Co.  from 1994 to 1996.  Mr.  Langangen
received  a  Masters  of  Economics  from  The  Norwegian   School  of  Business
Administration and his law degree from the University of Oslo.

         Turid M. S0rensen has a bachelor degree in Business Administration from
the Norwegian  School of Management.  Ms. S0rensen has 20 years of experience in
the  shipping  industry.  During  the period  from 1984 to 1987,  she worked for
Anders  Jahre AS and  Kosmos  AS in Norway  and held  various  positions  within
accounting  and  information  technology.  In the period from 1987 to 1995,  Ms.
S0rensen  was Manager of  Accounting  and IT for Skaugen  PertroTrans  Inc.,  in
Houston,  Texas.  After  returning to Norway she was  employed by Ugland  Nordic
Shipping ASA and Teekay Norway AS as Vice President, Accounting. Ms. S0rensen is
fluent in Norwegian and English.

The Management Agreement

         Under the  Management  Agreement  the Manager  assumes  commercial  and
operational  responsibility  of  our  vessels  and is  required  to  manage  our
day-to-day  business  subject,   always,  to  our  objectives  and  policies  as
established  from  time  to  time  by  the  Board  of  Directors.   The  Manager
sub-contracts  certain  of these  duties to IUM  Shipmanagement  AS,  or IUM,  a
third-party  technical manager  affiliated with Teekay Shipping  Corporation,  a
publicly traded shipping company.  All decisions of a material nature concerning
our business are reserved to the Board of Directors.  The  Management  Agreement
will  terminate  on June 30, 2014,  unless  earlier  terminated  pursuant to its
terms,  as  discussed  below,  or  extended  by  the  parties  following  mutual
agreement.

         For its  services  under  the  Management  Agreement,  the  Manager  is
entitled to a management fee equal to $100,000 per annum.  The management fee is
payable to the Manager quarterly in advance.  The Management  Agreement formerly
provided that the Manager would receive 1.25% of any gross  charterhire  paid to
us. In order to further align the Manager's interests with those of the Company,
the Manager agreed with us to amend the  Management  Agreement to eliminate this
payment,  and we issued to the Manager  restricted  common shares equal to 2% of
our outstanding common shares. any time additional common shares are issued, the
Manager will receive additional  restricted common shares to maintain the number
of common  shares  issued to the Manager at 2% of our total  outstanding  common
shares.  These  restricted  shares  are  nontransferable  for three  years  from
issuance.

         Under  the  Management  Agreement,   the  Manager  pays,  and  receives
reimbursement from us, for our administrative expenses including such items as:

            o   all  costs  and  expenses  incurred  on  our  behalf,  including
                operating   expenses  and  other  costs  for  vessels  that  are
                chartered  out on time charters or traded in the spot market and
                for  monitoring  the  condition  of our vessel that is operating
                under bareboat charter,

            o   executive officer and staff salaries,

            o   administrative  expenses,  including,  among  others,  for third
                party public relations,  insurance,  franchise fees, registrars'
                fees,

            o   all premiums for insurance of any nature,  including  directors'
                and  officers'   liability   insurance  and  general   liability
                insurance,

            o   brokerage  commissions  payable by us on the gross  charter hire
                received in connection with the charters,

            o   directors' fees and meeting expenses,

            o   audit fees,

            o   other expenses approved by the Board of the Directors and

            o   attorneys'  fees  and  expenses,   incurred  on  our  behalf  in
                connection  with (A) any litigation  commenced by or against us,
                (B) any claim or investigation by any  governmental,  regulatory
                or self-regulatory authority involving us.

         We have  agreed  to  defend,  indemnify  and save the  Manager  and its
affiliates (other than us and our subsidiaries),  officers, directors, employees
and agents harmless from and against any and all loss, claim, damage, liability,
cost or expense,  including reasonable  attorneys' fees, incurred by the Manager
or any such  affiliates  based  upon a claim by or  liability  to a third  party
arising out of the  operation of our  business,  unless due to the  Manager's or
such affiliates' negligence or willful misconduct.

         We may terminate the Management Agreement in the event that:

            o   the  Manager  commits  any  material  breach or  omission of its
                material  obligations  or  undertakings  thereunder  that is not
                remedied within thirty days of our notice to the Manager of such
                breach or omission,

            o   the failure of the Manager to maintain adequate authorization to
                perform  its  duties  thereunder  that are not  remedied  within
                thirty days,

            o   certain events of the Manager's bankruptcy, or

            o   it becomes  unlawful for the Manager to perform its duties under
                the Management Agreement.

Commercial and Technical Management Agreements

         We have  entered  into a commercial  agreement  with Teekay  Chartering
Limited,  or  Teekay,  an  affiliate  of  Teekay  Shipping  Corporation  for the
newbuilding  Nordic  Freedom.  Under the  supervision  of the Manager,  Teekay's
duties will include  seeking and negotiating  charters for this vessel.  As with
the Nordic Hunter and the Nordic Hawk,  the  technical  management of the Nordic
Freedom will be performed by IUM under the supervision of the Manager.

         For its services under the commercial management agreement, Teekay will
be entitled to a 1.75% commission on freight,  demurrage and  deadfreight,  plus
the  reimbursement  of  voyage  related  expenses.  However,  if the  vessel  is
committed on a term charter, Teekay will instead receive a commercial management
fee of $400 per day. The initial term of this commercial management agreement is
twenty-four months.

         We have entered into a commercial management  agreement,  commencing in
the second quarter of 2005, with the Swedish based Stena Bulk AS, or Stena,  for
the Nordic Voyager.  Under the  supervision of the Manager,  Stena's duties will
include seeking and negotiating charters for this vessel. For its services under
the  commercial  management  agreement,  Stena  will  be  entitled  to  a  1.75%
commission on freight,  demurrage and  deadfreight,  plus the  reimbursement  of
voyage related expenses.  However, if the vessel is committed on a term charter,
the  commission  will be reduced to 1.25%.  The initial term of this  commercial
management agreement is twelve months.

         The commercial and technical management for the Nordic Voyager is being
temporarily  performed  by  affiliates  of the  previous  owner.  Following  the
commencement  of the  commercial  management  agreement  with Stena,  Wilhelmsen
Marine  Services AS, an affiliate of the previous  owner will, in the near term,
continue to perform the technical management for the vessel.

         We have entered into a technical  management  agreement  for the Nordic
Fighter with V.Ships  Norway AS, or V.Ships.  V.Ships is a marine  service group
that provides ship  management  and related  services to a managed fleet of some
650 vessels  worldwide.  V.Ships has been the  technical  manager for the vessel
since delivery from the shipyard in 1998. We have not yet appointed a commercial
manager for this vessel.

         We have entered into  chartering  agreement,  commencing  in the second
quarter of 2005, with Frontline Ltd., or Frontline, under the supervision of the
Manager for the Nordic Fighter.  Frontline's  duties will, under the supervision
of the Manager,  include  seeking and negotiating  charters for this vessel.  We
have entered into a technical  management  agreement for the Nordic Fighter with
V.Ships under the supervision of the Manager.

B. COMPENSATION

Compensation of Directors and Officers

         During  2004,  the  five  non-employee   directors  received,   in  the
aggregate,  approximately $106,000 in cash fees for their services as directors.
For the period  from  October 1, 2004  through  December  31,  2004 and for each
fiscal year thereafter, each of our non-employee directors receives a fee at the
annual rate of $45,000.  We do not pay director fees to employee  directors.  We
do,  however,  reimburse our directors for all reasonable  expenses  incurred by
them  incurred in connection  with serving on our board of directors.  Directors
may receive  restricted  shares or other grants  under our 2004 Stock  Incentive
Plan described below.

