Delays Continue to Plague TGS Seismic Vessels

Last month TGS-NOPEC Geophysical Company issued a message to the Oslo Stock Exchange providing expected timetables for when the M/V Geo Barents and the M/V BGP Pioneer would commence production. Now, following the delivery of the M/V Geo Barents and the receipt of a new schedule for the return of the M/V BGP Pioneer, TGS issues an update on the projected impact of lost production time of these two contracted 3D vessels to the Company's 2007 full year guidance.

The Geo Barents sailed from the shipyard in Norway on Saturday July 7th, and is now expected to mobilize in the Gulf of Mexico on or about July 25th. This represents an additional delay of approximately 3 weeks compared to the June 11th message.

The BGP Pioneer is currently in drydock undergoing propeller repairs, and is now expected to mobilize for a proprietary contract project on July 20th. This represents an additional 1 month delay from the expectations TGS communicated on June 11th.

As a result of the lost production time within the 2nd and 3rd quarters of 2007, the management of TGS now updates its expectations for the full year 2007 to be:

  • Multi-client library investments of USD 160- 170 million, (down from 175- 185 million)
  • Net revenue growth of 15-20%, (down from 20-25%)
  • Pre-funding on investments of 50-60% (unchanged)
  • Amortization rate of 28-33% of net multi-client revenues (unchanged)

The 2nd quarter of the year carried the heaviest impact of these delays, and consequently net revenues for Q2-07 are now expected to be approximately 8% above Q2-06.

The interim results for Q2-07 will be presented on August 9th.