Smedvig Secures Contract for the Newbuild West Setia

Smedvig has been awarded a letter of intent by Murphy Sabah Oil Co. Ltd for the new self-erecting semi-tender rig West Setia. The production drilling assignment has a duration of approximately 800 days, and the contract value is estimated to US$ 60 million. Commencement of operations is scheduled for September/October 2006.

West Setia is presently under construction, scheduled to be delivered in August 2005. The new semi-tender is based on a similar but improved design and specification as Smedvig's West Alliance. West Setia is designed for both shallow and deepwater drilling operations in combination with dry well wellhead platforms. For deepwater this is mainly tension-leg platforms (TLP's) or Spar platforms. This deepwater development drilling concept is expected to give significantly lower drilling costs, lower capital expenditure and more cost-effective well intervention and maintenance.

West Setia is to drill production wells in combination with a Spar platform on the Kikeh field at a water depth of approximately 1000 meters offshore Malaysia.

Final contract award is subject to approval by Petronas Bhd.

Stale Rod, Managing Director in Smedvig Asia says: "This is the first ever project where a tender rig is being utilized for drilling from a Spar platform. Smedvig was also the first ever to utilize a tender rig to drill from a deepwater TLP wellhead platform offshore Indonesia in 2003. This is a concept now being recognized as a very cost effective drilling solution for deepwater developments".