The Board of Directors considers that the market for mobile drilling units in Asia has now reached a rate level where a reactivation of the three drilling units that the Company currently has in lay-up in Singapore could be of financial interest. Work of this nature would make it necessary to establish a solid local base by strengthening the Company's personnel resources in Asia in connection with reactivation, marketing and technical operation of the Company's drilling units.
On the basis of an assessment of the market, the Company's Board of Directors expects that the drillship Northern Explorer III will be the first of the Company's units to be put into operation.
Earlier this year, Northern Offshore acquired the drilling contractor Jet Drilling, which is based in Singapore. Jet Drilling is a recognized drilling contractor in Asia, and has been highly successful in procuring work for the rigs that this company has operated. Jet Drilling currently has operating and marketing responsibility for Northern Offshore's drillship Energy Searcher.
The Board of Directors of Northern Offshore is willing to provide Jet Drilling with the financial and personnel resources necessary to present the rigs of Jet Drilling and Northern Offshore as attractive drilling units to oil companies in Asia.
As part of the increased focus on the Asia market, the Board of Directors considers it appropriate to reduce the activities of Northern Offshore Management AS in Oslo, Norway. It is expected that a total of six people will be affected in connection with the transfer of most of the functions currently held by the office in Oslo to the Company's Singapore office, and to Northern Offshore Ltd's head office in Bermuda. The operation of the Company's production unit, Northern Producer, will continue unchanged from Aberdeen through PGS Production Services Ltd.
President and CEO Kai Solberg-Hansen will assist in implementing the reorganization of the Company, in close cooperation with the Board of Directors. The future day-to-day management of the company will be clarified when the relocation of the Company's functions has been completed.
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