Prosafe to Concentrate on Floating Production Services

Prosafe has entered into an agreement with KCA Deutag Drilling Norge AS to sell all its shares in Drilling Services to KCA Deutag. The transaction is expected to close in the third quarter of 2005 after completion of confirmatory due diligence.

Estimated net proceeds, which will include the cash in the Drilling Services business at closing and a net current assets adjustment at closing, are expected to be approximately NOK 960 million. The entire consideration will be paid in Norwegian Kroner.

The sale of the Drilling Services Business represents the next step in Prosafe's strategy. The sale will allow Prosafe to focus its managerial and financial resources on its Floating Production and Offshore Support Services divisions. These resources will be harnessed to further develop the Floating Production and Offshore Support Services' positions in fast growing offshore markets.

Drilling Services is one of three operators on the Norwegian Continental Shelf active in production drilling from clients' fixed offshore installations, and has a market share of approximately 30%. Drilling Services is headquartered in Bergen, had 2004 operating revenues of NOK 1,451 million, profit after tax of NOK 59.7 million and currently has 870 employees.

Goldman Sachs International acted as financial advisor to Prosafe in connection with this transaction.