Northern Offshore Enters MOA for Jack-up Rig Sale (USA)

Northern Offshore, Ltd. yesterday announced that a subsidiary of the company has entered into a Memorandum of Agreement for the sale of the jackup drilling rig Energy Exerter to an undisclosed buyer.

Closing of the transaction, which is subject to certain routine conditions, is expected by October 19, 2012. An escrowed deposit equal to ten percent of the purchase price has been received.

The company expects net proceeds from the sale of approximately US$43.5 million, after related expenses, and anticipates recording a net gain from the transaction of approximately US$7.5 million in the quarter the transaction closes.

Gary W. Casswell, Northern Offshore’s president and CEO, said, “We are excited to announce the MOA for the sale of the Exerter, as we know the uncertainty of the rig’s future has been a predominant spotlight on the company. The company’s directors are currently considering the best use of the proceeds to enhance shareholder value, and we look forward to communicating the results of their discussions as we move nearer to the closing date of the sale.”

The Energy Exerter is one of the harsh environment jack ups in the Northern Offshore fleet. The rig is designed for all year round operation in the Southern North Sea and seasonally in the Central North Sea in water depths of up to 91.5 m (300 ft) with an available leg length below  the hull of 112 m (367 ft).

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Press Release, August 30, 2012