GE Energy et al Boost Production 30,000 Barrels

Two units of GE are joining forces with oil drilling and production technology company Sevan Marine ASA of Norway, Oilexco North Sea Ltd. of Scotland, and a Chinese and other international shipyards to deploy an innovative cylindrical floating oil production, storage and offloading unit that can process 30,000 barrels of crude oil per day and store 300,000 barrels.

Sevan Marine's affiliate Sevan Pte Ltd signed an agreement for a US $300 million senior debt project finance facility for the Sevan Voyageur with mandated lead arrangers GE Energy Financial Services and GE Transportation Finance. GE Capital Markets will syndicate the facility, fully underwritten by the lead arrangers, to a limited group of international banks. Norway's export credit agency, GIEK, has partially guaranteed the facility. Eksportfinans funded GIEK's portion of the facility.

As the search for oil shifts to areas without sub-sea pipelines and to smaller and marginal offshore fields, the floating unit offers a smaller, more cost-effective means of production, storage and offloading. Compared to other floating production, storage and offloading units, the Sevan Voyageur, based on Sevan's proprietary technology, can operate more efficiently and in harsher weather, with reduced maintenance, and is easier to re-deploy.

The Sevan Voyageur, the third unit in its class, is expected to be installed in the Shelley Field in the UK's central North Sea during the fourth quarter of this year, and will operate under a five-year contract with Oilexco North Sea Ltd, a subsidiary of Oilexco, Inc. of Canada (LSE: OIL; TSE: OIL). Yantai Raffles Shipyard in China's Shangdon Province built the hull, Norway's GKSI shipyard built the topside processing plant, and the Keppel Verolme Shipyard in Rotterdam, the Netherlands, is installing the topside on the hull. The debt facility is structured as a limited recourse financing consisting of a pre and postcompletion construction financing of up to US $300 million that converts into a 5-year US $300 million amortizing term loan following delivery of the Sevan Voyageur to Oilexco North Sea. With this facility and the funding raised by Sevan in September 2007 under a NOK 870 million bond issue, the Sevan Voyageur is now fully financed.

"This bank facility completes the financing of the second Sevan floating, production, storage and offloading unit to be installed in the North Sea," said Jan Erik Tveteraas, CEO of Sevan Marine. "We now have five Sevan units contracted to clients, with an ambition of expanding the fleet further. The financing GE and its partners, including GIEK, are providing has played an important role in our company's development."

GE has worked with Sevan Marine twice previously: on the financing of a sister floating production, storage and offloading unit, the Piranema, deployed off Brazil, and of the Sevan Driller, an oil and gas drilling vessel to be deployed in the ultra-deep waters of the US Gulf of Mexico.

"This extension of our relationship underlines our trust in Sevan's management and the innovative solutions it is bringing to the floating production market," said Ron Petrunoff, Executive Vice President and General Manager, GE Transportation Finance.

Matt O'Connor, Managing Director and leader of debt finance at GE Energy Financial Services, added: "GE's close relationship with Sevan Marine, our extensive oil and gas technical, underwriting and investing expertise, our growing focus on debt lead arranging and on global growth and technology all have combined to make this transaction succeed." GE Energy Financial Services' $5 billion debt portfolio spans oilfield services, pipelines, gas storage, refining, exploration and production, power, mining and fuel distribution. In addition to debt financing in oil and gas, GE Energy Financial Services maintains 22 partnership investments that produce an estimated 88 million cubic feet of natural gas and 9,400 barrels of oil daily from onshore basins and shallow-water Gulf of Mexico.

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