EMEPMI Terminates Contract for Atwood Seakhawk Early

Atwood Oceanics reports that ExxonMobil Exploration & Production Malaysia Inc. ("EMEPMI") has given written notice in accordance with the early termination provision of the contract that they will terminate the SEAHAWK contract upon the completion of work in progress on June 29, 2004. The contract provides for a demobilization fee of $1.8 million. The rig has been contracted by EMEPMI since 1992. Additional work will be pursued in Southeast Asia as well as other areas of the world.