Aker Exploration: Ready to Take on NCS Projects

Aker's oil and gas exploration company, Aker Exploration, is ready to take on Norwegian Continental Shelf projects. The company, which has been prequalified as a licensee, today entered into a drilling rig charter agreement - and is negotiating with an oil company to swap exploration drilling for ownership stakes in offshore licenses.

Aker Exploration is prepared to break through an impasse that is inhibiting oil and gas exploration on Norwegian Continental Shelf, says Leif-Arne Langoy, Chairman and CEO of Aker ASA.

Oil companies are struggling to get a hold of drilling rigs for limited contract periods. In today's tight rig market, such short-term drilling contracts are unattractive to rig companies, Langoy explains. - Aker Exploration's solution is to offer top-notch know-how and drilling capacity in exchange for an ownership interest in offshore licenses.

Norway's Ministry of Petroleum and Energy recently prequalified Aker Exploration as a Norwegian Continental Shelf license holder. The prequalification system was established to facilitate the entry of new, competent participants on the Norwegian Continental Shelf and to foster greater value creation, according to the Ministry.

Aker Exploration is currently in negotiations with oil companies regarding receiving license stakes in return for conducting offshore exploration drilling. The first such agreement is expected to be signed by year-end 2006.

Aker Exploration will be a focused offshore exploration company, and a partner helping oil companies and public authorities to find more oil and gas on the Norwegian continental shelf. Aker will consider inviting other investors to join as Aker Exploration owners. The proper timing of such investments is assessed on an ongoing basis.

Aker Exploration has entered into an agreement with the listed rig company Aker Drilling on a tentative three-year contract for a drilling unit that will be ready for field operation as of October 31, 2008. The agreement features an option to extend the contract by an additional two years. Aker Exploration is paying US $10 million to reserve the drilling rig through December 2006. A final, confirmed drilling contract covering the period from October 2008 to October 2011 will have a possible total value of approximately US $610 million.

The aforementioned drilling rig is the advanced, semi-submersible Aker H-6e drilling unit, which is specially designed for drilling in ultra-deepwaters, harsh environment and in cold climates. The Aker Kværner MH Dual RamRig drilling systems provide excellent operations efficiency to the clients.

The Aker H-6e drilling units are constructed for exploration and production drilling of wells that run more than 10,000 meters in length and for deployment at water depths ranging from 100 meters to 3,000 meters.

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