OFFSHORE MARKET REPORT NORWAY Introduction material

Offshore Market Report Norway The Offshore Market Report Norway is a combined top-down and bottom-up review

1. Top-down sources 2. Bottom-up sources

• SSB*: Quarterly investments • Brønnøysund Register: • NPD: capex and opex (RNB**) per field ̵ P&L for about 1200 legal companies***. • Rystad Energy UCube: Forecasting ̵ Estimates when no Norwegian affiliate production, capex and opex based on • Company information bottom-up field by field review ̵ Rystad interview with management for split ̵ Company reports ++ ̵ Business intelligence • Field information ̵ Rystad interview with operators ̵ Conferences and other industry research • Rystad Energy UCube: Forecasting production, capex and opex based on bottom-up field by field review

3. • Define segments Total spending 1985-2020 and company • Match different sources market shares for: • Distribute cost to segments • 11 oil service segments level 1 • Field studies • 50 oil service segments level 2 • International analogous • 150 oil service segments level 3 • Calibration bottom-up vs. top-down

*SSB = Statistics Norway (Statistisk Sentralbyrå) ** RNB = The Revised National Budget (Revidert nasjonalbudsjett) *** We present bottom up figures for groups, e.g Aker Solutions consists of several legal companies, but is here presented as the group Aker Solutions

2 Offshore Market Report Norway Offshore Market in Norway – definition and overview 2013

Opex and non-op in Norway • Fields/licenses • Pipelines and onshore terminals tariffs 69 319 • General costs 302 52 • Costs for license awards • Taxes and fees Opex, genex 250 • Salaries and non-op Not part of offshore market: Opex, genex Suppliers’ Capex in Norway Salaries, CO2 tax, injection gas and non-op and tariffs purchases: • Exploration Sub-contracting • Field development • Brownfield made by suppliers • Pipelines and onshore in Norway* terminals • Offices in Norway Capex Capex Reported as “Investments” or “Capex” in license budgets to NPD/RNB and SSB.

Total cost for oil and Offshore market in Norway Offshore market in gas companies in from Oil companies’ point of Norway, 2013: NOK Norway, 2013: NOK view, i.e. market for direct 319 billion 303 billion suppliers This includes purchases done by suppliers in Norway. We include all purchases within offshore market segments, except office (property, IT, telecom…) and commodities (fuel, power)

Source: SSB; NPD; Rystad Energy research and analysis * We include all purchases within offshore market segments, except office (property, IT, telecom…) and commodities (fuel, power) and purchases/investments done outside Norway (e.g. hull from Korea to rigs).

3 Offshore Market Report Norway 2013 NCS offshore market overview

69 BNOK 319 BNOK 250 BNOK Market for sub-suppliers Offshore Market in Norway Market for direct suppliers Suppliers’ purchases Capex and Opex*** BNOK 1.1 36,5 35.4 REVENUE AND FINACING

Field development* Oil 59.6 BNOK 29.3 88,9 companies

TAXES AND TARIFFS

Salaries and Suppliers’ other internal Capex Opex purchases 155.1

Tariffs, income and BNOK 38.4 193,5 petroleum taxes

* Field development includes new export pipelines ** Field operation includes operations of export pipelines, onshore terminals and office construction *** Opex includes here Non-op (purchases of seismic and G&G in connection with regional and lease round work, outside license cost) Source: Rystad Energy UCube; Rystad Energy DCube; Statistics Norway; Rystad Energy research and analysis

4 Offshore Market Report Norway Oil Service Segment definitions – Level 1 and 2

Why have we chosen this particular segment definition? In defining the segments we have made a balancing act between several aims: - Easy to remember and give overview - Sufficient detail to be specific and allow data gathering - Sufficient generality to allow company benchmarking and global comparison - Industry jargon if possible - Relevant both for suppliers` market research and oil companies’ procurement analysis For inspiration, we have looked at segment definitions from Achilles (800 product oriented segments), SSBs (40 categories), INTSOK (16 segments) and others. However, our segment definition is genuine and made for the purpose of this report.

Segment level 1 and 2 Segment level 2 and 3 Automation and Electro Maintenance Inspection and Maintenance Maintenance Services Metal, pipes and valves Ship and Rig Repair Government and Organizations

ISO Operational Services Operational and Professional Services Professional Services Support Services Detailed Engineering FEED and Studies Engineering Other Engineering and Project Management Services Subsea Engineering Hull/Structure Construction Offshore Construction Services Onshore Infrastructure Construction Procurement, Construction and Installation Topside Construction Artificial Lift Services Drilling Services Wellbore Completion and Re-entry Services Well Service Wireline and Geoscience Services

Casing and Tubing Steel (OCTG)

Drilling Fluids Drilling Tools Drilling Tools and Commodities Specialty Chemicals Jack-ups/barges Platform Drilling Services

Semi/Drillship Well Management Services Rigs and Drilling Contractors Building Components Cables Drilling Rig Equipment Electro, Instruments, Control and Telecom Equipment Topside and Processing Equipment Fire and gas detection and prevention

Maritime Equipment Material Handling Equipment Processing Equipment Rotating Equipment

Subsea Equipment and Installation Subsea Equipment Subsea Services

SURF Trunkline Construction

Transportation and Logistics Base and Logistics Petroleum Aviation Vessels G&G Services G&G Software Seismic and G&G G&G Surveys MultiClient Seismic Sales Seismic Data Processing Seismic Sales

Source: Rystad Energy

5 Offshore Market Report Norway Oil Service Segment definitions – Level 1, 2 and 3

Control Room, Tele and IO Maintenance Hull/Structure Construction re

Electro and Power System Maintenance Hull/S tructu uction Offshore Loading Equipment/Turrets Constr nce Electro on and and on Automati

Maintena Instruments and Measurement Maintenance Decommissioning and Abandonment Services Inspection Heavy Lift MMO frame agreements Hook-up, systems testing Services Offshore Offshore and and

Offshore maintenance Construction Mooring and floater installations

Inspection Inspection Onshore maintenance Onshore Hook-up and System Testing Maintenance Metal and pipe welding and cutting Onshore Infrastructure Construction ion ture Onshore Onshore

Piping Steel Infrastruc Onshore Office Construction Construct Maintenance Services Maintenance Valve Services Living Quarter Module Construction and valves

Metal, pipes Valves Module Construction Brownfield r p d an

Shi Rig Re pai Ship and Rig Repair Module Construction Greenfield

Governmental organizations Topside Module Support Frames and Deck Construction Procurement, Construction and Installation and Construction Procurement, Media and Events Construction Offshore Aluminium and Helidecks ions ent and and ent

Governm Organizat Non-governmental organizations Electrical Submersible Pumps es al Liftal Servic

Access and Scaffolding Artifici Gas Lift Systems Insulation/Passive Fire Protection Directional Drilling Services

ISO Other Fabric Maintenance Services Mud Services Surface Treatment and Painting MWD and LWD systems Field Operation Services Other Drilling Services

Fiscal metering Services Drilling Services Well Production Testing FPSO Rental - Casing, Tubing and Liner running Services Power Supply Services Cement Services Services

Operational Storage vessel Rental Fishing Services TeleCommunication and IO Services Other Well Completion Services

Certification and Integrity Services Well Service Packer Systems and Plugs Financial and Insurance Services Plugging, well wash, gravel packing and other well services

Legal Services entry Services Re-Entry and thru-tubing Services Management Consulting Sand Screens Meteorological Services Wellbore Completion and Re and Completion Wellbore Subsurface Safety systems and Flow Control Product Design and Analysis Cased Hole Wireline Operational and Professional Services R&D Services Coring and other well G&G Services

Professional Services Safety, Health and Environment Services Geoscience Consulting Services

Technical work force/operational support Geoscience Wireline and Open Hole Wireline g g d g el

Catering, Cleaning, Security Services Ca an Tu (O CT G) sin Casing and Tubing Steel (OCTG) bin Ste Computers and Business Software Cement Offshore Accomodation Services Fuel Onshore Accomodation Services Mud Real Estate Services Waste Management and water disposal Support Services Drilling Fluids Detailed Engineering Hull/Deck Blowout Preventers ed ering Detail Detailed Engineering Topside/Modules Downhole Drilling Tools Engine d s FE an

ED FEED and Studies Drill Bits Stu die Engineering workforce and services Drilling Tools Drill Pipe, jars and collars t nt es and and Engineering ering Other Mana geme Servic

Projec Other Engineering and Project Management Services Completion Fluids and Additives Engine Drilling Tools and Commodities lty cals Su bs ea En

gin ing Subsea Engineering Specia Chemi Corrosion, hydrate and paraffin inhibitors eer

Source: Rystad Energy

6 Offshore Market Report Norway Oil Service Segment definitions – Level 1, 2 and 3 - s k

Jac Jack-ups/barges /ba rge ups Containers and speciality equipments m es vic for Platform Drilling Services Dril ling Ser Plat Supply Base Operations Logistics Base and p

