Northern Offshore Sells Drillship

The Board of Northern Offshore Ltd. has approved the sale of the drillship Northern Explorer II. The rig was sold for US $2.1 million. The decision to sell the rig, which has been laid up since 1998, has been taken after a thorough evaluation of the total costs it would take to upgrade the rig to operational condition. The Board also paid attention to the reduction in the Company's operating cost which will be achieved through the sale of the unit. The rig will be delivered shortly.

As a direct function of the assets sale Northern Offshore will take an extra write down of approximately US $4.2 million in the 4th quarter 2003.