2004 Stock Incentive Plan

         Under  the  terms of the  Company's  2004  Stock  Incentive  Plan,  the
directors, officers and certain key employees of the Company and the Manager are
eligible to receive awards which include incentive stock, restricted stock units
and  performance  shares.  A total of $400,000  common  shares is  reserved  for
issuance upon exercise of options, as restricted share grants or otherwise under
the plan.  Included under the 2004 Stock  Incentive Plan are options to purchase
common shares at an exercise  price equal to $38.75,  the offering  price of the
shares  offered in the follow-on  offering in November  2004,  subject to annual
downward  adjustment  if the payment of  dividends  in the  related  fiscal year
exceed a 3% yield calculated based on the initial strike price. In February 2005
the Company granted, under the terms of the Company's 2004 Stock Incentive Plan,
a total of 270,000 stock options that the Board of Directors had agreed to issue
during 2004. These options will vest in equal  installments on each of the first
four anniversaries of the closing of the follow-on offering in November 2004.

C. BOARD PRACTICES

         The members of the Company's  board of directors  serves until the next
annual general meeting  following his or her election to the board.  The members
of the current  board of directors  were elected at the annual  general  meeting
held in  2004.  The  Company's  Board  of  Directors  has  established  an Audit
Committee,  consisting of two independent directors,  Messrs. Glads0 and Ugland.
Mr. Glads0 serves as the audit committee  financial  expert.  The members of the
Audit Committee do not receive  remuneration  in this capacity.  Under the Audit
Committee  Charter,  the audit  committee  provides  assistance to the Company's
board of directors in  fulfilling  their  responsibility  to  shareholders,  and
investment  community relating to corporate  accounting,  reporting practices of
the  Company,  and the quality and  integrity  of the  financial  reports of the
Company.  The Audit  Committee  is required  under its  Charter to,  among other
duties,  recommend to the Company's board of directors the independent  auditors
to be selected to audit the financial  statements of the Company;  meet with the
independent auditors and financial management of the Company to review the scope
of the  proposed  audit  for the  current  year and the audit  procedures  to be
utilized;  review with the  independent  auditors,  and financial and accounting
personnel,  the adequacy  and  effectiveness  of the  accounting  and  financial
controls of the Company;  and review the financial  statements  contained in the
annual report to shareholders with management and the independent auditors.

D. EMPLOYEES

         We have  employment  agreement  with  Herbjorn  Hansson,  our Chairman,
President and Chief Executive Officer and Mr. Rolf Amundsen, our Chief Financial
Officer. Mr. Hansson does not receive any additional compensation for serving as
a director  or the  Chairman of the Board.  The  aggregate  compensation  of our
executive  officer during 2004 was $133,333.  The aggregate  compensation of our
executive  officers is expected to be  approximately  $560,000  during 2005.  On
certain terms the  employment  agreement may be terminated by us or Mr.  Hansson
upon six months' written notice to the other party.

E. SHARE OWNERSHIP

         The  following  table  sets  forth  information   regarding  the  share
ownership of the Company as of June 10, 2005 by its directors and officers.  All
of the  shareholders  are  entitled  to one vote for each share of common  stock
held.

Title       Identity of Person           No. of Shares               % of Class

Common      Herbj0rn Hansson(1)           357,890                     2%
            Peter Bubenzer               *                            <1%
            Hon. Sir David Gibbons       *                            <1%
            Thorbj0rn Glads0             *                            <1%
            George C. Lodge              *                            <1%
            Andreas Ove Ugland(1)        *                            2%
            Rolf Amundsen                *                            <1%

(1) Includes  332,890 shares held by the Manager,  of which Messrs.  Hansson and
Ugland are sole shareholders.


ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A. MAJOR SHAREHOLDERS

         The  Company  is not  directly  or  indirectly  controlled  by  another
corporation, by a foreign government or by any other natural or legal person.

         According to a Schedule 13G filed on March 31,  2005,  Gilder,  Gagnon,
Howe & Co. LLC owns 748,559 or 5.9%,  as reported in that  Schedule  13G, of the
Company's common shares.

B. RELATED PARTY TRANSACTIONS

         Since May 30,  2003,  Scandic,  which is owned by  Messrs.  Ugland  and
Hansson, has been party to the Management Agreement with the Company.

C. INTERESTS OF EXPERTS AND COUNSEL

                  Not Applicable

ITEM 8.  FINANCIAL INFORMATION

A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION

See Item 17

Legal Proceedings

         To the best of the Company's knowledge, it is not currently involved in
any legal or arbitration proceedings that would have a significant effect on the
Company's  financial  position  or  profitability  and no such  proceedings  are
pending or known to be contemplated by governmental authorities.

Dividend Policy

         Total dividend paid out in 2004 was $47,195,842 or $4.84 per Share. The
dividend  payments  per share in 2000,  2001,  2002,  2003 and 2004 have been as
follows:


  Period                 2000      2001        2002       2003        2004
---------------------------------------------------------------------------
  1st Quarter           $0.34     $1.41       $0.36      $0.63       $1.15
  2nd Quarter            0.45      1.19        0.34       1.27        1.70
  3rd Quarter            0.67      0.72        0.33       0.78        0.88
  4th Quarter            1.10      0.55        0.32       0.37        1.11
---------------------------------------------------------------------------

  Total                 $2.56     $3.87       $1.35      $3.05       $4.84
---------------------------------------------------------------------------


B. SIGNIFICANT CHANGES

                  Not applicable

ITEM 9.  THE OFFER AND LISTING

         Not applicable except for Item 9.A.4. and Item 9.C

                          PRICE RANGE OF COMMON SHARES

         Since  November 16,  2004,  the primary  trading  market for our common
shares has been the New York Stock  Exchange,  or the NYSE,  on which our shares
are listed  under the symbol  "NAT." The primary  trading  market for our common
shares was the American Stock Exchange, or the AMEX, until November 15, 2005, at
which time  trading  of our  common  shares on the AMEX  ceased.  The  secondary
trading  market for our common shares was the Oslo Stock  Exchange,  or the OSE,
until  January 14,  2005,  at which time  trading of our common share on the OSE
ceased.

         The  annual  high and low market  prices for our common  shares in 2004
were $41.59 and $15.00, respectively, as reported by the
AMEX.

         The high and low market prices for our common shares by quarter in 2004
were as follows:

<TABLE>
<CAPTION>
                              AMEX         AMEX         NYSE      NYSE      OSE           OSE
For the quarter ended:        HIGH         LOW          HIGH      LOW       HIGH          LOW
----------------------------------------------------------------------------------------------------
<S>                           <C>          <C>          <C>         <C>     <C>           <C>
March 31, 2004                $27.10       $15.00        N/A        N/A     NOK 179.00    NOK 115.00

June 30, 2004                 $34.59       $21.25        N/A        N/A     NOK 225.00    NOK 160.00

September 30, 2004            $37.75       $25.00        N/A        N/A     NOK 249.00    NOK 210.00

December 31, 2004 (1)         $41.59       $31.15      $41.30      $35.26   NOK 300.00    NOK 214.00

----------------------------------------
</TABLE>
(1) The AMEX  figures  are based on trading  from the  beginning  of the quarter
through  November  15,  2004 and the NYSE  figures  are  based on  trading  from
November 16, 2004 through the end of the quarter.