Se Semi/Drillship Drilling mi/ Dril lshi Rigs and and Rigs Contractors ll es

vic Well Management Services em ent Ser We Ma nag Petroleum Aviation ion leum Aviat Building Materials and Furniture Petro Anchor Handling Vessels

ts HVAC Systems and equipment

Building Lighting and Heating Crew Vessels Componen

les Cables Cab Other Vessels

Rig Drilling Rig Equipment Dril ling ent Equ ipm

Control Room and Automation Equipment Vessels Shipping Equipment and Marine Technology Transportation Logistics and Transportation Electrical Equipment - other Supply Vessels Electrical Equipment - Transformers, Rectifiers, Converters Electro, Telecom Telecom Instruments Surveying, Positioning and Oceanographic Services Equipment Control and and Control Instruments, Instruments, Telecommunication and IO Equipment Field G&G Services n

on tio Fire and gas detection and prevention gas det pre Fire and ecti and ven Field G&G Studies

riti Maritime Equipment Ma me ent Equ ipm Cranes, Winches, Spoolers and Lifts G&G and Petrophysical interpretation Services g g al ent G&G Services

Materi Other Material Handling Equipment (Trucks, feeders, packing..) Equipm Handlin Reservoir Management Services Chemical Injection Systems Heaters and heat transfer equipment Geology and Seismic Software Topside and Processing Equipment Processing and Topside Separators and Gas treatment Reservoir Modelling and Simulation Processing Processing Equipment Tanks and Columns Well and Pipeline Flow Modelling Compressors G&G Software Generators and Transformers Geotechnical/Site Surveys Motors and Turbines G&G G&G Surveys Rotating Power Generators Gravity and Magnetic Services Equipment Pumps 2D MultiClient Seismic Sales Control Systems Sales Seismic and G&G

Seismic 3D MultiClient Seismic Sales Other Subsea Tools MultiClient

Subsea testing, tool pool and other subsea services g Seismic Data Processing mic Seis Data Proc Templates and Manifolds essin 2D Contract Seismic

Subsea Equipment Subsea Trees and Wellheads Flow assurance Services 3D Contract Seismic s IMR (Subsea Inspec, Maint, Repair (ROV+Diving)) Subsea Subsea Service 4C Contract Seismic Pipeline Systems Risers 4D Contract Seismic Seismic Sales

SURF Subsea Installation Electromagnetic Seismic Services Subsea Equipment and Installation and Equipment Subsea Umbilicals

n Land Seismic

ne Co tio Trunkline Construction Tru nkli nst ruc

Source: Rystad Energy

7 Offshore Market Report Norway Report structure ideal for organizations of different size to tailor make their own report

Chapter 1-2: NCS macro: Unique insight in the historic and future development of exploration activity, cost development, production and investment levels split in (~40 pages) Chapter 3-13: Segment by segment review 2010 market on level 3, forecasts on level 2 to 2020, detailed player overview with 2010 revenue (10-20 pages per segment) Chapter 14: NCS field by field platform review Facts and figures on all installations at the NCS, recently performed large modification and upcoming modification projects (~55 pages)

Chapter overview Tailor make a report ideal for your organization

Chapter 1: NCS offshore market history Chapter 2: NCS offshore market forecast Chapter 3: Maintenance services Basic Section: Chapter 4: Operational and professional services Ideal for smaller Chapter 1: NCS offshore market history Chapter 5: Engineering companies active in Chapter 2: NCS offshore market forecast single segment Chapter 6: Procurement, construction and installation + 1 chapter free of choice Chapter 7: Topside and processing equipment Chapter 8: Well services Chapter 9: Drilling tools and commodities Ideal for larger service Chapter 10: Rig and drilling contractors companies active in Basic Section + additional chapters Chapter 11: Subsea equipment and installation several segment and Chapter 12: Transportation and logistics banks/investor houses Chapter 13: Seismic and G&G Chapter 14: NCS field by field platform review

8 Offshore Market Report Norway Chapter 1: NCS offshore market history

Introduction with observations and comments Detailed overview of historical E&P spending; Yearly and on the NCS historical development quarterly statistics broken down in several multiple ways:

i) Category (opex, capex,..) ii) Asset type (exploration, iii) Oil service segment

Market observations and trends development,…)

Topic Summary and impact Offshore market in Norway 1985-2013, by asset type Offshore market in Norway 1985 – 2013, by main oil service segment Double digit growth last three years, slowdown in growth expected in 2014 - 2010-2011: 19% Driven by fields under dev. (+47% from 43 to 63 bn) and fields in op. (+15% from 117 to 134 bn) Total Offshore Market in Norway, by asset type Offshore Market in Norway History review - 2011-2012: 17% Driven by fields under dev. (+27% from 63 to 80 bn) and fields in op. (+19% from 134 to 159 bn) NOK million nominal NOK million nominal of Offshore - 2012-2013: 14% Driven particular by exploration (+25% from 33 to 41 bn) and fields under dev. (+13% from 83 to 94 bn) 350 000 350 000 Market - 2013-2014[E]: 6% Growth expected to cool down for exploration and fields in operations while fields under development expected to

continue strong growth as field development activity expected to peak (for now) in 2014. 300 000 300 000 2013 market ended up at 319 billion NOK; Investments at 198 bn*, opex at 52 bn and suppliers expenditures at 69 bn.

Maintenance Services All time high investments in fields under development: 250 000 250 000 - Capex (including internal spend) in fields under development has increased from the bottom point of NOK 18 bn in 2004 to 80 bn in 2013. Operational and Professional Services Onshore Terminals Engineering This represent an annual growth of 19%. 200 000 Office construction 200 000 Procurement, Construction and Installation - Due to this, the growth has been particularly strong the following segments: Engineering; Procurement, construction and installation; Pipes in operation Topside and Processing Equipment Topside and processing equipment and Subsea equipment and installation. Pipes under development Rigs and Drilling Contractors 150 000 Fields in operation 150 000 Well Service Exploration levels at all time high – indications of slowdown going forward: Offshore market in Norway 2004 - Q4** 2014, quarterly, by context Share of spend, by context and asset type, 1985-2013 Fields under development Offshore market in Norway 2013, by oil service segments levelDrilling 1 Toolsand and 2 Commodities - Due to higher oil price, good exploration results and two governmental initiatives - APA (awards in predefined areas) and cash back (78% Exploration Subsea Equipment and Installation 100 000 By purchase contex By main asset type 100 000 Offshore Market in Norway, by main segment and split by levelTransportation 2 and Logistics percent percent NOK million of exploration expenses reimbursed following year), exploration investments have increased from 4 bn in 2004 to 37 bn in 2013 – an Seismic and G&G Segment review 100% 100% Level 2 segments Total Offshore Market in Norway Automation and Electro Maintenance annual growth of 27%. 2014 looks to end at or below 2013 levels, setting the scene for lower exploration levels going forward (see ch. 2) Inspection and Maintenance NOK million nominal Maintenance Services 50 000 90% 90% 50 000 Metal, pipes and valves - This growth is mainly reflected in the well related segments Well services, Drilling tools and commodities and Rigs and drilling contractors 100 000 Ship and Rig Repair Government and Organizations in addition to Transportation and logistics. Property of Property ISOof 80% 80% Operational and Professional Services Operational Services 90 000 Genex Professional Services 0 0 Support Services 70% 70% Detailed Engineering Non Op 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009Rystad2011 2013 Energy 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013Rystad EnergyFEED and Studies Fields in operation is the largest segment with respect to investments, also with an all time high investment level in 2013: Engineering Other Engineering and Project Management Services 80 000 Suppliers purchases Subsea Engineering 60% 60% Hull/Structure Construction - Fields in operation has seen a less aggressive growth than the two discussed above, however also a double digit annual growth from Opex Offshore Construction Services Source: Rystad Energy, primarily based on SSB Source: Rystad Energy based Procurement, on SSB andConstruction industry research and Installation Onshore Infrastructure Construction 2004 to 2013 with 13%: from 60 bn in 2004 to 181 bn in 2013. Topside Construction 70 000 Capex 50% 50% Building Components 18 Offshore Market Report Norway 22 Offshore Market Report NorwayCables - This growth is reflected across all segments, but is most linked to brownfield segments such as Maintenance services and Operational Drilling Rig Equipment 40% 40% Topside and Processing Equipment Electro, Instruments, Control and Telecom Equipment 60 000 Fire and gas detection and prevention and professional services. Maritime Equipment Material Handling Equipment 30% 30% Processing Equipment Rigs and Drilling Contractors Rotating Equipment 2013 slightly below exploration trend, but with all time high number of wildcats, 2014 looks to be saved by Alta: 50 000 Jack-ups/barges 20% 20% Platform Drilling Services - 2010: 36 wildcats, 10 appraisals. 827 mmboe discovered resources Semi/Drillship Well Service Well Management Services 40 000 Artificial Lift Services - 2011: 35 wildcats, 17 appraisals. 2882 mmboe discovered resources (Note: Norvarg removed – relinquished) 10% 10% Drilling Services Wellbore Completion and Re-entry Services Wireline and Geoscience Services - 2012: 26 wildcats, 17 appraisals. 1026 mmboe discovered resources Drilling Tools and Commodities Property of 0% 0% Casing and Tubing Steel (OCTG) Exploration 30 000 Drilling Fluids - 2013: 44 wildcats (all time high), 14 appraisals. 738 mmboe discovered resources 1985 1989 1993 1997 2001 2005 2009 2013 1985 1989 1993 1997 2001 2005 2009 2013 Drilling Tools Capex Opex Specialty Chemicals - 2014 level expected to be slightly lower than 2013, with YTD results below recent years success rate: 361 mmboe discovered resources Exploration Fields under development Fields in operation Subsea Equipment and Installation Subsea Equipment 20 000 Suppliers purchases Non Op Pipes under development Pipes in operation Office construction Subsea Services Genex Onshore Terminals SURF before Alta well (Lundin) from discoveries like; Pil (VNG), Drivis (Statoil) and Valemon Nord (Statoil). Alta well announced Oct. 14 with a Trunkline Construction Base and Logistics Rystad Energy Selected observations: Selected observations: Transportation and Logistics Petroleum Aviation range of 125-400 mmboe, possibly reaching above 700 mmboe with several wells still to be drilled. 10 000 Property of • Recent years: • Fields in operations stabilizedProperty at ~55% since 2006 of PropertyVessels of G&G Services - 60% investments • Fields under development down from 56% in 1998 to 16% of total G&G Software - 15-20% operating expenses spend in 2004 – increasing up to 30% in 2010’s Seismic and G&G G&G Surveys - ~20% supplier expenses • Exploration up from 4% in 2003 and 2004 to 14% of total in 2009 MultiClient Seismic Sales 0 Rystad Energy Rystad Energy RystadSeismic Data Processing Energy 1-04 3-04 1-05 3-05 1-06 3-06 1-07 3-07 1-08 3-08 1-09 3-09 1-10 3-10 1-11 3-11 1-12 3-12 1-13 3-13 1-14 3-14 and staying above 10% since Seismic Sales * Note: Deviates from SSB figures at 209 as SSB figures contains internal spend. Source: Rystad Energy; SSB • Onshore terminals peaked above 15% in early 2000’s, steadily 0 10 000 20 000 30 000 40 000 50 000 [E**] * See introduction for description of context; ** Q3 and Q4 estimates for capex from SSB (reported by oil companies) decreased towards 2-5% in 2010’s Source: Rystad Energy based on SSB and NPD; Note: Suppliers purchase estimated, and includes construction of drilling rigs in Norway (11 in 1970s, 1 in 1984, 2 in 2008) Sources: SSB; NPD; Rig rate overview; Rystad Energy Source: SSB (Investment part); NPD (Opex part (RNB)); Brønnøysund (Company data as calibration); Rystad Energy (Research for distribution into sub-segments) 14 Offshore Market Report Norway 16 Offshore Market Report Norway 19 Offshore Market Report Norway 27 Offshore Market Report Norway

