Ocean Rig's Eirik Raude Awarded Contract

Ocean Rig ASA announced that it has entered into certain agreements with PanCanadian Petroleum Limited relating to Bingo 9000-2, the semi-submersible drilling rig known as Eirik Raude. The agreements are subject to the receipt of necessary consents by Ocean Rig's secured creditors.

The rig is scheduled to commence drilling under the contract, which provides for a firm period of six to eight months, after it has been delivered from the construction yard. The gross revenues under this contract will amount to approximately USD 35 million to USD 60 million, depending on operational performance and actual contract length. In addition, Ocean Rig will receive USD 15 million for the cost of necessary upgrading and mobilization costs. The contract also provides for up to three optional wells with an estimated additional gross revenue of up to USD 30 million, assuming a five month option period.

Ocean Rig plans to contact its secured creditors as soon as possible seeking consent for certain amendments to its existing credit documents. The Company intends to obtain this consent during the next quarter.

Under the terms of the agreements, Ocean Rig and PanCanadian will form a partnership which will ultimately lease Eirik Raude from Ocean Rig. The partnership will allow PanCanadian and Ocean Rig to take advantage of their respective experience and expertise to undertake deepwater drilling offshore the East Coast of Canada. Ocean Rig has been marketing its units for the offshore regions of Nova Scotia and Newfoundland and Labrador for some time, recognizing the potential for deepwater drilling offshore both provinces. There are approximately 30 deepwater licenses active at this time, with substantial work commitments by a number of major international and Canadian operators offshore these provinces.

For Ocean Rig, this drilling contract represents a significant milestone, both ensuring Ocean Rig's presence in an area where harsh environments combined with deep water allows optimal use of the rig and providing recognition of Ocean Rig as an integrated drilling contractor.

Ocean Rig expects to commence operations with Eirik Raude offshore East Coast Canada at year end 2001.

PanCanadian is a leading North American energy company active in the exploration, development, production and marketing of natural gas, crude oil and natural gas liquids. The East Coast of Canada is one of PanCanadian's core areas, where it holds land holdings covering 4.4 million gross acres.