OYO Geospace Receives $7.0 Million Order for Seabed Acquisition System

OYO Geospace reported that the Bureau of Geophysical Prospecting (BGP), one of the world's largest seismic data acquisition service contractors, entered into a $7.0 million sales contract with the company for a retrievable seabed data acquisition system. The 4,000 channel, four-component data acquisition system marks the first purchase by BGP for a product from OYO Geospace's suite of reservoir characterization systems. The company expects to deliver this system in the third quarter of fiscal year 2006. Upon delivery and acceptance of the system by BGP, the company expects to recognize $6.3 million of the contract revenues. After the system has successfully operated for a specified time period, the company expects to receive and recognize the remaining $0.7 million of the contract revenue in the first quarter of fiscal year 2007.

"We are very pleased that BGP selected our product for their entry into the international seabed seismic data acquisition market. We are hopeful that this marks the beginning of a long and fruitful relationship between BGP and OYO Geospace in the development of this new market," said Gary D. Owens, OYO Geospace's Chairman, President and CEO.

"This sales contract is the third reservoir characterization system scheduled for delivery by the company in fiscal year 2006. In October, the company shipped the first of its new slimhole seismic data acquisition system for borehole applications. In December, the company announced the receipt of an award for a $7.6 million contract to deliver another permanent seabed system to BP for use in the North Sea. The seismic reservoir characterization market is a growing market for OYO Geospace. We are hopeful that further seismic reservoir product related opportunities will come our way during the remainder of this fiscal year," continued Owens.

Mr. Wang Tiejun, President of BGP, said, "BGP is building a seismic fleet consisting of two deep sea ocean bottom cable (OBC) seismic vessels in china. This OBC fleet will be equipped with OYO Geospace's four-component armored-cable seabed seismic data acquisition system. With these systems, BGP will be able to provide advanced high-definition reservoir seismic services to oil companies worldwide."