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BRAEMAR SEASCOPE OFFSHORE Asia & Australia Report MARCH 2011

ISSUE: 5

NEW VESSEL CHARTERS & DISCOVERIES MARKET NEWS & ANALYSIS VESSEL DAYRATE CHARTS Picture Courtesy of CloughHelix

©Braemar Seascope Offshore

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Online Edition

We have been developing a new look to the established and well received Braemar Seascope Offshore Asia & Australia Report. The new design brings our tried and tested formula up to date and inline with new technologies. You can now enjoy the full report from anywhere simply by clicking the picture above and viewing the report online.

We are also seeking to offer additional services on the Asia & Australia vessel market soon in our mission to offer a truly comprehensive news service for all Braemar Seascope Offshore clients.

We’ve also added in more analysis and more charts, data and graphs.

We hope you enjoy the changes and look forward to hearing your feedback, comments and suggestions that will help to improve the experience of all of our readers further. Our more interactive feel will be adopted across our full suite of reports so please feel free to contact us.

We will also be seeking to constantly improve our reports going forward with additional features, elements and enhancements coming soon. In the meantime enjoy this month’s report, Sean Bate Market Analysis Manager

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We are pleased to announce that we now have an online edition of our report. This can be viewed by clicking the link on the picture to the left. The online viewer enables you to read the report in magazine format on the screen. Readers can also zoom in to pages, skip to particular pages of interest and use the built in links to utilise the contact email address or provide feedback. We hope you enjoy using this new facility and look forward to providing further interactive elements soon.

New Arrivals

Braemar Seascope Offshore’s Singapore department has recently moved into a new office space (pictured above).

The new office brings Braemar Seascope’s Singapore-based Offshore division under the same roof as the Tankers and Dry Cargo elements as well as the Braemar Falconer and Braemar Steege divisions that deal with technical and insurance aspects respectively.

For further details of the full range of services offered by Braemar Shipping Services - click here.

Please update any details that you hold accordingly. Please note that telephone numbers and email addresses will remain unchanged.

The new address for Braemar Seascope Offshore in Singapore is now: 1 Pickering Street #08-01 Great Eastern Centre Singapore 048659 We have a permanent staff of three offshore brokers in Singapore: James Sherrard, Søren Nielsen and Nana Lai. They are supported by our directors in London and Aberdeen and Candice Wu who frequently travels to the region.

The Singapore office deals with Sale and Purchase, Long Term and Short Term Vessel Chartering and Vessel Valuations throughout the Southeast Asia region.

The past few weeks have seen an increase in the demand for highspecification tonnage in the Asia and Australia region. Whilst Australia has taken top of the range vessels for some time there is now increasing demand for the best vessels in other regions too. CNOOEC’s recent charter of the Normand Clough for work in the South China Sea and the fixture of the Skandi Hercules for FPSO work in Southeast Asia are indications that a new market for high specification vessels could be emerging.

Chartering

Skandi Hercules Heads to Southeast Asia

The large AHTS vessel Skandi Hercules has left the North Sea for work in Southeast Asia. It is understood the vessel will be carrying out FPSO installation work in Vietnam and will remain in the region at the end of the contract and attempt to pick up additional work. The 2010-built Skandi Hercules is an AH-04 CD designed vessel with a 350t bollard pull and accommodation for 90 personnel.

Gulmar Atlantis Delivered Gulmar Offshore has taken delivery of the newbuild diving support vessel Gulmar Atlantis from the Hanjin shipyard in Busan, South Korea. The vessel is the first of two sister ships from the yard. They are equipped with an 18-man diving system with twin diving bells, a 140t active heave compensated crane, Fifi 2, a large deck area and helideck.

The Gulmar Atlantis is currently uncommitted. Gulmar's fleet consists of four DSV accommodation vessels.

Deep Sea Supply in Malaysia Partnership Deep Sea Supply has announced it has entered into an exclusive partnership agreement with two Malaysian partners, Efogen Sdn Bhd and a Malaysian government owned investment fund. The new partnership has also purchased the AHTS vessel Sea Weasel from Deep Sea. The vessel is currently on charter to Petrobas and will be equipped with Malaysian flag and managed by Deep Sea Supply.

The company hopes this will enable access to the vessel market in Malaysia which has strong cabotage rules.

CloughHelix Gets COOEC Subsea Work CloughHelix mobilised the Normand Clough in February to work on the Huizhou fields in the South China Sea. The vessel will be utilised for a minimum of 120 days following installation of a new 15 man saturation dive system. The Normand Clough will be helping to reinstate the field following damage to infrastructure caused by the Typhoon Koppu in September 2009.

ŠCopyright Braemar Seascope Offshore 2011

Chartering

Cairn to Drill off Sri Lanka

Cairn India has confirmed that drilling will take place in its licence offshore Sri Lanka. It is understood the operator has secured a drillship to begin work in July 2011. The latest development follows on from interpretation of data acquired during a 3D seismic campaign held in 2010.

