SeaDrill Makes Voluntary Offer for All Outstanding Shares in Smedvig

SeaDrill Limited announces a voluntary offer for all the outstanding shares in Smedvig ASA.

The offered price is NOK 205 per Smedvig class A share ("SME") and NOK 165 per Smedvig class B share ("SMEB").

The Offer is subject to only one condition which is that a total acceptance level of more than 50% of the SME shares is attained. The Offer will be withdrawn if this condition is not either met or waived prior to completion of the Offer.

The offer period will last until 16.30 CET on Friday January 3, 2006.

Shareholders in Smedvig submitting an acceptance form of the offer to Carnegie by 16.30 CET on Friday, January 13, 2006, by fax +47 22 00 99 60, hand delivery or post will receive cash settlement on or about Wednesday, January 18, 2006 provided they submit necessary settlement details as described in the Acceptance Form.

SeaDrill reserves the right, at its sole discretion, at any time to waive the condition referred to above, and/or to withdraw the Offer at any time, and/or to extend the Offer period by up to an additional 7 days.

The Offer is fully financed through a combination of available cash in SeaDrill and committed bank debt.

The combination of SeaDrill and Smedvig will create a major Norwegian-based drilling company listed on the Oslo Stock Exchange. Smedvig's highly competent organization will enhance SeaDrill's operations and improve SeaDrill's offering to its customers. Smedvig's mobile drilling fleet is considered one of the most modern in the world with a leading position in the market for deepwater and harsh environment drilling units. Smedvig is the world's leading operator of self-erecting tender rigs and also offers well services on fixed installations in both the Norwegian sector and the UK sector of the North Sea.

The Offer is an important step in SeaDrill's strategy to be a consolidator in the rig industry. SeaDrill and Smedvig are complementary companies which together would create an attractive industrial platform. The combined company will be a leading supplier of high quality and cost-efficient drilling and service units to the offshore oil and gas industry, as well as a provider of production drilling, wireline operations and engineering services.

Chairman of SeaDrill, Mr. John Fredriksen, says in a comment: "We are pleased that we are able to proceed with this offer and pursue a combination of the two companies. SeaDrill has reacted to strong encouragement from many of the larger Smedvig shareholders to create a sound industrial platform through combining the two companies. We have also noted the support expressed from Smedvig management for such a transaction.

"The combined company will be a strong and robust drilling company with attractive prospects from both the existing portfolio and the newbuild program."

Smedvig shareholders who want to accept the Offer need to submit their acceptances to Carnegie by 16.30 CET on Friday, January 13, 2006, by fax +47 22 00 99 60, hand delivery or post. SeaDrill's financial advisors, Carnegie ASA and Pareto Securities ASA, may also be contacted by telephone at +47 22 00 93 00 (Carnegie ASA) or +47 22 87 87 00 (Pareto Securities ASA) for questions pertaining to the Offer.