Well-by-well overview of exploration results since 2000

Offshore market 2013 (excl. onshore terminals), split by area, operator and facility type

Area-split Operator split Facility split

2013 field cost (capex and opex excl. onshore infrastructure), by top 80 field/licenses

Area Share 2013 Operator Share 2013 Facility Category Share 2013

Tampen Area 23,6 % Statoil 59,8 % Steel platform 27,92013 % field/license opex and capex, by cost type Ekofisk Area 14,2 % ConocoPhillips 10,9 % Subsea tie back 26,7NOK % million nominal Aasgard Area 9,8 % Shell 5,0 % Troll Area 9,1 % BP 4,2 % Concrete GB Gullfaks South14,9 % 12 589 Kristin 2 476 Grane Area 8,4 % Lundin Petroleum 3,8 % FPSO Troll Oil10,5 % 11 531 Valhall IOR 2 469 Sleipner Area 5,9 % Total 2,9 % Ekofisk 11 164 16/2-6 (Johan… 2 407 Semi Troll East (Gas)8,9 % 11 128 Njord 2 355 Oseberg Area 5,6 % ExxonMobil 2,8 % Aasgard 8 774 Gyda 1 832 Norne Area 5,0 % Talisman Energy 2,1 % Fixed and floater Ormen Lange6,8 % 8 205 Urd 1 822 Ormen Lange Area 3,4 % Marathon Oil 2,1 % TLP Goliat3,8 % 7 679 Alvheim 1 768 Ekofisk South 7 666 Boyla 1 577 Draugen Area 2,8 % BG 1,8 % Extended reach Gullfaks0,4 % 7 506 Veslefrikk 1 521 Frigg Area 2,8 % Eni 1,7 % Valemon 6 970 6406/9-3… 1 487 PropertySpar of 0,2 % Hild Area 2,7 % Det norske oljeselskap 1,2 % Statfjord 6 949 16/2-6 (Johan… 1 398 Edvard Grieg 6 501 Other… 1 344 Ula Area 1,6 % GDF SUEZ 1,1 % Snorre 6 083 Brage 1 240 Goliat Area 1,6 % Wintershall 0,3 % Rystad EnergyEldfisk II 5 905 Visund South 1 221 Snohvit Area 1,6 % DONG 0,1 % Oseberg 5 497 Heimdal 1 211 Other 0,2 % Valhall 5 324 Vega 1 181 Other 1,9 % Skuld 5 313 Oseberg East 1 136 Gudrun 4 905 Other… 1 131 Source: Rystad Energy UCube; Rystad Energy research and analysis Balder/Ringhorne 4 760 Jotun 1 128 Draugen 4 679 PL529 1 054 28 Offshore Market Report NorwayMartin Linge 4 332 Svalin 1 049 Oseberg South 4 127 PL457 1 016 Aasgard LP 4 097 Exploration capex Vilje 1 006 Volve 4 027 Fram 994 Knarr 4 020 Development capex 35/9-7 (Skarfjell) 989 Property of Kvitebjorn 3 912 Tordis 985 Heidrun 3 856 Well capex 7225/3-1… 932 Visund 3 753 MMO and expansion capex Gina Krog… 929 Grane 3 715 Visund North 918 Rystad Energy Tyrihans 3 706 Subsea brownfield capex 16/4-6S (Luno… 905 Vigdis 3 475 Total_Norway 830 Norne 3 475 Opex 7120/1-3… 791 Skarv 3 314 Ula 789 Eldfisk 3 182 Abandonement cost PL511 762 Varg 3 156 MorvinProperty757 of Brynhild 3 073 Mikkel 754 Offshore Market Report Norway Gjoa 2 867 Volund 746 Sleipner 2 791 Jette 745 Snohvit Phase 1 2 757 34/10-C-18Rystad A 744 Energy Ivar Aasen 2 482 6407/8-6… 717

Source: Rystad Energy research and analysis based on NPD field level numbers for capex and opex. Exploration capex in licenses not included in NPD statistics; source is Rystad Energy UCube

29 Offshore Market Report Norway

9 Offshore Market Report Norway Example: Offshore market in Norway 1985 – 2013, split by 11 main oil service segments

Offshore Market in Norway NOK million nominal 350 000

300 000

Main Oil Service Segments: Maintenance Services 250 000 Operational and Professional Services Engineering

200 000 Procurement, Construction and Installation Topside and Processing Equipment Rigs and Drilling Contractors 150 000 Well Service Drilling Tools and Commodities Subsea Equipment and Installation 100 000 Transportation and Logistics Seismic and G&G

50 000

0 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

Source: Rystad Energy based on SSB and industry research

10 Offshore Market Report Norway Chapter 2: NCS offshore market forecast

Introduction with observations and changes in Key topics discussed in media: Quarterly insights: the market forecast A section discussing the hot topics in the A section discussing topics related to media with implications for the market recent research by Rystad Energy