         The high and low market  prices for our  common  shares by month  since
January 2005 were as follows:

<TABLE>
<CAPTION>
                              AMEX         AMEX         NYSE      NYSE      OSE           OSE
For the month:                HIGH         LOW          HIGH      LOW       HIGH          LOW
----------------------------------------------------------------------------------------------------
<S>                           <C>          <C>          <C>         <C>     <C>           <C>
January 2005 (2)             N/A           N/A         $48.75     $35.95   NOK 225.00    NOK 205.00

February 2005                N/A           N/A         $56.68     $45.39         N/A           N/A

March 2005                   N/A           N/A         $56.15     $43.80         N/A           N/A

April 2005                   N/A           N/A         $49.79     $41.25         N/A           N/A

May 2005                     N/A           N/A         $47.69     $38.00         N/A           N/A
</TABLE>
(1) The AMEX  figures are based on trading  from the  beginning  of the mohrough
    November 15, 2004 and the NYSE  figures are based on trading  from  November
    16, 2004 through the end of the month.
(2) The OSE figures are based on trading from the beginning of the month through
    January 14, 2004.

B. MARKETS

         The  primary  trading  market  for the  Shares  is the New  York  Stock
Exchange, on which the Shares are listed under the symbol "NAT".

ITEM 10. ADDITIONAL INFORMATION

A. SHARE CAPITAL

                  Not Applicable

B. MEMORANDUM AND ARTICLES OF ASSOCIATION

         The  Company's  Memorandum of  Association  provides that the Company's
objects  are as set  forth  in  paragraphs  (b)  through  (n)  and  (p) to  (u),
inclusive,  of the Second  Schedule to The  Companies  Act 1981 of Bermuda.  The
Company's Bye-laws limited the Company's business activities to:

               (i)  entering  into,  or  becoming  a party  to the  Shipbuilding
Contracts  between the Company and the Builder providing for the construction of
the Vessels;

               (ii) supervision of the construction of the Vessels;

               (iii)  entering  into, or becoming a party to, the  Participation
Agreement  among the Company,  the Manager,  the Charterer,  British  Petroleum,
Rabobank  and  Silver  Island  and the BP Letter  Agreement  among the  Company,
British  Petroleum,  the Charterer,  the Manager,  Lazard Freres & Co. LLC which
sets forth certain continuing obligations of each of the parties thereto;

               (iv) entering into, or becoming a party to the Original  Charters
with the Charterer and subsequent Charters with any subsequent  charterer of the
Vessels;

               (v)  entering  into,  or  becoming a party to,  the U.K.  Finance
Leases between the Company and any U.K.  financial  institution  relating to the
lease of the Vessels;

               (vi)  entering  into,  or  becoming a party to, the  Underwriting
Agreement  relating to the public sale and  offering of the Company  warrants by
Lazard Freres & Co. LLC, the Warrant  Agreement  relating to the exercise of the
Company's  warrants,  the  Management  Agreement,  and the  Registration  Rights
Agreement between the Company and Silver Island;

               (vii)  entering  into,  or becoming a party to any  agreement and
performing  all acts  necessary for the conduct of an offering by the Company of
the  Warrants,  and the  listing of the Common  Shares on any stock  exchange or
their inclusion in any securities market;

               (viii)  enforcing its rights and  performing  its  obligations in
respect of any and all of the foregoing;

               (ix)  entering  into  agreements  to  charter,   lease,  sell  or
otherwise dispose of a Vessel upon the termination of its Original Charter;

               (x) entering into, or becoming a party to, and taking all actions
including  amending the Management  Agreement and any other  Agreements to which
the Company is a party and furnishing such security over the Company's assets as
may be  necessary or desirable in  connection  with the  incurrence  of debt for
borrowed  money in the  amount of up to  US$30,000,000  to  purchase  its Common
Shares,  and  authorizing  the Company to pay from the proceeds of such debt and
from its income any costs, fees and expenses in connection with such incurrence,
or refinancing or  replacement  thereof,  costs related to any current or future
proposals  submitted by the Board of Directors to amend these Bye-Laws including
any related proxy  solicitation and regulatory  filings and costs related to the
purchase  by the  Company  of its  Common  Shares  including  the costs and fees
related to the preparation and conduct of a "Dutch Auction"  self-tender  offer;
and

               (xi)  engaging in those  activities,  including the entering into
additional or  supplementary  agreements,  documents and instruments  necessary,
suitable or  convenient to  accomplish  the  foregoing or incidental  thereto or
connected therewith.

         Upon expiration of the BP Charters, the abovementioned limitations were
automatically removed.

         The following  section of the Company's  Report on Form F-6, filed with
the  Securities  and  Exchange  Commission  on  February  15,  2005,  is  hereby
incorporated by reference:

                  1. Description of Capital Stock (Exhibit 99.1).

         The following section of the Company's Prospectus Supplement filed with
the  Securities  Exchange  Commission  under  Rule  424(b)(2)  on March 3,  2005
(Registration No. 333-118128), is hereby incorporated by reference:

                  1.       Our Dividend Policy (p.21)


C. MATERIAL CONTRACTS

         On May  30,  2003,  the  Company's  shareholders  approved  a  novation
agreement  by which the  Management  Agreement  was novated from UNS to Scandic.
Otherwise,  the Company has not entered into any material  contracts outside the
ordinary course of business during the past three years.

D. EXCHANGE CONTROLS

         The  Company  has been  designated  as a  non-resident  of Bermuda  for
exchange control purposes by the Bermuda  Monetary  Authority,  whose permission
for the issue of the Common Shares was obtained prior to the offering thereof.

         The transfer of shares  between  persons  regarded as resident  outside
Bermuda for exchange control purposes and the issuance of Common Shares to or by
such persons may be effected without specific consent under the Bermuda Exchange
Control Act of 1972 and regulations  thereunder.  Issues and transfers of Common
Shares involving any person regarded as resident in Bermuda for exchange control
purposes  require specific prior approval under the Bermuda Exchange Control Act
1972.

         Subject to the  foregoing,  there are no  limitations  on the rights of
owners of the Common  Shares to hold or vote their  shares.  Because the Company
has been designated as non-resident for Bermuda exchange control purposes, there
are no restrictions on its ability to transfer funds in and out of Bermuda or to
pay dividends to United States  residents who are holders of the Common  Shares,
other than in respect of local Bermuda currency.

         In accordance with Bermuda law, share  certificates  may be issued only
in the names of corporations or individuals.  In the case of an applicant acting
in a special  capacity  (for example,  as an executor or trustee),  certificates
may, at the request of the applicant, record the capacity in which the applicant
is acting.  Notwithstanding  the  recording  of any such special  capacity,  the
Company is not bound to  investigate or incur any  responsibility  in respect of
the proper administration of any such estate or trust.

         The Company will take no notice of any trust  applicable  to any of its
shares or other securities whether or not it had notice of such trust.

         As an "exempted company", the Company is exempt from Bermuda laws which
restrict the percentage of share capital that may be held by non-Bermudians, but
as an exempted  company,  the Company may not  participate  in certain  business
transactions  including:  (i) the  acquisition  or  holding  of land in  Bermuda
(except  that  required for its business and held by way of lease or tenancy for
terms of not more  than 21  years)  without  the  express  authorization  of the
Bermuda  legislature;  (ii) the taking of mortgages on land in Bermuda to secure
an amount in excess of $50,000 without the consent of the Minister of Finance of
Bermuda;  (iii) the  acquisition  of  securities  created  or issued  by, or any
interest in, any local company or business,  other than certain types of Bermuda
government  securities  or  securities of another  "exempted  company,  exempted
partnership  or  other  corporation  or  partnership  resident  in  Bermuda  but
incorporated abroad; or (iv) the carrying on of business of any kind in Bermuda,
except in so far as may be necessary for the carrying on of its business outside
Bermuda or under a license granted by the Minister of Finance of Bermuda.

