Songa Mercur update

The Songa Mercur is currently off-hire in China resulting from structural
failure of the telescopic joint, causing an uncontrolled descent of the BOP and
Marine riser a short distance to sea bed on 16 January 2011. The rig was not
drilling at the time of the incident and the BOP is in safe distance from the
well which had already been plugged and secured.

The Company foresee that all required resources are readily available in area
for a safe and effective recovery.  The incident is currently under
investigation and further updates to the recovery process will be issued when
details and facts are available.

The on-going well was near its final stages at time of incident and rig had been
planned to be towed to Singapore area after well completion in preparation for
upcoming and future contracts. Henceforth, the Company does not foresee any
significant cost impact to budgets and/or projections resulting from the
incident.

20 January 2011
Limassol, Cyprus
This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)






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Source: Songa Offshore SE via Thomson Reuters ONE

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