Updates and changes

Topic Summary and impact NCS Production The profiles have been updated according to the latest version of Rystad Energy UCube, including all recent discoveries and forecast appraisals. Changes since last report limited to minor fields with limited effect on overall level i) Rigs being put on hold, i) Top 50 oil field service companies 2014 level with insignificant change since last version of this report (Q2). The 2015-level has been taken down with 7% to reflect a - Slowdown in the brownfield market: Very few new modification projects awarded over the last year - Lowered expectations for exploration: SSB estimates for exploration in 2015 is down 9% from 2014 levels, and the rig count is down as discussed above. Market observations and trends (1/2) The forecast has also been adjusted down in both the medium and long term to reflect the negative trends as discussed in the beginning ii) Lay-offs in oil service,… ii) International revenue , … of this chapter: Aggregated levels for 2016-2019 are adjusted down with 11%, and 2020 down with 6%. Topic Summary and impact Insight Important changes in segment forecasts: Q3 2014 - Maintenance Services + Operational and Professional Services:PDOThe activity two segmentsdown in 2013, most possible affected rebound by the day in -2014/15to-day activity level has Key topics discussed in media Q3 2014 (1/3) – Statoil with overcapacity in NCS rig portfolio Over 90 % of 2013-numbers now reported – shows 10 % growth from 2012 to 2013 been adjusted down to reflect the lowered activity as indicated- 2011: by the 12 top PDOs players approved: within MMO Hyme and, Visund ISS. AggregatedNorth, Vigdis levelNortheast, 2015-202 Stjerne0 , Vilje South, Brynhild, Knarr, Visund South, Valemon, Atla, adjusted down by 5% Ekofisk South and Eldfisk II Offshore Market Topic Summary and impact - Engineering + Procurement, Construction and Installation: The- 2012: effect Seven of delayed PDOs and approved: cancelledSkuld projects, Åsgard like subseaHod and compression, Valhall wellhead Jette , Edvard Grieg, Martin Linge, Bøyla and Svalin As of the publication of this report NCS revenues for largest companies with 2013 reporting forecast Billion NOK platforms results in a declining EPCI market from 2016 to 2019,- 2013: with Fiveannual PDOs estimates approved: adjusted Aasta downHansteen with an, Ivar averageAasen, of Gina 11% Krog from, Fram H North and Oseberg Delta 2 Statoil ends Ocean Vanguard contract (In the news: June 2014) over 90 % of the companies covered 2017-2019. PDO activity - 2014/15: 15 possible PDOs – several in danger of being delayed: Headline(s) Statoil suspends Scarabeo 5 contract (In the news: July 2014) in this report have reported their 0 5 10 15 20 25 30 - Ten in the North Sea; Flyndre (approved March 2014), Johan Sverdup (already contract award for two jackets to Kværner) and - Topside and Processing Equipment: 2014 level unchanged, but 2015 estimate is struck hard withMarket the coupling observations of low modification and trends (2/2) COSL Pioneer temporarily suspended (In the news: September 2014) 2013 numbers, and the segment Aker Solutions Bream. Uncertain: Fulla and Krafla (possible area development), Gullfaks Rimfaksdalen, Skarfjell, Tommeliten Alpha, Astero, activity and sunk capex for several of the ongoing field developments. 2015 adjusted down 19% compared to Q2 forecast and 2016- chapters are updated to include 2013 Schlumberger Mackerel and Alfa Sentral Over the last quarter, Statoil has suspended or cancelled a total of three rigs active on the NCS: 2019 levels adjusted down with an average of 10% with a slow uptake in modifications and lack of new greenfield projects. numbers for most companies. Aibel - Four in the Norwegian Sea; Maria andTopic Zidane (postponedSummary from Oct. 2014). and impact Uncertain: Fogelberg and Trestakk - Well Service + Drilling Tools and Commodities + Rigs and Drilling Contractors: Additional rigs taken out of the market Kværner (suspended/cancelled contracts) contribute to a somewhat lower- marketOne in thethan Barents previously Sea; estimated. Johan Castberg (most likely delayed to 2016 or 2017 as concept selection delayed to mid-2015) Ocean Vanguard, originally contracted until February 2015 with Statoil at 454 000 USD/day terminated from August 2014 As stated over the last year, Rystad Energy has seen a slowdown in the modification/brownfield market closing in. Having seen The chart shows revenue for the 30 Vard Group - Subsea Equipment and Installation: The subsea market is reduced considerably in the time frame 2017-2019 with aggregated level The 32 year old rig owned by Diamond Offshore was planned to drill for Statoil in UK in June 2014, before coming back to the NCS for Large pipeline of field development projects: Rystad Energy seeinvestments a total of 11 (capex fixed excludingplatforms wells)(down in3) producing, 3-7 Semi/FPSOs fields growing (up 2, fromnote 29three bn in 2010 to 49 bn in 2013, the market is now experiencing a largest companies with reported Subsea 7 down some 30% from Q2 version as field development activity is expected to be reduced with Statoil putting its breaks on. Overall, the the last period of the contract. Due to confidentiality terms in the contract with Diamond offshore, Statoil has not given any statement to with start-up in 2021) and 12-40 subsea candidatesModification(down 20-cool30) for down first on oil shortfrom to2014 medium-2020. term. Key updates/observations:SSB report estimates on 46 bn (down 6% from 2013) for 2014 and 32 bn for 2015 (down 31% from FMC Technologies market forecasts for Subsea Equipment and SURF show a more volatile development year to year, to account for the cyclical field why it terminated the contract. According to offshore.no, industry sources has claimed the contract was terminated due to i) excessive 2013 figures ( by sum of 2012 and - Valemon looks to meat estimated start-marketup in Q4 2014. No impact2014E). on forecastThe drops are in the same order as stated by SSB in Q2 with a smaller drop in 2014; Down 9% in 2014 and 31% in 2015. The Transocean development market. downtime, and ii) the rig does not have automated fire vents as required by the Petroleum Safety Authority (PSA). However, Diamond 2013). Of the largest companies, only - Goliat delayed. Rystad Energy has estimated start-up of Goliatlatestlate figures 2015, operatorfrom SSB state are reflectedmid 2015. in No the impact updated on forecast,forecast. however with a smaller drop in 2015 as discussed in the insight in the Q2 Offshore has an exemption to operate without automated fire vents on ocean Vanguard. OneSubsea and Bilfinger have not Halliburton release of this report. Company - Ongoing field developments: Spend updated to reflect latest budget estimates (National budget released October 2014). Early indications Summary of yet reported their 2013 numbers. 23 Seadrill Company revenue updated and now shows 2013 revenue fro mostof possible players. delays Expected from 100% projects coverage under constructionin Q4 release. in Asia not yet reflected in forecast. reported figures Field - Following Statoil’s breakthrough in the Barents with the high impact discoveries Skrugard and Havis (later Johan Castberg), the news articles Scarabeo 5, contracted until 2017 with Statoil at 399 000 USD/day temporarily suspended (July 2014) of the companies in the chart report a Baker Hughes 2012 - Johan Sverdrup start-up remains unchangedEarlier with estimated start-up 2020 development Property of exploration results in the surrounding area have been disappointing. Statoil released an exploration agenda for the Johan Castberg Due to overcapacity in the rig portfolio, Statoil suspended the contract for Scarabeo 5 (14 years old) for the remainder of 2014 in July. It National Oilwell Varco 2013 higher Insight Insight 1: Analysis of previous Offshore Market forecasts by Rystad- Yme Energyredevelopment: Yme license partnerdisappoint Lotos has- chosen to write down the value of the Yme field to zero. Possible new development growth in revenue while 7 report a projects area in 2013, including five prospects (Skavl, Drivis, Iskrystall, Nunatak and Kramsnø) . Skavl and Drivis resulted in small oil was drilling at Visund at the time. “We are planning for the rig to be in operation again after the turn of the year. (…)”, said Statoil’s Tore Technip 2013 lower pushed out into the 2020’s (start-up 2020ments in Q2).in theEPCI segments impacted. decline, which support Rystad discoveries while the other three wells found small gas volumes. Statoil’s Pingvin and Isfjell exploration wells nearby failed to provide Aarreberg, rig procurement responsible . GE Energy - Knarr start-up pushed into 2015. LimitedBarents impact Seaon forecast as most capex is sunk. Energy’s view of continued growth Rystad Energyadditional oil resources for a future Johan Castberg development. ABB - Johan Castberg concept selection delayednow until followedmid-2015 by which will delay PDO submission and consequently start-up. Rystad Energy from 2012 to 2013. - October 14, Lundin announced a discovery in the Alta well north east of the Gohta discovery. Early estimates indicate between 125- COSL Pioneer, contracted until 2016 with Statoil at 320 000 USD/day* temporarily suspended (September 2014) Maersk with Castberg start-up to 2021, as in Q2.another No impact Lundin on forecast. th 400 mmboe (88-314 oil). Current combined resource base for Gohta and Alta is up to 632 mmboe according to Lundin, and could Statoil stated in a press release September 17 : “Due to overcapacity in our rig portfolio, Statoil will lay up the COSL Pioneer rig in the Rolls-Royce Marine - Several subsea candidates pushed beyondsuccess 2020. Impact on subsea forecast. fourth quarter of 2014.” “After a careful review of our drilling plan, we find it necessary to suspend COSL Pioneer for the time being,” Especially the large EPC companies Aggregated revenue for companies Source: Rystad Energy support a stand alone field development. In comparison, the Goliat field currently under development holds 174 million barrels of oil. Archer says rig procurement responsible Tore Aarreberg. Aibel and Kværner Stord post large with 2013 reporting - APA2014 has been announced and the predefined area has been expanded by a total of 9 blocks. The area around Aasta Hansteen has IKM Gruppen All time high number of rigs on the NCS in 2013 – continued growth towards 2017 with Statoil challenging the market Billion NOK 47 been expanded by 6 blocks while the area west of Snøhvit has been expanded by 3 blocks. Licenses awards are expected early 2015 growth driven by large EPC projects. Westcon Offshore Market Report Norway - Year end 2013: 38 active rigs during (34 in 2012, 31 in 2011) Key segments 313 (Feb). 47 companies applied, down from 50 in APA 2013. Rig and drilling contractors, Well services and Drilling tools and commodities In the Subsea construction space, 285 +10% New acreage - 2015 [E]: The number of rigs is expected to grow to 42 within 2015 (all currently contracted. Note: 2 units leaving 2015 versus Q2 affected Kleven Maritime - Round 23 postponed with one year as describedNCS Rig marketabove. 160 blocks nominated by 40 companies; 140 in the Barents Sea, 20 in both the Technip and EMAS-AMC both report projections). Property of Fred Olsen Energy Norwegian Sea and North Sea. 86 blocks nominated by two or more companies. double digit growth. - 2017 [E]: The number of rigs is expected to grow to 45+ within 2017 (32 with contract for NCS in 2017, 45 rigs at NCS assuming Statoil reports that the change “(…) will have no impact on Statoil’s production targets or planned exploration activity on the NCS Odfjell Drilling renewals). Norsea Group Rystad Energy Rystad Energy We see a reduced rig demand in 2015 compared to 2014, primarily driven by lower willingness to explore, but also certain field- Aggregated 2013 numbers show a Songa Offshore take away and developments and infill drilling campaigns being pushed to the right. Current outlooks callProperty for activity to pick up again intofo 2016 and revenue growth of about 10%. This Kongsberg Gruppen Property of expected market beyond. However, the massive influx of rigs that the NCS have seen past years, and will see coming years (confirmed Songa and number is not expected to change Apply impact Maersk rigs with possible additions of speculative newbuilds such as North Sea Rigs, Stena, etc.) creates an oversupplied situation that 2012 2013 Source: Rystad Energy significantly, as most companies Oceaneering will last for several years. 2014-levels in the Rig and drilling contractors segment is down by 4% compared to Q2, and 2020 levels are Rystad Energy have now reported their 2013 Cameron Norge Rystad Energy 48 down by 14%. Well services and Drilling tools and commodities are both adjusted down with 1% in 2014, and 13% in 2020. Offshore Market Report Norway revenues. COSL Drilling * Day rate for original contract ending Aug 2014 Property of Source: Rystad Energy, offshore.no, offshoreenergytoday.com, statoil.com Source: Companies’ annual reports as reported to Brønnøysund; Rystad Energy research and analysis Rystad Energy 44 Offshore Market Report Norway 52 Offshore Market Report Norway