Salamander Energy’s Thailand Exploration Salamander Energy has announced an upgrade to the reserves on the Bualuang oil field in the Gulf of Thailand. The company increased the gross proved reserves 111% to 14.6 MMbo with proved and probable reserves now standing at 27 MMbo. Salamander Energy has also announced plans for a further drilling campaign on the B8/38 licence to further develop and explore the field. The Ocean Sovereign jack-up rig has now been contracted until the end of June 2011 for the drilling campaign.

Swire Pacific Adds to Fleet Swire Pacific Offshore has acquired four AHTS vessesls that are being built at SekWang Heavy Industries in Korea.

The UT-786 designed vessels will be equipped with FiFi 2, DP2, 16,314 BHP and bollard pulls of around 190t. The vessels will be called Pacific Champion, Commodore, Centurion and Crusader. The first vessel had a delivery date of February 24th 2011 with the others expected in the third quarter of 2011 and the third quarter of 2012. The vessels had previously been cancelled by ER Schiffahrt.

FPSO Skarv Idun Towed from South Korea Fairmount Marine's tugs Fairmount Sherpa and Fairmount Summit have deliverd the FPSO Skarv Idun to the port of Stord in Norway. The tugs took 92 days to tow the vessel 15,300 nautical miles from Samsung Heavy Industries shipyard in Okpo, South Korea. The FPSO will be used by BP in the Northern Norwegian Sea. The unit will remain in Stord for final fitting out and preparation before being towed into position later in the month by the Fairmount tugs. ŠCopyright Braemar Seascope Offshore 2011

Australia/New Zealand

Farstad Secures Australia Charters

Farstad has been awarded long-term contracts in Australia. Apache Energy has taken on the AHTS vessels Far Scimitar (UT-712L) and the Far Sky (ME 303 MKII) for 14months firm to support drilling operations. Santos has also fixed the AHTS Lady Sandra (KMAR 404) and the Far Fosna (UT-722) for a 4-well contract from March. Meanwhile, Esso Australia has exercised a 3-month option on the PSV Lady Kari-Ann and McDermott has extended the AHTS Lady Cynthia for a further three months.

Woodside Strikes Gas with Martin Well Woodside has announced it has discovered gas wit the Martin-1 well in Australia’s Carnarvon Basin. According to reports from the operator approximately 100 metres of gross gas was encountered within the Triassic target. The Martin well is located within 14km of Woodside’s existing gas discoveries at Martell-1, Noblige-1, Larsen-1, Larsen Deep-1 and Remy-1.

New Zealand Drill Decision in Balance It is understood that OMV is currently mulling over a decision on whether to take a rig to the New Zealand area to commence drilling following seismic results on its Great South Basin permits. Meanwhile, Anadarko has recently been carrying out seismic work in the Canterbury basin off New Zealand with the possibility of spudding one or more wells later this year or early 2012. However, it is understood the company is investigating potential rig-share opportunities.

PNG Government Buys Into Nautilus The Government of Papua New Guinea has confirmed that it intends to take up to a 30% stake in the Nautilus Minerals’ Solwara 1 project in the Bismark Sea. The transaction will involve the government contributing funds to the project including a share of the exploration and development costs incurred to date. Nautilus Minerals is a commercial company aiming to explore the ocean floor for commercial mineral and metal deposits. ©Copyright Braemar Seascope Offshore 2011

Australia

Fugro Acquires TSMarine

Fugro N.V. has acquired Tsmarine Group Holdings Pty Ltd (TSM) and its subsidiaries. TSM, with its headquarters in Perth Australia and subsidiaries in Singapore, Labuan (Malaysia) and Aberdeen (UK), is a specialist provider of subsea construction, IRM (inspection, repair and maintenance) and light well intervention. The company operates ROV (Remotely Operated Vehicle) and diving services and has four high specification chartered vessels in its fleet. It is focused in the Asia-Pacific and Europe-Africa regions.

Workboats Ordered for Gorgon Project Strategic Marine has received a contract from the Leighton-Saipem consortium for delivery of four workboats for use on the Chevron operated Gorgon Project. The vessels, which will be built at the company's Henderson Shipyards, will be used to transport workers to and from construction barges operating at Barrow Island. The workboats will be capable of carrying up to 12 passengers each and are expected to be delivered later this year.

BP Awarded Four Australian Blocks BP has announced that it has been awarded four deepwater offshore blocks in the Cenduna Sub Basin within the Great Australian Bight, off the coast of South Australia.

The Exploration Permit for Petroleum (EPP) covers an area of 24,000 km2. BP has said that the proposed exploration activity will be phased over six years and will be subject to detailed environmental assessment. Seismic activity could commence in the summer of 2011/12 with drilling not expected until 2013 or 2014.