         There is a statutory remedy under Section 111 of the Companies Act 1981
which provides that a shareholder may seek redress in the Bermuda courts as long
as  such  shareholder  can  establish  that  the  Company's  affairs  are  being
conducted,  or have been conducted, in a manner oppressive or prejudicial to the
interests of some part of the shareholders, including such shareholder. However,
this remedy has not yet been interpreted by the Bermuda courts.

         The  Bermuda  government  actively  encourages  foreign  investment  in
"exempted"  entities  like the  Company  that are  based in  Bermuda  but do not
operate  in  competition   with  local  business.   In  addition  to  having  no
restrictions on the degree of foreign ownership,  the Company is subject neither
to taxes on its income or dividends nor to any exchange controls in Bermuda.  In
addition,  there  is no  capital  gains  tax  in  Bermuda,  and  profits  can be
accumulated by the Company, as required, without limitation.  There is no income
tax treaty  between the United States and Bermuda  pertaining to the taxation of
income other than applicable to insurance enterprises.

E. TAXATION

         The Company is incorporated in Bermuda.  Under current Bermuda law, the
Company  is not  subject  to tax on  income or  capital  gains,  and no  Bermuda
withholding tax will be imposed upon payments of dividends by the Company to its
shareholders.  No Bermuda tax is imposed on holders  with respect to the sale or
exchange of Shares.  Furthermore,  the Company has received from the Minister of
Finance of Bermuda under the Exempted  Undertakings  Tax Protection Act 1966, as
amended,  an assurance  that, in the event that Bermuda  enacts any  legislation
imposing  any tax  computed  on profits or income,  including  any  dividend  or
capital gains  withholding tax, or computed on any capital asset,  appreciation,
or any tax in the  nature  of an  estate,  duty or  inheritance  tax,  then  the
imposition  of any such tax  shall  not be  applicable.  The  assurance  further
provides  that  such  taxes,  and  any  tax in the  nature  of  estate  duty  or
inheritance  tax,  shall  not  be  applicable  to  the  Company  or  any  of its
operations,  nor to the shares,  debentures or other obligations of the Company,
until March 2016.

F. DIVIDENDS AND PAYING AGENTS

                  Not Applicable

G. STATEMENT BY EXPERTS

                  Not Applicable

H. DOCUMENTS ON DISPLAY

         The  Company  is  subject  to  the  informational  requirements  of the
Securities   Exchange  Act  of  1934,  as  amended.  In  accordance  with  these
requirements  we file  reports and other  information  with the  Securities  and
Exchange  Commission.  These  materials,  including  this annual  report and the
accompanying  exhibits  may be  inspected  and  copied at the  public  reference
facilities  maintained  by  the  Commission  at100  F  Street,  NE,  Room  1580,
Washington,  D.C.  20549.  You may obtain  information  on the  operation of the
public reference room by calling 1 (800) SEC-0330,  and you may obtain copies at
prescribed  rates from the Public  Reference  Section of the  Commission  at its
principal  office  in  Washington,  D.C.  20549.  The SEC  maintains  a  website
(http://www.sec.gov.)  that contains reports,  proxy and information  statements
and other information  regarding  registrants that file  electronically with the
SEC. In addition,  documents  referred to in this annual report may be inspected
at the  Company's  headquarters  at Reid House 31 Church  Street,  Hamilton HM F
Bermuda.

         We  furnish   holders  of  our  ordinary  shares  with  annual  reports
containing  audited financial  statements and a report by our independent public
accountants,  and intend to make available quarterly reports containing selected
unaudited  financial  data for the first three quarters of each fiscal year. The
audited  financial  statements will be prepared in accordance with United States
generally accepted accounting principles.  As a "foreign private issuer," we are
exempt  from the  rules  under  the  Securities  Exchange  Act  prescribing  the
furnishing and content of proxy statements to  shareholders.  While we intend to
furnish proxy statements to shareholders in accordance with the rules of the New
York Stock  Exchange,  those proxy  statements do not conform to Schedule 14A of
the  proxy  rules  promulgated  under  the  Exchange  Act.  All  reports,  proxy
statements  and other  information  filed by us with the New York Stock Exchange
may be inspected at the New York Stock  Exchange's  offices at 20 Broad  Street,
New York, New York 10005.  In addition,  as a "foreign  private  issuer," we are
exempt  from the rules under the  Exchange  Act  relating to short swing  profit
reporting and liability.

I. SUBSIDIARY INFORMATION

                  Not applicable.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The  Company is exposed to market risk from  changes in interest  rates
related to the variable rate of the Company's borrowings,  or the Loan under our
credit facility

         Amounts borrowed under the credit facility will bear interest at a rate
equal to LIBOR plus a margin  between 0.80% to 1.20% per year  (depending on the
loan to vessel value ratio).

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

                  Not Applicable

                                     PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

                  Not Applicable

ITEM 14. MATERIAL  MODIFICATIONS  TO THE RIGHTS OF SECURITY  HOLDERS AND USE OF
         PROCEEDS

                  Not Applicable

ITEM 15. CONTROLS AND PROCEDURES.

(a) Evaluation of disclosure controls and procedures.

         As of December 31, 2004, the Company  carried out an evaluation,  under
the  supervision  and  with  the  participation  of  the  Company's  management,
including Mr.  Herbj0rn  Hansson,  acting as of that date as the Company's Chief
Executive  Officer  and Rolf  Amundsen,  the  Chief  Financial  Officer,  of the
effectiveness of the design and operation of the Company's  disclosure  controls
and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation,
the Chief  Executive  Officer and Chief  Financial  Officer  concluded  that the
Company's  disclosure  controls and  procedures  are  effective in alerting them
timely to material  information  relating to the Company required to be included
in the Company's periodic SEC filings.

(b) N/A

(c) N/A

(d) Changes in internal control over financial reporting

         There have been no significant  changes in our internal  controls or in
other factors that could have significantly  affected those controls  subsequent
to the date of our most recent  evaluation of internal  controls,  including any
corrective  actions  with  regard  to  significant   deficiencies  and  material
weaknesses.

ITEM 16.   RESERVED.

ITEM 16A.  AUDIT COMMITTEE FINANCIAL EXPERT

         The Board of Directors has determined  that Mr.  Torbj0rn  Glads0 is an
audit committee financial expert.

ITEM 16B.  CODE OF ETHICS.

         The Company is currently  considering whether to adopt a code of ethics
described under this Item 16B.

ITEM 16C.  PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees

         The following  table sets forth,  for the two most recent fiscal years,
the aggregate fees billed for  professional  services  rendered by the principal
accountant  for the  audit of the  Company's  annual  financial  statements  and
services  provided by the principal  accountant in connection with statutory and
regulatory filings or engagements for the two most recent fiscal years.

FISCAL YEAR ENDED DECEMBER 31, 2004                       $49,700
FISCAL YEAR ENDED DECEMBER 31, 2003                       $13,500

(b) Audit-Related Fees

FISCAL YEAR ENDED DECEMBER 31, 2004                       $90,400
FISCAL YEAR ENDED DECEMBER 31, 2003                            $0

(c) Tax Fees

FISCAL YEAR ENDED DECEMBER 31, 2004                            $0
FISCAL YEAR ENDED DECEMBER 31, 2003                       $21,950


(d) All Other Fees

            Not applicable.