Source: Rystad Energy

49 Offshore Market Report Norway

Production profiles 2000-2025 in different breakdowns Market forecasts presented in different breakdowns

i) Life cycles

NCS production forecast by life cycle NCS Offshore Market forecast, by main oil service segment

Production by lifecycle Offshore Market by main segment Thousand boe/d NOK million nominal 5 000 ii) Operators 400 000

4 500 350 000 Oil Service Segment NCS production forecast by operator NCS OffshoreMaintenance Market Services forecast, by life cycle 4 000 Life cycle Operational and Professional Services Undiscovered, Open acreage 300 000 Production by operator Offshore MarketEngineering by life cycle Undiscovered awarded 3 500 Thousand boe/d NOK million nominal Discovery (1970s) Procurement, Construction and Installation 5 000 Discovery (1980s) Topside and Processing Equipment 250 000 400 000 Discovery (1990s) iii) Provinces,…. 3 000 Rigs and Drilling Contractors Discovery (2000s) Operator (top 20) 4 500 Discovery (2010s) Well Service 200 000 2 500 Appraising Lotos (Petrobaltic) 350 000 Drilling Tools and Commodities Field evaluation NCS production forecast by province and area Premier Oil Subsea Equipment and Installation 4 000 Under development Lifecycle as of 2014 Producing early Suncor Energy Transportation and Logistics 2 000 150 000 300 000 Producing 25-50% Production by provinceDONG Production by area Seismic and G&G 3 500 Producing 50%-75% Thousand boe/d Refinery Gains Thousand boe/d Producing >75% 1 500 5 000 RWE 5 000 Producing (Refinery Gains) 100 000 250 000 3 000 Abandoned BG 1 000 4 500 Centrica Energy 4 500 Talisman Energy 50 000 200 000 2 500 Property of Eni 500 4 000 4 000 Total 2 000 0 150 000 Rystad Energy Lundin Petroleum 3 500 3 500 2005 2008 2011 2014 2017 2020 0 GDF SUEZ 2000 2005 2010 2015 2020 2025 Norwegian Sea Oseberg area Note: Currently uncommercial volumes not included 1 500 Wintershall Snøhvit 100 000 Source: Rystad Energy UCube 3 000 3 000 area Source: Rystad Energy research and analysis ExxonMobil Aasgard area 55 2 Offshore Market Report Norway Det norske oljeselskap 1 000 2 500 BP 2 500 50 000 PropertyShell of 500 2 000 ConocoPhillips 2 000 Statoil Troll area 0 Rystad Energy 2005 2008 2011 2014 2017 2020 0 1 500 1 500 2000 2005 2010 2015 2020 2025 Note: Currently uncommercial volumes not included Source: Rystad Energy UCube North Sea Source: Rystad Energy research and analysis 1 000 1 000 57 Offshore Market Report Norway 3

500 500 Property of Grane/Utsira area 0 0 2000 2005 2010 2015 2020 2025 2000 2005 Rystad2010 2015 Energy2020 2025

Note: Currently uncommercial volumes not included Source: Rystad Energy UCube

59 Offshore Market Report Norway

11 Offshore Market Report Norway Example Q3 2014 (released October): Key topics discussed in media Q3 2014 (1/3) – Statoil with overcapacity in NCS rig portfolio

Topic Summary and impact Statoil ends Ocean Vanguard contract (In the news: June 2014) Headline(s) Statoil suspends Scarabeo 5 contract (In the news: July 2014) COSL Pioneer temporarily suspended (In the news: September 2014) Over the last quarter, Statoil has suspended or cancelled a total of three rigs active on the NCS:

Ocean Vanguard, originally contracted until February 2015 with Statoil at 454 000 USD/day terminated from August 2014

The 32 year old rig owned by Diamond Offshore was planned to drill for Statoil in UK in June 2014, before coming back to the NCS for

the last period of the contract. Due to confidentiality terms in the contract with Diamond offshore, Statoil has not given any statement to why it terminated the contract. According to offshore.no, industry sources has claimed the contract was terminated due to i) excessive downtime, and ii) the rig does not have automated fire vents as required by the Petroleum Safety Authority (PSA). However, Diamond Offshore has an exemption to operate without automated fire vents on ocean Vanguard. Summary of news articles Scarabeo 5, contracted until 2017 with Statoil at 399 000 USD/day temporarily suspended (July 2014) Due to overcapacity in the rig portfolio, Statoil suspended the contract for Scarabeo 5 (14 years old) for the remainder of 2014 in July. It was drilling at Visund at the time. “We are planning for the rig to be in operation again after the turn of the year. (…)”, said Statoil’s Tore Aarreberg, rig procurement responsible .

COSL Pioneer, contracted until 2016 with Statoil at 320 000 USD/day* temporarily suspended (September 2014) Statoil stated in a press release September 17th: “Due to overcapacity in our rig portfolio, Statoil will lay up the COSL Pioneer rig in the fourth quarter of 2014.” “After a careful review of our drilling plan, we find it necessary to suspend COSL Pioneer for the time being,” says rig procurement responsible Tore Aarreberg. Key segments Rig and drilling contractors, Well services and Drilling tools and commodities affected

Statoil reports that the change “(…) will have no impact on Statoil’s production targets or planned exploration activity on the NCS

Rystad Energy We see a reduced rig demand in 2015 compared to 2014, primarily driven by lower willingness to explore, but also certain field- take away and developments and infill drilling campaigns being pushed to the right. Current outlooks call for activity to pick up again into 2016 and expected market beyond. However, the massive influx of rigs that the NCS have seen past years, and will see coming years (confirmed Songa and impact Maersk rigs with possible additions of speculative newbuilds such as North Sea Rigs, Stena, etc.) creates an oversupplied situation that will last for several years. 2014-levels in the Rig and drilling contractors segment is down by 4% compared to Q2, and 2020 levels are down by 14%. Well services and Drilling tools and commodities are both adjusted down with 1% in 2014, and 13% in 2020.

