Smedvig Secures New Drilling Contract for West Navion

A letter of intent for an exploration drilling contract has been awarded to Smedvig by the Badr Petroleum Company (Bapetco), a joint venture company between Shell Egypt and the Egyptian General Petroleum Corporation, for the assignment of the deep water drillship West Navion.

The contract includes drilling of two wells in 1500 and 1800 meters of water in the eastern Mediterranean with option for a third well. The estimated contract value for the first two wells is approximately USD 11-12 million. Estimated drilling period for the first two wells is 60 days.

West Navion will be mobilized to Egypt under the new contract immediately after completion of the existing Statoil contract. Dependent on the duration of the mobilization period, the mobilization fees are estimated to USD 3-7.5 million. Start-up of drilling operations is scheduled for sometime between December 15, 2000 and February 1, 2001.

The letter of intent is subject to agreement on final contractual terms and conditions.

Smedvig ASA is an offshore drilling contractor headquartered in Stavanger, Norway. The company provides services within well construction and well services in the North Sea and South East Asia. Smedvig's main activities are divided into mobile units, platform drilling and tender rigs. Smedvig has a fleet of five modern drilling rigs, one deep water drillship and nine tender rigs. In addition, the company holds contracts for production drilling, well services and maintenance on fixed installations.