(e) Audit Committee's Pre-Approval Policies and Procedures

         Our audit committee pre-approves all audit, audit-related and non-audit
services not prohibited by law to be performed by our  independent  auditors and
associated fees prior to the engagement of the independent  auditor with respect
to such services.

            (1) Not applicable.

(f) Not applicable.

ITEM 16D.  EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

            Not Applicable

ITEM 16E.   PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PERSONS.

            Not Applicable

                                    PART III

ITEM 17. FINANCIAL STATEMENTS

            Not Applicable


ITEM 18. FINANCIAL STATEMENTS



         See pages F-1 through F-11

<PAGE>


NORDIC AMERICAN TANKER SHIPPING LIMITED


TABLE OF CONTENTS
-------------------------------------------------------------------------------

                                                                Page

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS             F-2

FINANCIAL STATEMENTS                                            F-3


Balance Sheets                                                  F-3


Statements of Operations                                        F-4

Statements of Cash Flows                                        F-5


Statements of Shareholders' Equity                              F-6


Notes to Financial Statements                                   F-7




<PAGE>


REPORT  OF  INDEPENDENT  REGISTERED  PUBLIC  ACCOUNTING  FIRM  To the  Board  of
Directors and Stockholders of Nordic American Tanker Shipping Limited Bermuda


We have audited the balance sheets of Nordic  American Tanker Shipping Ltd. (the
"Company")  as of December  31, 2004 and 2003,  and the  related  statements  of
operations,  cash flows, and shareholders' equity for each of the three years in
the  period  ended  December  31,  2004.  These  financial  statements  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements  are free of material  misstatement.  The Company is not  required to
have,  nor  were we  engaged  to  perform,  an audit of  internal  control  over
financial reporting.  Our audit included  consideration of internal control over
financial  reporting  as  a  basis  for  designing  audit  procedures  that  are
appropriate  in the  circumstances,  but not for the  purpose of  expressing  an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting. Accordingly, we express no opinion. An audit also includes examining,
on a  test  basis,  evidence  supporting  the  amounts  and  disclosures  in the
financial  statements,  assessing the accounting principles used and significant
estimates  made by  management,  as well as  evaluating  the  overall  financial
statement  presentation.  We believe that our audits provide a reasonable  basis
for our opinion.

In our  opinion,  such  financial  statements  present  fairly,  in all material
respects,  the  financial  position  of Nordic  American  Tanker  Shipping as of
December 31, 2004 and 2003,  and the results of their  operations and their cash
flows for each of the three  years in the  period  ended  December  31,  2004 in
conformity with accounting principles generally accepted in the United States of
America.


Oslo, Norway, 18 May, 2005

Deloitte Statsautoriserte Revisorer AS


<PAGE>
<TABLE>
<CAPTION>
BALANCE SHEET                                          Notes   Dec. 31          Dec. 31
All figures in USD                                             2004             2003
------------------------------------------------------------------------------------------
<S>                                                      <C>   <C>                 <C>
ASSETS
Current Assets
       Cash and Cash Equivalents                         1     30,732,516          565,924
       Accounts and Receivable                           1      4,539,354        8,142,307
       Prepaid Finance Charges                                  1,206,348           14,475
       Prepaid Insurance                                          273,362           91,667
------------------------------------------------------------------------------------------
Total Current Assets                                           36,751,580        8,814,373
------------------------------------------------------------------------------------------
Long-term Assets
       Vessels                                           4    187,301,038      128,081,925
       Prepaid Finance Charges                                    150,793                -
------------------------------------------------------------------------------------------
Total Assets                                                  224,203,411      136,896,298
------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
       Accounts Payable                                           411,366                -
       Deferred Revenue                                         1,286,070                -
       Accrued Liabilities                                        637,582           38,322
       Derivative Contract                                              -        1,150,000
       Current Portion of Long-term Debt                                -       30,000,000
-----------------------------------------------------------------------------------------
Total Current liabilities                                       2,335,018       31,188,322
-----------------------------------------------------------------------------------------

SHAREHOLDERS' EQUITY
       Common Shares, par value $.01 per share,
       (51,200,000 shares authorized; 13,067,838
       Issued and outstanding, (9,706,606 in 2003)      6         130,678           97,066

       Additional Paid-in Capital                             265,752,581      144,395,866
       Accumulated Other Comprehensive Loss                             -      (1,150,000)
       Accumulated Deficit                                    (44,014,866)    (37,634,956)
------------------------------------------------------------------------------------------
Total Shareholders' Equity                                    221,868,393      105,707,976
------------------------------------------------------------------------------------------
Total liabilities & Shareholders' equity                      224,203,411      136,896,298
------------------------------------------------------------------------------------------

        The footnotes are an integral part of these financial statements
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
(all figures in USD)                                         Year Ended December 31,
                                                --------------------------------------------------
                                       Notes            2004             2003             2002
                                       -----            ----             ----             ----

<S>                                      <C>         <C>              <C>               <C>
Voyage Revenue                           1, 3        67,451,598       37,370,756        18,057,989
Voyage Expenses                                      (4,925,353)        (184,781)         (184,781)
Vessel Operating Expenses                            (1,976,766)               -                 -
Administrative Expenses                  2, 5       (10,851,688)       (468,087)         (427,048)
Depreciation                              4          (6,918,164)     (6,831,040)       (6,831,040)
                                                --------------------------------------------------
Net Operating Income                                 42,779,627       29,886,848        10,615,120
                                                --------------------------------------------------
Interest Income                                         143,230           26,462            21,409
Interest Expense                                     (1,971,304)      (1,797,981)       (1,764,424)
Other Financial Charges                                (135,621)         (15,040)          (24,837)
                                                --------------------------------------------------
Net Financial Items                                  (1,963,695)      (1,786,559)       (1,767,852)
                                                --------------------------------------------------
Net Profit before tax                                40,815,932       28,100,289         8,847,268
                                                --------------------------------------------------
Tax Expense                                                   -                -                 -
                                                --------------------------------------------------
Net Profit for the Year                              40,815,932       28,100,289         8,847,268
                                                --------------------------------------------------
Basic and Diluted Earnings per Share                      4.05             2.89               0.91
Weighted Average Number of
    Shares Outstanding                               10,078,391        9,706,606         9,706,606


        The footnotes are an integral part of these financial statements
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
STATEMENT OF CASH FLOWS
(all figures in USD)                                           Year Ended December 31,
                                                     -----------------------------------------------
                                                        2004             2003            2002
                                                        ----             ----            ----
<S>                                                     <C>             <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Profit                                              40,815,932      28,100,289        8,847,268
Reconcilation of Net Profit to Net Cash From
Operating Activities
Depreciation                                             6,918,164       6,831,040        6,831,040
Amortization of Prepaid Finance Costs                      112,838          14,480           14,480
Share-based Compensation                                 9,252,365               -                -
Increase (decrease) in:
     Accounts Receivable                                 3,602,956     (4,865,784)      (3,106,343)
     Accounts Payable and Accrued Liabilities            1,010,626       (178,140)          176,800
     Deferred Revenue                                    1,286,075               -                -
     Other Assets                                        (181,695)         (8,334)         (12,337)
                                                    -------------      -----------      -----------
Net Cash Provided By Operating Activities               62,817,261      29,893,551       12,750,908
                                                    -------------      -----------      -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in Vessels                                 (66,137,277)                                -
Net Cash Used In Investing Activities                 (66,137,277)               -                -