* Day rate for original contract ending Aug 2014 Source: Rystad Energy, offshore.no, offshoreenergytoday.com, statoil.com

12 Offshore Market Report Norway Chapter 3-13: Segment by segment overview

Introduction to segment with key drivers and Historic development and Deep dive on most recent recent contract awards and company forecast by level 2 years by level 3 transactions

NCS Maintenance Services – Overview NCS Maintenance Services, historic development NCS Maintenance Services, historic development by segment level 2 and 3

Maintenance Services by segment level 2 Maintenance Services, split by level 2 and 3 NOK million Key market drivers Average age of platforms on the NCS NOK million nominal Total revenue 2013 Years 40 000 30 38 BNOK Age of platforms: Increasing age of platform on the NCS increase the need for maintenance services. 18 000 Instruments and Measurement Maintenance 20 Several of the platforms currently in operations are Electro and Power System Maintenance beyond their original estimated life time, and 35 000 10 Control Room, Tele and IO Maintenance continuous maintenance and upgrades are needed 16 000 Total number of active players Ship and Rig Repair to maintain the integrity. 256 0 Piping Steel 2005 2010 2015 2020 2025 30 000 14 000 Valve Services Selected contract awards since last release Valves Machining and coating Top 3 players (by revenue 2013) 12 000 Contract scope Supplier Buyer Deal value (MNOK) Onshore maintenance Aibel 25 000 Ship and Rig Repair SPS for Borgland Dolphin to be executed Q4 2014 Bergen Gr./Semco M. Dolphin Drilling 350 Offshore maintenance Aker Solutions Inspection MMO FA, Valemon; Q2 2014-July 2016 + 2*2 option Apply Sørco Statoil 180 Metal, pipes and valves 10 000 Westcon MMO frame agreements Valve main. Draugen/Nyhamna, -2019 + 2*2 option Oss-nor Shell 160 20 000 Inspection and Maintenance 8 000 Selected transactions since last release

Distribution of customer types Transaction summary Seller Buyer Deal value (MNOK) Automation and Electro 15 000 Maintenance 6 000 AMOF and Fjell Technology to Merge Fjell Technology AS AMOF AS Oil companies 4 000 41% (direct supplier) 10 000 59% Oil service (sub-supplier) Important changes since last release 2 000 • 2014 estimates have been adjusted down with 2.4%, and Propertyestimates for 2015 down by 10%of due to the 5 000 Property of Property of cutbacks across several segments and layoffs within MMO players due to low expected activity in the - short term. Forecast is adjusted accordingly, however with 2019 and 2020 levels only 1-2% below the forecast in Q2. Rystad Energy Rystad Energy 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Rystad2010 2011 2012 2013 2000 2001 2002 2003 2004 2005 Energy2006 2007 2008 2009 2010 2011 2012 2013 0 Inspection and Maintenance Metal, pipes and valves Ship and Rig Repair Automation and Electro Maintenance 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Source: Industry interviews; Rystad Energy research and analysis; Company information Source: Industry interviews; Rystad Energy research and analysis; Company information

68 Offshore Market Report Norway 69 Offshore Market Report Norway 73 Offshore Market Report Norway

Player overview: Graphical and tabled of 2010 Company deep dives on segment level 3 revenue revenue for all active players in segment for selected chapters Ideal for company screening (acquisition), competitor analysis, analyzing market shares, etc.

