Petrojack Issues Fourth Quarter Results

Petrojack has two jack-up rigs under construction at the Jurong Shipyard in Singapore. The jack-up rigs have an operating water depth capacity of 375 feet and drilling depth capacity of approximately 30,000 feet. The jack-up rigs are scheduled for delivery in 1st and 4th quarter 2008.

Petrojack's original construction program included four rigs. However, two rigs were sold to Maersk in Q3-2006, for a total consideration of MUSD 420.

The total rig construction cost for the remaining two jack-up rigs are MUSD 140 (including PC-sum and financing) with 80 percent yard financing during the construction period for Petrojack II. Petrojack II is scheduled for delivery during first quarter 2008. The construction cost for Petrojack IV is MUSD 180 (including PC-sum and financing). Delivery date is 4th quarter 2008.

In August 2006, Petrojack invested in Petrolia Drilling ASA - Petrojack currently holds about 23.6 % of Petrolia Drilling ASA. The investment gives Petrojack exposure to the strong semi market, which has continued to develop positively during 2006/2007, with improving day rates and rig utilization.

Petrojack has subscribed 24.450.800 shares in PetroProd Ltd, and bought a forward contract of 12.383.000 shares in PetroProd Ltd with 25 March 2008 delivery, giving a total ownership of 42.1%. PetroProd is converting three Aframax tankers to FPSOs at Jurong, and has ordered an enhanced CJ70 jack-up rig from Jurong. PetroProd has identified a number of employment opportunities on the Norwegian sector for a large Jackup like CJ70 capable of providing combined a simultaneous drilling and production. The company expects to be able to secure a long-term drilling and production contract ahead of additional funding requirements.

The contract for Petrojack has duration of 4 years, commencing upon delivery of the rig from Jurong.

The hire under the contract is USD 100.000 per day. The Charter Agreement includes a put/call option at a price of USD 200 million, 12 months after the beginning of the contract.

There have been no significant lost time accidents, and the construction processes are developing according to schedule and on budget.