CASH FLOWS FROM FINANCING ACTIVITIES                                             -                -
Proceeds from Sale of Common Stock                     112,137,953               -                -
Proceeds from Use of the Credit Facility                96,000,000               -                -
Repayment of Debt                                    (126,000,000)               -                -
Loan Facility Costs                                    (1,455,503)               -                -
Dividends Paid                                        (47,195,842)    (29,605,410)     (13,103,993)
                                                    -------------      -----------      -----------
Net Cash Provided By (Used In) Financing Activities     33,486,608    (29,605,410)     (13,103,993)
                                                    -------------      -----------      -----------
Net Increase (Decrease) in Cash and Cash Equivalents    30,166,592         288,141        (353,085)
                                                    -------------      -----------      -----------
Beginning Cash and Cash Equivalents                        565,924         277,783          630,868
Ending Cash and Cash Equivalents                        30,732 516         565,924          277,783
                                                    -------------      -----------      -----------
Cash Paid for Interest                                   1,774,264       1,975,125        1,587,622


        The footnotes are an integral part of these financial statements
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF SHAREHOLDERS' EQUITY
(all figures in USD)


                                                                           Accumulated
                                             Additional                         Other           Total           Total
                                  Common       Paid-in      Accumulated     Comprehensive    Shareholders'  Comprehensive
                                  Shares       Capital        Deficit            Loss           Equity          Income
-----------------------------------------------------------------------------------------------------------------------------
<S>        <C>                      <C>     <C>            <C>                <C>             <C>                <C>
Balance at 01.01.02                 97,066  144,395,866    (31,873,110)       (778,000)       111,841,822
-----------------------------------------------------------------------------------------------------------------------------
Net Profit                                                   8,847,268                          8,847,268         8,847,268
Unrealized Loss on
Derivative Instruments                                                      (2,262,564)        (2,262,564)      (2,262,564)
Adjustment for Losses on
Derivatives Reclassified to
Earnings                                                                     1,024,564          1,024,564         1,024,564
Dividends Paid                                             (13,103,993)                       (13,103,993)

Total Comprehensive
Income                                                                                                            7,609,268
-----------------------------------------------------------------------------------------------------------------------------

Balance at 12.31.02                 97,066  144,395,866    (36,129,835)     (2,016,000)       106,347,097
Net Profit                                                  28,100,289                         28,100,289        28,100,289
Unrealized Loss on
Derivative Instruments                                                        (365,723)          (365,723)        (365,723)
Adjustment for Losses on
Derivatives Reclassified to
Earnings                                                                     1,231,723          1,231,723         1,231,723
Dividends Paid                                              (29,05,410)                       (29,605,410)
-----------------------------------------------------------------------------------------------------------------------------
Total Comprehensive
Income                                                                                                           28,966,289
-----------------------------------------------------------------------------------------------------------------------------

Balance at 12.31.03                 97,066  144,395,866    (37,634,956)     (1,150,000)       105,707,976
Net profit                                                  40,815,932                         40,815,932        40,815,932
Common Shares Issued                33,612  121,356,715                                       121,390,327
Unrealized Loss on
Derivative Instruments                                                         (20,710)           (20,710)         (20,710)
Adjustment for Losses on
Derivatives Reclassified to
Earnings                                                                     1,170,710          1,170,710         1,170,710
Dividends Paid                                             (47,195,842)                       (47,195,842)
-----------------------------------------------------------------------------------------------------------------------------
Total Comprehensive
Income                                                                                                           41,965,932
-----------------------------------------------------------------------------------------------------------------------------

Balance at 12.31.04                130,678  265,752,581    (44,014,866)              -        221,868,393
-----------------------------------------------------------------------------------------------------------------------------

                                The footnotes are an integral part of these financial statements
</TABLE>

<PAGE>

                     NORDIC AMERICAN TANKER SHIPPING LIMITED

                          NOTES TO FINANCIAL STATEMENTS


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These  financial  statements  have been prepared in accordance  with  accounting
principles generally accepted in the United States of America (US GAAP).

Nature of Business:  The principal  business of Nordic  American Tanker Shipping
Limited (the "Company") is to own and operate Suezmax crude oil tankers.

Use of Estimates: Preparation of financial statements in accordance with US GAAP
necessarily  includes  amounts  based  on  estimates  and  assumptions  made  by
management. Actual results could differ from those amounts.

Concentration of Credit Risk: Financial instruments that potentially subject the
Company  to  concentrations  of  credit  risk  consist  principally  of cash and
accounts  receivable.  The Company  maintains its cash with reputable  financial
institutions.  The terms of these  deposits are on demand to minimize  risk. The
Company  has not  experienced  any losses  related to these  cash  deposits  and
believes it is not exposed to any significant credit risk.

Accounts receivable consist of  uncollateralized  receivables from international
customers  primarily in the international  shipping  industry.  To minimize risk
associated with  international  transactions,  all sales are denominated in U.S.
currency.   The  Company  routinely  assesses  the  financial  strength  of  its
customers.  The Company considers  accounts  receivable to be fully collectible;
accordingly,  no allowance for doubtful accounts is required.  If amounts become
uncollectible,  they will be charged to operations  when that  determination  is
made.

Cash and Cash  Equivalents:  Cash and cash equivalents  consist of deposits with
original maturities of three months or less.

Property  and  Equipment:  Depreciation  and  amortization  are  provided  on  a
straight-line basis over the estimated useful lives of the assets. The Company's
property and equipment  consist solely of vessels.  The estimated useful life of
these  vessels  is 25  years  from the date the  vessel  is  delivered  from the
shipyard. Repairs and maintenance are expensed as incurred.

Impairment of Long-Lived  Assets:  Long-lived assets are required to be reviewed
for impairment  whenever  events or changes in  circumstances  indicate that the
carrying  amount  of  an  asset  may  not  be  recoverable.   If  the  estimated
undiscounted  future cash flows expected to result from the use of the asset and
its  eventual  disposition  is less than the carrying  amount of the asset,  the
asset is deemed  impaired.  The  amount of the  impairment  is  measured  as the
difference between the carrying value and the fair value of the asset.

Revenue Recognition:  Revenues are generated from freight billings, time charter
and bareboat  charter  hires.  Time charter and  bareboat  charter  revenues are
recorded over the term of the charter as the  applicable  vessel  operates under
the charter.  The Company  uses a  discharge-to-discharge  basis in  determining
percentage of completion for all spot voyages.  The operating results of voyages
in progress at a reporting date are estimated and  recognised  pro-rata on a per
day basis.

Financial Instruments: The fair values of cash and cash equivalents,  short-term
investments,  accounts receivable,  and accounts payable  approximated  carrying
value because of the short-term nature of these instruments

Finance costs:  Finance costs,  including fees,  commissions and legal expenses,
which  are  presented  as  other  assets  are  capitalized  and  amortized  on a
straight-line basis over the term of the relevant Credit Facility.  Amortization
of finance costs is included in interest expense.

Segment Information: The Company has identified only one operating segment under
Statement of Financial  Accounting  Standards  ("SFAS") No. 131  "Segments of an
Enterprise and Related  Information."  The Company has only one type of vessel -
Suezmax  crude oil  tankers -  operating  on time  charter  contracts  at market
related rates, in the spot market and on long-term bareboat contract.

Stock-Based   Compensation:   The  Company  follows  No.  123,  "Accounting  for
Stock-Based  Compensation"  ("SFAS 123"),  which  establishes a fair value-based
method of accounting for stock-based compensation plans

Derivative  Instruments  and Hedging  Activities:  The Company  accounts for its
derivative  instruments and hedging activities according to No. 133, "Accounting
for Derivative  Instruments and Hedging Activities",  as amended by SFAS No. 137
and SFAS No. 138. This standard, as amended,  requires derivative instruments to
be recorded in the balance sheet at their fair value.  Changes in the fair value
of derivatives that do not qualify for hedge  treatment,  as well as ineffective
portions  of any hedge,  are  recorded  to  earnings.  Changes in fair value for
qualifying cash  flow-hedges are recorded in equity and are realized in earnings
in conjunction with the gain or loss on the hedged item or transaction.