NCS Operational and Professional Services Revenue Governmental and Organizations NCS Maintenance Services Revenue 2013 – top 50 players NCS Maintenance Services Revenue 2013 – all players Automation and El. Maint NCS Metal, pipes and valves Revenue 2013 – all players ISO Inspection and Maint. 2013 – top 200 players Operational Services Metal, Pipes and Valves Professional Services NCS Maintenance Services Revenue 2013 split by level 2 Change in revenue from 2012 to 2013* Ship and Rig Repair NCS Metal, pipes and valves Revenue 2013 split by level 3 (Note: Different axes) Support Services NCS Maintenance Services Revenue 2013 split by level 2 (Note: Different axes) NCS Operational and Professional Services Revenue 2013 split by level 2 (Note: Different axes) NOK million Percentage growth 2012 Figures Graphical NOK million 2012 Figures NOK million NOK million 0 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 5 000 -30% -10% 10% 30% 50% 70% 0 100 200 300 400 500 600 700 800 0 10 20 30 40 0 1 2 3 4 0 1 000 2 000 0 50 100 150 0 10 20 30 40 50 60 0 5 10 15 20 Aibel Aibel 0 500 1 000 1 500 0 50 100 150 0 10 20 30 40 50 0 5 10 15 MRC Global Promet Aasen Dreierverksted Aker Solutions Aker Solutions Sverdrup Hanssen Spesialstål Scana Industrier Miras Bilfinger CGI Vrs Installasjon Applus Westcon Westcon Aibel AGR MBO Cosalt Offshore Mento Uvdal Maskinfabrikk Hymek Beerenberg HANSEN PROTECTION NOTECH IBM Fabricom Aker Solutions Langset Unimek Petrolvalves Prosessmetall Jergo DNV GL Bjellcon Hitec Products Dr… VEX-gruppen Fabricom Westcon PSW Group Mekanisk Service … IKM Gruppen IKM Gruppen Teco Maritime Group IKM Gruppen Heinsa Mekaniske Dameco ESS Support Services Cerno Holding Gard Kunnskapsparken Nord Fabricom Helgeland V&M SGS Goodtech Bandak Group Maritim Service Raufoss Offshore Kaefer Energy FORCE Technology … Orange Offshore ADB Bergen Group Bergen Group IKM Gruppen Brattvåg Elektro ABB ABB Halvorsen Proweld Valco Group Vest ventil Ekro Sodexo Remote Sit… Engineering Consu… Verdande Technology KTV group Bergen Group EagleBurgmann Norway Applus view SFF group JB Maskinering Semek Master Marine HERNIS Scan Systems Marin Teknikk ONS offshore Nort… Agility Group Agility Group ABB NTOS Addtech HS-Maskin Proserv Simplicity Cody BOA Group Centerpoint Odda Plast Senergy MRC Global MRC Global Agility Group IK Stavanger Apply Apply Wärtsilä Forus Elektro Aarbakke Group Ulmatec Fjell Industries Prosafe Offshore Software Innovation Møre Teknikk Tel-Tek MRC Global Cameron Norge Promet Norwegian Piping Noske Ventiler Torgy Mek. Industri COSL Drilling Manpower Miras ITC Sverdrup Hanssen Spesialstål Sverdrup Hanssen Spesialstål Apply North Well Gefro Elmo Reinertsen Reinertsen Acel WIS Gruppen Bagges Telenor IFS Christian Michels… Kunnskapsparken H… Sverdrup Hanssen … Rolf Lycke Uvdal Maskinfabrikk Mjøs Metallvarefa… Oss-Nor Aker Solutions Add Energy Group JJS Prosjektpartner Schlumberger Safemar Mento Mento Hermes Marine Service Reinertsen Prosessmetall Euro Offshore Fjelde Mek Verksted IKM Gruppen Tampnett Mudenia Elektro Aalesund Oljekled… Petrolvalves Petrolvalves Mento Voith Os Maskinering Inspecta Freudenberg Oil & Gas Niras Acona Marine Cybernetics Pbs Offshore Simulato… Kongsberg Gruppen Kongsberg Gruppen Petrolvalves Delta Group Jansen og Willums… Jæren Maskinering Wepco Rotork Omega Ressurspartner Intergraph Norge Front Group Oceaneering Oceaneering Kongsberg Gruppen Tratec Ågotnes Sveis TeamUp Automasjon Langset AS Regulator Norsk Offshore Ca… Accpron INTSOK VisSim Linjebygg Linjebygg Oceaneering Flow Control Norway Hymek Fluid Control OSWO Ross Offshore Wikborg, Rein & Co Rignet Oil Infomation GMC Group GMC Group Linjebygg J S Cock TechPart Bandak Group Benor EagleBurgmann Norway Fmv Linjebygg Astrium Services … MIDT NORSK STILLAS Idevekst Energi Bandak Group GMC Group Haakon Ellingsen IK Stavanger Well Innovation Techconsult Lie Overflate Teknikk Valco Group Valco Group Heinsa Mekaniske Ekstrand Teekay Petrojarl … ODS-Petrodata Bandak Group Emerson Process M… Certex Norge Cameron Norge Tubedrill StS gruppen Hytech Personell NUI SFF group Automation and Electro Maintenance SFF group Valco Group NLI Tri tool Norge Metso Furmanite Aluhak Stillas Siemens Maritim Service Falck Nutec Hoover Container … Advokatfirmaet Se… Spesial Produkter Sør Siemens SFF group Kristiansands Skr… North Well Gefro Reins Maskinering Axess Marine Installasjon ExproSoft SAR Vest ventil Metso Grip Maling Korro… Inspection and Maintenance SAR Siemens Slåttland Mek Ind… Rolf Lycke HTS Maskinteknikk OSM Group Xervon BR Industrier Karsten Moholt FLEKKEFJORD ELEKTRO Ultra-Technology Intelecom Karsten Moholt SAR GMV Hermes Marine Service Samson G4S Secure Solutions Seabrokers GIEK Proserv JB Maskinering Promineo Proserv Karsten Moholt Score BEL Valves Norway BR Industrier Tronrud Engineering Norisol Norge Statech Drager Safety Norge Albatross Services Metal, pipes and valves Simplicity Facilium Albatross Services Proserv Malm Orstad Flow Control Norway Sotra Contracting Petrolink Offshore Media Group Apply Aarbakke Group Ulmatec Grenland Mekaniske Ceragon Networks Aarbakke Group Albatross Services Scana Industrier J S Cock Teknisk Produksjon Jotun Well Partner Inventas Produktd… Norwegian Piping Ship and Rig Repair Nemko Real marine Norwegian Piping Aarbakke Group Rightech Consulting Norner Anlegg og Marine Service Sintef On & Offshore Holding Skipsteknisk TDW Offshore Services TDW Offshore Services Rotork Haakon Ellingsen Thune Produkter FIMAMEC Norwegian Piping FORCE Technology … VTT maritime Fosdalen PSW Group Logiteam Invensys PLC 2012 Figures Invensys PLC TDW Offshore Services Petroleum Technol… Simex Slåttland Mek Industri AS Delprodukt Aquateam Vinje Industri Noske Ventiler IRIS SAP Slagen Gruppen Vinje Industri Invensys PLC Otic Hitec Products Dr… Vinje Industri Mekanisk Service Halden NSE Industry Ship Modelling & … Norsk Gjenvinning… RealGroup Nymo Nymo Vinje Industri Kværner Bagges GMV Halvorsen Norwater Fjelde Mek Verksted Berget Langset Servicegrossistene 3M Norge Bilfinger Bilfinger Nymo Intermec Score Ågotnes Sveis TS Group Sharecat Pöyry Epsis Operational and Professional Services revenue 2013, split by segment level 2 (1/7) Operational and Professional Services Niras revenue 2013, split Mandal Maskineringby segment level 2 (1/7) Operational and Professional Services revenue 2013, split by segment level 2 (1/7) Operational and Professional Services revenue 2013, split by segment level 2 (1/7) WIS Gruppen WIS Gruppen Bilfinger Sub Sea Services Malm Orstad Proweld Harris Corp Karmsund Maritime Align Bentley Systems S… Scandcon Oss-Nor Oss-Nor WIS Gruppen Furmanite Levo Petroleum Technology Company HS-Maskin Lloyd's Register Industri Mekanikk ASK Safety Petromedia AS Regulator CAN CAN Oss-Nor Stamas Gruppen Kværner Mjøs Metallvarefabrikk Global Maritime Trelleborg Offsho… Baze Technology C. Christoffersen Semco Maritime Revenue Semco Maritime CAN Revenue Radøygruppen OSWO Watech NLI ValvesRevenue Os Maskinering Revenue Ocean Riser Systems Jæren Maskinering Norges Geoteknisk… Westcon Akzo Nobel Fluid Control NOK million Fluid Control Semco Maritime NOK millionAnlegg og Marine … Fmv Yokogawa Norge Intermec NOK million Safetec Nordic NOK million Bestra Xait Scandinavian Oil-… Multi Industrier Multi Industrier Fluid Control Westcontrol Well Innovation Stamas Gruppen TechPart Nordan Consult Government and Professional Support Share of main Other Oil and Government and Professional Norwegian Support Valve GroupShare of main Other Oil and Tabled Kongsberg Gruppen Valve Services Government Ekstrand and Professional Support Share of main Other Oil and IFE Emerson Process M… Government and Noreq Professional Support Share of main Other Oil and On & Offshore Holding On & Offshore Holding Multi Industrier Maskinering Og Sv… Tubedrill Soludyne Westcontrol Tri tool Norge Vinje Industri Aveva Trac-ID Systems Axess Organizations ISS Operational Services Services Services Axesssegment Gas in Norway Other Revenue Grand Total On & Offshore Holding Mikromekanikk Organizations ISS OneSubsea Operational Services Services AasenServices Dreierverksted segment Gas in Norway Other Revenue Grand Total Organizations ISS Operational Services Services Services segment Gas in Norway Other Revenue Grand Total Norconsult Hillevåg elektro … Organizations ISS Stormgeo Operational Services Services WeldindustryServices segment Gas in Norway Other Revenue Grand Total Sønnico Sønnico Axess Kitron Reins Maskinering Maskinering Og Sveiseservice Ultra-Technology Jotne Group - 2 222 - - - 8,4 % 188 1 489 3 899 - 2 222 - - - Miras8,4 % 188 1 489 3 899 Piping Steel BEL- Valves Norway 2 222 - - - 8,4 % 188 1 489 3 899 FMC Technologies NetApp Corp - Oilfield 2Technolo… 222 - - - 8,4 % 188 1 489 3 899 Storesund Marine Property Storesund Marine of Sønnico Fosstech HTS Maskinteknikk Property of Mikromekanikk Property of Property Haugaland HMS of Norsea Group Herøya Industripark Teknologisk Institutt Eurotechnology - 1 718 - - - 6,5 % 166 43 1 927 - 1 718 - Samson - - Axflow6,5 % 166 43 1 927 Fosstech Grenland- Mekaniske 1 718 - - - 6,5 % 166 43 1 927 - 1 718 - - - 6,5 % 166 43 1 927 Eurotechnology Storesund Marine Pipetech Internat… Berget Solid Vedlikehold Unitech Power Systems Stord Offshore Co… Aker Solutions BR Industrier BR Industrier Eurotechnology Solid Offshore West Elektro K Lerøy Metallindustri Machining and coating iSurvey - - - 1 182 62 4,7 % - 13 990 15 234 - - - 1 182 62 Jergo4,7 % - 13 990 15 234 Stryvo Mandal- Maskinering - - 1 182 62 4,7 % - 13 990 15 234 Proactima Resq - Inmarsat- Solutions - 1 182 62 4,7 % - 13 990 15 234 Euro Offshore Euro Offshore BR Industrier K Lerøy Metallind… Tronrud Engineering AGR NITO Geogroup Advokatfirma DLA … Freudenberg Oil & Gas - - - - 981 3,7 % - 109 1 090 Euro Offshore Quickflange - - Sotra Contracting- - 981 T Bruvik3,7 % - 109 1 090 Parker Hannifin - Lilaas - - - 981 3,7 % - 109 1 090 - - - - 981 3,7 % - 109 1 090 Freudenberg Oil & Gas Rush Maskinering 2012 Figures Levo Data Respons Carboline Norkem Thor Dahl AAK - 949 - - Rystad- AAK3,6 % Energy282 - 1 231 Freudenberg Oil & Gas Stryvo - 949 Teknisk Produksjon- - Rystad- DamecoEnergy3,6 % 282 - 1 231 - 949 - Rystad- - Energy3,6 % 282 - 1 231 Intertek Conventor - 949 Kongshavn - Rystad- Bemanningsbyrået - Energy3,6 % 282 - 1 231 Watech Honeywell Norge AAK Parker Hannifin Thune Produkter Oceaneering - - - - 829 Honeywell Norge3,1 % - 32 861 - - - - 829 Raufoss Offshore3,1 % - 32 861 view Unimek Norwegian- Valve Group - - - 829 3,1 % - 32 861 Stillasgruppen Båtservice Contra… - Simonsen- Advokatf… - - Oljeindustriens K…829 3,1 % - 32 861 Wepco Wepco Honeywell Norge Ktn AS Delprodukt Nosefo Norges Maritime U… Fred. Olsen Produ… - - - - 680 2,6 % - - 680 Wepco Rush Maskinering - - - Align - 680 Semek2,6 % - - 680 - - - - 680 2,6 % - - 680 - - - - 680 2,6 % - - 680 * Only companies where 2013 revenue is available Source: Company information, public sources, Rystad Energy research- - - 664 - 2,5 % 226 868 1 758 Source: Company information, public sources, Rystad Energy research - - - 664 - 2,5 % 226 868 1 758 Source: Company information, public sources, Rystad Energy research - - - 664 - 2,5 % 226 868 1 758 Source: Company information, public sources, Rystad Energy research - - - 664 - 2,5 % 226 868 1 758 - - - - 630 2,4 % - - 630 - - - - 630 2,4 % - - 630 - - - - 630 2,4 % - - 630 - - - - 630 2,4 % - - 630 - - - - 560 2,1 % 2 590 - 3 150 - - - - 560 2,1 % 2 590 - 3 150 - - - - 560 2,1 % 2 590 - 3 150 - - - - 560 2,1 % 2 590 - 3 150 77 Offshore Market Report Norway 79 Offshore Market Report Norway 88 Offshore Market Report Norway 101 Offshore Market Report Norway - - 478 - - 1,8 % - 1 082 1 560 - - 478 - - 1,8 % - 1 082 1 560 - - 478 - - 1,8 % - 1 082 1 560 - - 478 - - 1,8 % - 1 082 1 560 - - - 461 - 1,7 % 143 196 800 - - - 461 - 1,7 % 143 196 800 - - - 461 - 1,7 % 143 196 800 - - - 461 - 1,7 % 143 196 800 - 46 29 368 - 1,7 % 2 442 682 3 567 - 46 29 368 - 1,7 % 2 442 682 3 567 - 46 29 368 - 1,7 % 2 442 682 3 567 - 46 29 368 - 1,7 % 2 442 682 3 567 - - - 402 28 1,6 % 443 290 1 163 - - - 402 28 1,6 % 443 290 1 163 - - - 402 28 1,6 % 443 290 1 163 - - - 402 28 1,6 % 443 290 1 163 - - - 390 - 1,5 % 1 169 - 1 559 - - - 390 - 1,5 % 1 169 - 1 559 - - - 390 - 1,5 % 1 169 - 1 559 - - - 390 - 1,5 % 1 169 - 1 559 - - - - 382 1,4 % - - 382 - - - - 382 1,4 % - - 382 - - - - 382 1,4 % - - 382 - - - - 382 1,4 % - - 382 - - - 360 - 1,4 % 242 - 601 - - - 360 - 1,4 % 242 - 601 - - - 360 - 1,4 % 242 - 601 - - - 360 - 1,4 % 242 - 601 - 339 - - - 1,3 % 365 18 723 - 339 - - - 1,3 % 365 18 723 - 339 - - - 1,3 % 365 18 723 - 339 - - - 1,3 % 365 18 723 - - 331 - - 1,2 % - - 331 - - 331 - - 1,2 % - - 331 - - 331 - - 1,2 % - - 331 - - 331 - - 1,2 % - - 331 - 300 - - - 1,1 % - 17 317 - 300 - - - 1,1 % - 17 317 - 300 - - - 1,1 % - 17 317 - 300 - - - 1,1 % - 17 317 - - - 292 - 1,1 % - - 292 - - - 292 - 1,1 % - - 292 - - - 292 - 1,1 % - - 292 - - - 292 - 1,1 % - - 292 - - - 282 - 1,1 % 13 146 441 - - - 282 - 1,1 % 13 146 441 - - - 282 - 1,1 % 13 146 441 - - - 282 - 1,1 % 13 146 441 - - - 277 - 1,0 % - 206 483 - - - 277 - 1,0 % - 206 483 - - - 277 - 1,0 % - 206 483 - - - 277 - 1,0 % - 206 483 - - - - 266 1,0 % - 621 886 - - - - 266 1,0 % - 621 886 - - - - 266 1,0 % - 621 886 - - - - 266 1,0 % - 621 886 - 256 - - - 1,0 % - 85 341 - 256 - - - 1,0 % - 85 341 - 256 - - - 1,0 % - 85 341 - 256 - - - 1,0 % - 85 341 - - - 254 - 1,0 % 117 6 377 - - - 254 - 1,0 % 117 6 377 - - - 254 - 1,0 % 117 6 377 - - - 254 - 1,0 % 117 6 377 - 246 - - - 0,9 % - 12 075 12 321 - 246 - - - 0,9 % - 12 075 12 321 - 246 - - - 0,9 % - 12 075 12 321 - 246 - - - 0,9 % - 12 075 12 321 - - - 233 - 0,9 % 189 537 959 - - - 233 - 0,9 % 189 537 959 - - - 233 - 0,9 % 189 537 959 - - - 233 - 0,9 % 189 537 959 - - - 214 - 0,8 % 28 90 331 - - - 214 - 0,8 % 28 90 331 - - - 214 - 0,8 % 28 90 331 - - - 214 - 0,8 % 28 90 331 - - - 210 - 0,8 % - 103 313 - - - 210 - 0,8 % - 103 313 - - - 210 - 0,8 % - 103 313 - - - 210 - 0,8 % - 103 313 - 209 - - - 0,8 % - 52 261 - 209 - - - 0,8 % - 52 261 - 209 - - - 0,8 % - 52 261 - 209 - - - 0,8 % - 52 261 - - - 202 - 0,8 % 122 157 481 - - - 202 - 0,8 % 122 157 481 - - - 202 - 0,8 % 122 157 481 - - - 202 - 0,8 % 122 157 481

