PGS Expects Improved Marine Contract Margins in 2006

Petroleum Geo Services ASA reported at its annual Capital Markets Day that the Company expects improved contracts margins for Marine Geophysical in 2006 compared to 2005. Furthermore PGS guided that Marine Geophysical multi-client late sales are expected to be lower in 2006 than in 2005. Multi-client investments in Marine Geophysical are expected to be modestly higher in 2005. Capital expenditures in Marine Geophysical are planned to increase to further boost productivity.

PGS Onshore revenues and operating profit are expected to be significantly above 2005 levels.

For PGS Production the following guidance was given:

- Oil production expected to decline for FPSO Petrojarl Foinaven producing the Foinaven field and FPSO Petrojarl I producing the Glitne field in 2006 versus 2005

- Potential for improved output for FPSO Petrojarl Varg producing the Varg field in 2006 versus 2005

- FPSO Ramform Banff producing the Banff field is expected to continue at the minimum day rate

As an update on the refinancing and exploration of a possible separation of the Company, PGS President and CEO, Svein Rennemo stated the following:

"Our refinancing process is on track and, as disclosed last week, as of the consent solicitation deadline on November 30, 2005 tenders and consents representing approximately 99 percent of the $745.9 million aggregate principal amount of our outstanding 10% Senior Notes due 2010 had been received.

We have started the process of exploring separation possibilities as announced and will come back with information to the market when appropriate. The strong market outlook for both our Geophysical and Production businesses underlines the potential in fully exploiting the growth capability and opportunities within each one of them independently of the other. We believe that direct access to the capital markets for both Geophysical and Production would allow us to capture more opportunities."


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