Changes in the fair value of qualifying hedges offset  corresponding  changes in
the fair value of the hedged item in the statement of operations.

Net Profit per Share: SFAS No. 128 "Earnings Per Share," (EPS) requires earnings
per share to be computed and  reported as both basic EPS and diluted EPS.  Basic
EPS is computed by dividing net income by the weighted  average number of common
shares  outstanding  for the period.  Diluted  EPS is  computed by dividing  net
income by the weighted average number of common shares and dilutive common stock
equivalents (ie. stock options,  warrants)  outstanding  during the period.  The
Company  does not have any  potentially  dilutive  or  anti-dilutive  securities
outstanding.

Income taxes: The Company is incorporated in Bermuda. Under current Bermuda law,
the Company is not subject to corporate income taxes.

New  Pronouncements:  In December  2004,  the FASB issued SFAS No. 123  (revised
2004),  "Share-Based  Payment"  ("SFAS  123R"),  which replaces SFAS No. 123 and
supercedes APB Opinion No. 25,  "Accounting for Stock Issued to Employees." SFAS
123R  requires  all  share-based  payments  to  employees,  including  grants of
employee stock options,  to be recognized in the financial  statements  based on
their fair values  beginning  with the first annual  period after June 15, 2005,
with early adoption encouraged.  Under SFAS 123R, the Company must determine the
appropriate fair value model to be used for valuing  share-based  payments,  the
amortization  method for compensation  cost and the transition method to be used
at date of  adoption.  The Company is currently  evaluating  the effect that the
adoption  of SFAS 123R will have on its  results  of  operations  and  financial
condition but does not expect it to have a material impact.

 In December  2004,  the FASB issued SFAS No.  153,  "Exchanges  of  Nonmonetary
Assets--An   Amendment  of  APB  Opinion  No.  29,  Accounting  for  Nonmonetary
Transactions"  ("SFAS 153").  SFAS 153  eliminates the exception from fair value
measurement for nonmonetary  exchanges of similar productive assets in paragraph
21(b) of APB Opinion No. 29,  "Accounting  for  Nonmonetary  Transactions,"  and
replaces  it  with an  exception  for  exchanges  that  do not  have  commercial
substance.  SFAS  153  specifies  that a  nonmonetary  exchange  has  commercial
substance  if the  future  cash  flows of the  entity  are  expected  to  change
significantly as a result of the exchange.  SFAS 153 is effective for the fiscal
periods  beginning after June 15, 2005. The Company is currently  evaluating the
effect that the adoption of SFAS 153 will have on its results of operations  and
financial condition but does not expect it to have a material impact.

2.  RELATED PARTY TRANSACTIONS

The Manager,  Scandic  American  Shipping Ltd., is jointly owned by the Chairman
and CEO of the Company,  Mr. Herbj0rn Hansson,  and a Board Member,  Mr. Andreas
Ove Ugland. The Manager, under the Management Agreement,  assumes commercial and
operational  responsibility  of  our  vessels  and is  required  to  manage  our
day-to-day  business  subject,   always,  to  our  objectives  and  policies  as
established from time to time by the Board of Directors.  For its services under
the  Management  Agreement,  the Manager is entitled to cover the cost  incurred
plus a management fee equal to $100,000 per annum.  The Manager also has a right
to 2% of the  Company's  total  outstanding  shares  (see  Note  7  "Share-Based
Compensation").  The Company  has  recognized  total  costs of $653,799  for the
services provided under the Management Agreement for the year ended December 31,
2004,  additionally the Company  recognized  $9,252,365 in non-cash  share-based
compensation  expense related to the issuance of shares to the Manager (see Note
7 "Share-Based Compensation"). Payable at year end was $105,080.

At the end of the year 2004 Mr.  Ugland held a 25.7%  ownership  interest in IUM
Shipmanagement AS (IUM), a third-party technical manager to whom the Manager has
sub-contracted  technical  management  for some of the vessels.  The Company has
recognized  costs of $1,863,552  for the services  provided  under the Technical
Management  Agreements for the year ended December 31, 2004. Payable at year end
was $116,681.

Mr. Jan Erik Langangen, Executive Vice President of the Manager, is a partner of
Langangen & Helset  Advokatfirma  DA which in the past has also provided and may
continue to provide legal  services to us. The Company has  recognized  costs of
$33,435 for the services provided by Langangen & Helset Advokatfirma DA. Payable
at year end was $38,157.

3.  REVENUE

For the twelve  months ending  December 31, 2004,  our only source of income was
from our four vessels of which two are on charter to BP Shipping,  one vessel on
charter to Gulf Navigation and one on charter to the previous owner.  All of the
Company's revenues are earned in international markets.

One  customer  accounted  for 97% of  Company's  revenues  during the year ended
December 31, 2004. One customer  accounted for 100% of Company's revenues during
the year ended December 31, 2003 and December 31, 2002.

4.  PROPERTY AND EQUIPMENT

Property and equipment  consist of four Suezmax crude oil tankers built in 1997.
Depreciation  is calculated on a straight-line  basis over the estimated  useful
life of the vessels. The estimated useful life of a new vessel is 25 years.

                                                 2004                  2003
      ---------------------------------------------------------------------
      Acquisition cost                    $236,913,247          $170,775,970
      Accumulated depreciation            (49,612,209)          (42,694,045)
      ---------------------------------------------------------------------
                                          $187,301,038          $128,081,925
      =====================================================================

5.  ADMINISTRATIVE EXPENSES
<TABLE>
<CAPTION>
                                                    2004            2003           2002
      ----------------------------------------------------------------------------------
      <S>                                     <C>               <C>             <C>
      Management fee                            $175,000         $250,000       $250,000
      Directors and officers insurance           112,500          101,666         86,667
      Share-based compensation                 9,252,365                0              0
      Other fees and expenses                  1,311,823          116,421         90,381
      ---------------------------------------------------------------------------------
      Total administrative expenses          $10,851,688         $468,087       $427,048
      =================================================================================
</TABLE>
6. STOCK HOLDERS' EQUITY

Authorized, and issued and outstanding common shares rollforward is as follows:
<TABLE>
<CAPTION>
                                              Authorized Shares  Issued and
                                                                 Outstanding Shares
      -----------------------------------------------------------------------------
      <S>                                            <C>             <C>
      Balance at 01.01.03                            51,200,000        9,706,606
      Follow-on Offering - November 2004                      -        3,105,000
      Share-based Compensation                                -          256,232
      ---------------------------------------------------------------------------
      Balance at 12.31.04                            51,200,000       13,067,838
      ---------------------------------------------------------------------------
</TABLE>


7.  SHARE-BASED COMPENSATION

2004 Stock Incentive Plan

Under the terms of the  Company's  2004 Stock  Incentive  Plan,  the  directors,
officers  and certain  key  employees  of the  Company  and the Manager  will be
eligible to receive awards which include incentive stock options,  non-qualified
stock options, stock appreciation rights, dividend equivalent rights, restricted
stock,  restricted stock units and performance shares. A total of 400,000 common
shares are reserved for issuance upon exercise of options,  as restricted  share
grants  or  otherwise  under  the  plan.  No  options  have  been  issued or are
outstanding at December 31, 2004.

