SCAN agrees to vessel sale, lease-back

SCAN Geophysical ASA has agreed to a sale/lease-back arrangement covering its three newbuild 3D seismic vessels. Ship Finance International Ltd. will pay $210 million for the vessels with a lease-back to SCAN covering 12 years with purchase options after 6, 10 and 12 years.

Offshore staff

OSLO, Norway --SCAN Geophysical ASA has agreed to a sale/lease-back arrangement covering its three newbuild 3D seismic vessels. Ship Finance International Ltd. will pay $210 million for the vessels with a lease-back to SCAN covering 12 years with purchase options after 6, 10 and 12 years.

The vessels are purpose built at ABG Shipyard in India for efficient 3D seismic acquisition with streamer capacity of 10 tow points and streamer lengths up to 10 km (6.2 mi) for up to eight streamers.

"We are very pleased to team up with Ship Finance for our core seismic vessel fleet, as their total fleet is one of the largest in the world", says Lars Johan Frigstad, president and CEO of SCAN. "The seismic market is currently very healthy and we see promising outlook for the three state of the art vessels in the years to come."

Upon delivery from the shipyard, the vessels begin 12-year bareboat contracts to SCAN, and the charter rate per vessel, including the seismic equipment (8 x 6 km streamers), is agreed to be approximately:
Year 1-3: $26,500 per day,
Year 4-6: $24,500 per day, and
Year 7-12: $10,000 per day.
SCAN has fixed price purchase options for each vessel after 6, 10 and 12 years at approximately $20 million, $14 million and $9 million, respectively.

Delivery dates for the vessels now are scheduled from the yard to be January, April and July 2008.

3/20/2007

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