Smedvig to Build New Semi-Tender

Smedvig has entered into an agreement with Keppel Shipyard in Singapore for the purpose of building a new semi-submersible self-erecting tender rig (semi-tender). Total capital expenditure for the new semi-tender is estimated at $ 94 million, of which Smedvig's share is approximately $ 29 million. The agreement with Keppel Shipyard is based on the principle that Keppel shall build and own the the semi-submersible hull, and Smedvig shall own the derrick equipment set. Smedvig shall for a period of ten years be responsible for marketing, management and operation of the unit. The agreement includes an option for Smedvig to purchase the semi-submersible hull during the ten-year period at a pre-agreed price. The new semi-tender will be based on a similar but improved design and specification as Smedvig's West Alliance. The new unit is targeted for deepwater drilling operations in combination with floating wellhead platforms such as TLPs and Spars in benign waters. The new rig is scheduled for delivery in the third quarter 2005. Kjell E Jacobsen, CEO in Smedvig asa says: "This investment reinforces our position as the leading tender rig operator."