Restricted Shares

The Management  Agreement formerly provided that the Manager would receive 1.25%
of any gross  charterhire  paid to us. In order to further  align the  Manager's
interests  with those of the  Company,  the Manager  agreed with us to amend the
Management Agreement, effective October 12, 2004, to eliminate this payment, and
we have  issued  to the  Manager  restricted  common  shares  equal to 2% of our
outstanding  common  shares at par value of $0.01  per  share.  At the time when
additional  common  shares are  issued,  the  Manager  will  receive  additional
restricted  common  shares to maintain the number of common shares issued to the
Manager at 2% of our total  outstanding  common shares.  These restricted shares
are non-transferable for three years from issuance.  During 2004 the Company has
issued to the Manager an aggregate of 256,232 shares at an average fair value of
$36.11.  The  share-based  compensation  expense  related  to  the  issuance  of
restricted  shares  to the  Manager  of  $9,252,365  in 2004 was  classified  as
administrative expenses.

8.  LONG-TERM DEBT

On September 29, 2004, the Company  obtained an extension of the maturity of its
$30 million loan from December  2004 to October  2007.  Interest on the loan, as
extended, was at a rate equal to LIBOR plus a margin of 0.70%.

In October 2004 the Company entered into the Credit Facility,  which consists of
a $50 million  revolving  credit  facility and a $250 million  revolving  credit
facility.  The $50 million  facility  will  mature in October  2007 and the $250
million facility will mature in October 2005,  unless the Company  exercises the
one-year  extension  option or the  option to  convert  any drawn  amounts  to a
five-year  term  loan.  Amounts  borrowed  under the Credit  Facility  will bear
interest at a rate equal to LIBOR plus a margin between 0.80% to 1.20% per year.
The Company  pays a  commitment  fee, at a rate  ranging from 0.24% to 0.36% per
year, on any undrawn amount.

On November 8, 2004,  the Company repaid its $30 million loan with proceeds from
the Credit  Facility.  The drawn amount on the credit facility was  subsequently
repaid with  proceeds  from the share issue on November 23, 2004.  There were no
outstanding borrowings under the Credit Facility at December 31, 2004.

9. DERIVATIVE INSTRUMENTS AND RISK MANAGEMENT

In 2003, the Company had outstanding a $ 30 million  variable rate loan that was
repaid in November 2004. The Company had hedged the variable  interest  exposure
by an interest  rate swap  whereby the Company  paid a fixed  interest  rate and
received a variable interest (LIBOR). The interest rate swap was designated as a
cash flow hedge of the interest  payments on the loan.  The  interest  rate swap
matured in 2004. The Company did not hold any derivative instruments at December
31, 2004.

The effective  portion of gains and losses on the interest rate swap  designated
as a cash flow hedge was deferred to accumulated other comprehensive  income and
was  reclassified to earnings as the hedged interest  payments were  recognized.
The Company reclassified  $1,170,000 from accumulated other comprehensive income
to earnings in 2004. The reclassified loss was included in interest expense.

The fair value of the swap was recorded as a liability of $1,150,000 at December
31, 2003.

10.  COMMITMENTS AND CONTINGENCIES

Litigation  and  Environmental  Matters  -The  Company can be a party to various
legal  proceedings  generally  incidental  to its  business  and is subject to a
variety of environmental and pollution  control laws and regulations.  As is the
case with other companies in similar industries, the Company faces exposure from
actual  or  potential  claims  and  legal  proceedings.  Although  the  ultimate
disposition of legal proceedings  cannot be predicted with certainty,  it is the
opinion of the Company's management that the outcome of any claim which might be
pending or threatened, either individually or on a combined basis, will not have
a materially adverse effect on the financial position of the Company,  but could
materially affect the Company's results of operations in a given year.

11.  SUBSEQUENT EVENTS

In January 2005 the Company  entered into two separate  agreements  to acquire a
1998  built  Suezmax  vessel  and a 2005  Suezmax  newbuilding  at an  aggregate
purchase price of $149.25  million.  The Company took delivery of the vessels in
March 2005.

In February  2005 the Company  granted,  under the terms of the  Company's  2004
Stock Incentive Plan, a total of 270,000 stock options. The closing price of our
common  shares on the date these  options  were  granted was $48.95 per share as
reported  on the New York  Stock  Exchange.  These  options  will  vest in equal
instalments  on each of the  first  four  anniversaries  of the  closing  of the
Company's follow-on offering in November 2004.

In March 2005, the Company sold 3,500,000  shares in a public offering in the US
to fund the  acquisition of the two vessels and to repay  outstanding  debt. The
offering was priced at $49.50 per share,  and net proceeds (after offering costs
of $ 11.1 million) to the Company were $162.1 million. The Company issued 76,658
restricted  shares  to the  Manager  as a result  of this  offering  (see Note 7
Share-based Compensation).

In May 2005 Mr.  Andreas Ove Ugland has  exercised a right to sell his shares in
IUM Shipmanagement AS (IUM) and does no longer hold any interests in IUM.

<PAGE>
<TABLE>
<CAPTION>
ITEM 19. EXHIBITS
<S>    <C>
1.0*   Memorandum of Association  and Bye-Laws of Nordic  American Tanker Shipping
       Limited,   incorporated  by  reference  to  Exhibits  3.1  and  3.2  in  the
       Registration  Statement of Nordic  American  Tanker  Shipping  Limited filed
       August 28, 1995 on Form F-3,  Registration  No. 33-96268 (the  "Registration
       Statement").

4.1*   Form of Bareboat  Charter between Nordic  American Tanker Shipping  Limited
       and BP  Shipping  Ltd,  incorporated  by  reference  to Exhibit  10.3 in the
       Registration Statement filed on Form F-3, Registration No. 33-96268.

4.2*   Form of  Management  Agreement  between  Nordic  American  Tanker  Shipping
       Limited and Ugland Nordic  Shipping AS  incorporated by reference to Exhibit
       10.8 in the Registration Statement on Form F-3, Registration No. 33-96268.

4.3*   Novation  Agreement  dated May 30, 2003,  among Ugland Nordic  Shipping AS,
       Scandic  American  Shipping Ltd. and Nordic American Tanker Shipping Limited
       incorporated by reference to Exhibit 4.3 in the Annual Report for the fiscal
       year ended  December  31, 2002 on Form 20-F,  filed with the SEC on June 27,
       2003.

4.4    Amended  and  Restated  Management  Agreement  dated June 30,  2004  between
       Scandic American  Shipping Ltd. and Nordic American Tanker Shipping Limited,
       as further amended on October 12, 2004.

4.5    2004 Equity Incentive Plan.

12.1   Rule 13a-14(a) Certification of the Chief Executive Officer.

12.2   Rule 13a-14(a) Certification of the Chief Financial Officer.

13.1   Certification of the Chief Executive Officer pursuant to Section 906 of the
       Sarbanes-Oxley Act of 2002.

13.2   Certification  of the Chief  Financial  Officer  pursuant  to  pursuant  to
       Section 906 of the Sarbanes-Oxley Act of 2002.

23.1   Consent of Deloitte Statsautoriserte Revisorer AS

-------------
* Incorporated herein by reference.
</TABLE>


<PAGE>

                                   SIGNATURES

         The registrant  hereby  certifies that it meets all of the requirements
for  filing  on Form  20-F  and  that it has  duly  caused  and  authorized  the
undersigned to sign this annual report on its behalf.

                             NORDIC AMERICAN TANKER
                             SHIPPING LIMITED


                             By: /s/ Herbj0rn Hansson
                                 -----------------------------
                                 Name:    Herbj0rn Hansson
                                 Title:   President

DATED:  June 30, 2005





01318.0002 #583523