Rig delivery not accepted

October 21, 1999, 17:00 CEST

Statoil refuses to accept delivery of the converted drilling rig Borgland Dolphin whose owner Fred Olsen Energy claims to be ready for delivery shortly.

Statoil maintains that the terms of the contract have not been fulfilled. Statoil has raised the matter of the remaining work with the owner but to date a satisfactory clarification has not been reached.

The agreement which was entered into in the summer of 1997 between Statoil and the wholly owned Fred Olsen subsidiary Dolphin, concerns the use of the rig over a six-year period. BorglandDolphin has undergone conversion at the Harland & Wolff shipyard in Belfast, Northern Ireland. According to the agreement between Statoil and Dolphin, the rig should have been delivered in the third quarter of 1998.