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Offshore

Offshore staff

SYDNEY, Australia -- BW Offshore and Anzon Energy Ltd. have signed a letter of intent for the design, conversion, installation, and operation of an FPSO for the Basker-Manta-Gummy Joint Venture oil and gas fields offshore Australia.

BW Offshore will convert the tanker BW Endeavour from its inventory. The FPSO will have a processing capacity of 40,000 b/d of oil and up to 120 MMcf/d gas with a storage capacity of 800,000 bbl of oil.

This new single vessel will replace the combination of the mini-FPSO and shuttle tanker that has been the trademark of the Basker Manta development since it started.

The FPSO is scheduled for operation in early 2Q 2010. The contract is for a five years fixed, plus options to extend the contract for up to a total period of 15 years. The contract has a nominal value for the total period of up to 15 years, including installation, of $1.3 billion.

The BMG JV is expanding its oil & gas development in the Gippsland Basin (Vic L26, L27 and L 28) and also has entered into a LOI with Songa Offshore AS for the semisubmersible Venus for commencement of drilling in November 2008. This rig will supplement the Maersk Kan Tan IV which will begin drilling in May 2009.

Between the two rigs, some four development wells targeting both Intra-Latrobe and Golden Beach sands, and possibly one or two appraisal/exploration wells will be drilled. Plans are to connect with manifolds and risers to the FPSO via the APL disconnectable submerged turret production buoy, including swivel stack and mooring system, also being delivered by BW Offshore.

The operating lease contract for the FPSO is expected to be finalized before the end of September 2008, and commissioning in Bass Strait is expected 2Q 2010.

07/07/2008