Note: 2012 figures where 2013 figures not available Note: 2012 figures where 2013 figures not available Note: 2012 figures where 2013 figures not available Note: 2012 figures where 2013 figures not available Source: Company information, public sources, Rystad Energy research Source: Company information, public sources, Rystad Energy research Source: Company information, public sources, Rystad Energy research Source: Company information, public sources, Rystad Energy research

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13 Offshore Market Report Norway Chapter 14 – platform by platform overview – Example: Southern North Sea, Valhall

Valhall Field Information

Operator BP Recent modification projects Upcoming modification projects Support org. Stavanger All Platforms All Platforms MMO FA Aker Solutions • New subsea pipeline systems 2008 • Gas lift modules at Valhall Flanke Nord and Valhall ISO FA Bilfinger Industrier • Late life redevelopment - new production and Flanke Sør. New modules at Valhall WP (2009-2011) Other FA Safety and autmation systems: ABB accom. platform 2010-ongoing, Aker Solutions (NOK including Riser/ESDV facility. 450 mill) • Longer term, need wave protection/prolonge legs due Drilling op. Archer • Water Handling, PorPure and NLI, 2010 to subsidence Wells since 2005 42 • HVAC, Apply Oil & Gas, 2011 • Modifications related to decommissioning and shut- 2008 2009 2010 2011 2012 • Life of Field Seismic system – LoFS, Technip (NOK down of old platforms 50 mill) • Candidate for drilling facility upgrade Total OPEX 1015 1063 961 1505 2036 • Office modules, HB Rentals, 2010/11 (NOK 5 mill) • Candidate for gas treatment upgrade Total CAPEX 6445 7781 7063 4866 6170 • Gas lift modules at Valhall Flanke Nord and Valhall • Pumps, Eureka Pumps (Align), frame agreement with Flanke Sør. New modules at Valhall WP (2009-2011) BP for three years including Riser/ESDV facility. Platform Facts • Electrification from shore from 2011 Upcoming redevelopment projects Valhall PH (started production Jan 2013) Steel platform; Process and hotel (180); Installed 2012; Start-up: Jan All Platforms 2013; Capacity: 120 kbbl/d; Topside weight: 11,85 kt; Base: Kværner; Deck: Heerema; Installation: Saipem; W. depth: 69m • PCP, QP and DP platforms decommissioned by 2020 Valhall PCP Recent redevelopment projects • "The Greater Valhall Programme" - possibly two new Steel platform; Process; Installed Dec 1981; Start-up: Oct 1982; Capacity: 168 kbbl/d; Topside weight: 13 kt; Base: McDermott; Deck: • Valhall PH (production and hotel) platform started platforms, drilling of 20 to 30 wells, 43 BNOK Aker Stord/Kvaerner Brug/Vigor; Installation: Heerema; W. depth: 69 m production January 2013. Part of Valhall investments, includes investments at Ula Valhall WP Wellhead Platform; Process; Installed May 1996; Start-up: May 1996; redevelopment program with total development cost – New Wellhead Platform at Valhall: cancelled 2014 Capacity: 40 kbbl/d; Topside weight: 2 kt; Base: Heerema; Deck: – New process and living quarter platform at Valhall Heerema; Installation: Heerema; W. depth: 69 m of BNOK 49,6 (+98,2% compared to original PDO Valhall IP estimate) (Valhall PH) Steel platform; Drilling; Installed Aug 2003; Start-up: Jan 2004; Topside – New platform at Hod: Cancelled 2014 weight: 10 kt; Base: Aker Verdal; Deck: Aker Stord; Installation: Saipem; W. depth: 69 m – Upgrades at Ula Valhall DP • Maersk Reacher drilling contract renewed for drilling Steel platform; Drilling; Installed Jan 1981; Start-up: Oct 1982; Topside weight: 7 kt; Base: Aker Verdal; Deck: Aker Verdal; Installation: untill Q3 2016. In addition, new Jack-up ordered by McDermott/Heerema; W. depth: 69 m Maersk for Valhall from Daewoo Shipbuilding and Valhall QP Steel platform; Hotel(209); Installed Apr 1980; Start-up: Oct 1982; Marine Engineering. Delivery 2016, value 3,8 BNOK. Topside weight: 3 kt; Base: Aker Stord; Deck: UIE/Sterkoder/Vigor; Installation: McDermott; W. depth: 69 m Valhall Flanke Nord Wellhead Platform; Installed Jul 2003; Start-up: Jan 2004; Topside weight: 2 kt; Base: Heerema; Deck: Heerema; Installation: Heerema; W. depth: 69 m Valhall Flanke Sør Wellhead Platform; Installed May 2003; Start-up: Fall 2003; Topside weight: 2 kt; Base: Heerema; Deck: Heerema; Installation: Heerema; W. depth: 69 m

Source: NPD; Company information; Rystad Energy research and analysis; Industry sources

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14 Offshore Market Report Norway Offshore Market Report Norway