Otto Marine Acquires Go Marine Otto Marine has reached agreement with Go Marine Group Pty Ltd to have the option to acquire 49% and the remaining 51% of the company. The AUD 20 million deal, would see Otto Marine position itself to provide marine services to the potentially booming Australian oil and gas market. Otto Marine hopes to target major projects like Gorgon, Wheatstone, Browse Basin and the Inpex Icthys development. The ambition is for Go Marine Group to be one of Australia's largest ship operators. ŠCopyright Braemar Seascope Offshore 2011

Newbuilds

Second Vessel for Swire Blue Ocean

Swire Blue Ocean has declared an option to build a second windfarm installation vessel with Samsung Heavy Industries in Korea. The vessel, which is scheduled to arrive in Europe in early 2013, will be named Pacific Osprey and will be utilised on the DanTysk windfarm in the German North Sea. The sister ship Pacific Orca, which was originally due to perform the DanTysk work, will be committed to another European project.

Beluga Orders Cable-Lay Vessel Beluga Group has ordered its first cable-lay vessel with Lloyd Werft. The deal, which still requires confirmation by the German Government, also includes an option for a second vessel. The first vessel will be named the Beluga Connection with delivery mid 2012. The 110.8m-vessel is to be utilised laying cable in the Wadden Sea for NKT Cables. Beluga Hochtief Offshore is also building a jack-up capable of installing 120m-high turbines in 50m of water.

Seadrill Places Order for Two Tender Rigs Seadrill has entered into an agreement with COSCO Natong Shipyard in China for two new tender rigs. The T15 and T16 are scheduled for delivery in the first quarter and third quarter of 2013 respectively. Total project price is estimated to be USD 225 million. The two units will be based on similar designs to recently built tender rigs but with enhanced drilling capabilities. Both rigs have been contracted to Chevron Thailand Exploration and Production for a five-year period at a value of USD 420 million.

SBM Offshore & Mitsubishi Deal SBM Offshore has announced a long-term cooperation agreement with Mitsubishi Corporation to pursue FPSO projects worldwide. The deal will cover lease and operate projects and will be subject to the pre-existing agreements of the companies. Mitsubishi will be an equity partner with SBM Offshore for the ownership of FPSOs. SBM Offshore will supply the units and act as the operator. The pair have previously formed partnerships for the Yetagun FSO and Rang Dong FPSO lease contracts. ŠCopyright Braemar Seascope Offshore 2011

Corporate

Atwood Oceanics Orders DSME Drillship

Atwood Oceanics has executed a turnkey construction contract with Daewoo Shipbuild and Marine Engineering for an ultra deepwater drillship that will be named Atwood Advantage. The drillship will cost a total of around USD 600 million and is expected to be delivered by the end of September 2013. The vessel will be a DP3 dual derrick drillship rated to operated in water depths of 12,000 feet. It will have a 165-ton active heave knuckle boom crane and accommodation for up to 200.

PaxOcean Places Rolls Royce PSV Deal Rolls-Royce has announced an order from Singaporebased offshore company, PaxOcean to provide the ship design, propulsion systems and deck machinery for two platform supply vessels. The order also includes options for a further four vessels. The vessels are of UT-755 CD design and will be built at PaxOcean Engineering's Zhuhai yard in China with expected delivery in 2012.

AMC Connector Specs Finalised Aker Solutions has announced its planned specification for its newbuild subsea installation and construction vesel the AMC Connector. The vessel, which was perviously called Aker Connector, will be equippped with two turntables for high voltage power cables or subsea umbilicals and will have a transit speed of 16 knots. The AMC Connector which is set for delivery in early 2012 will also have two heave-compensated cranes with 400 and 50 tonne capacities. It will work for ABB in 2012 and 2013 on delivery.

Swift 10 Jack Up Being Completed Drydocks World has delivered the jack-up platform Swift 10 to Swift Drilling. The specialised platform, which was built at Drydock World's yard Nanindah in Indonesia, is expected to be deployed in European waters and be involved in windfarm installation activities as well as oil and gas work. An additional unit JB-116 is also currently under construction at Graha in Indonesia.

ŠCopyright Braemar Seascope Offshore 2011

Jan-04

£0

Large - AHTS (16,000+ BHP)

PSV Dayrates Medium - AHTS (12-15,999 BHP)

Average North Sea Spot PSV Rates 2004 2004--Present Jan-11

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£60,000

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Average North Sea Spot AHTS Rates 2004 2004--Present

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Average North Sea Spot AHTS Rates 2010 2010--Present

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Medium - AHTS (12-15,999 BHP)

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Average North Sea Spot PSV Rates 2010 2010--Present

Jan-11

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Braemar Seascope Offshore is a division of Braemar Shipping Services PLC, a leading integrated provider of brokering and consultancy services to the shipping industry.

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Sean Bate Market Analysis Manager 25 Carden Place Aberdeen AB10 1UQ UK Phone: +44 (0)1224 628470 Fax: +44 (0)1224 621444 E-mail: research @seascope.co.uk

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