KCA DEUTAG Receives Prince Andrew in Sakhalin, Russia

Prince Andrew has made the first visit to the Russian Island of Sakhalin by a member of the British royal family and he visited the offices of Aberdeen based drilling contractor, KCA DEUTAG.

The Duke of York is visiting Sakhalin from April 27 - 30, 2004 in his capacity as the UK's Special Representative for International Trade and Investment to lend support to British business on the island, which hosts a sizeable and growing oil industry.

Graham Cowperthwaite, Director of Development Projects, and Larry Stamp, Country Manager - Sakhalin, introduced the Duke to KCA DEUTAG's operations.

KCA DEUTAG has a contract with Sakhalin Energy Investment Company Ltd. ("SEIC") valued at approximately US$250 million.

This requires KCA DEUTAG to carry out platform drilling services for seven years on the Molikpaq platform, together with the platform drilling services on the Lunskoye-A ("LUN-A") and Piltun B ("PA-B") platforms, scheduled for 2005 and 2006 respectively.

An additional scope of work requires KCA DEUTAG to provide engineering support to SEIC's design contractor for the LUN-A and PA-B drilling facilities.

This complements the company's existing contract with Hyundai Heavy Industries (HHI) for the Sakhalin-1 Project in the Russian Far East, announced in late 2002.

The Duke of York was introduced to all staff and had questions for everyone. "The Prince was clearly interested and spent an hour with us," explained Larry Stamp.

Maurice White, Chief Executive of KCA DEUTAG commented: "The Duke of York's visit reflects the growing involvement of British companies like KCA DEUTAG in Sakhalin Island, which is fast becoming one of the most important areas in the world for the oil and gas industry."

The objectives of The Duke of York's visit are to raise the profile of British industry in Sakhalin, in particular Shell and BP and other British infrastructure investments. And secondly to look at opportunities for small and medium British companies as sub-suppliers for Russian oil and gas contracts. During the visit The Duke of York will meet with the representative of Governor Malakhov and meet both members of the British, Russian and international business communities. He will open the new Sakhalin Energy offices and visit Russia's first ever Liquid Natural Gas plant where he will open the new cement batch plant. Russia is world's biggest exporter of gas and the LNG plant has given them access to new markets in the Far East.