2001 Maritime

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GULF OFFSHORE 2001 event
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May 7, 2001

Court motions, pay cuts and sea trials at FGH
Friede Goldman Halter last Friday announced it was to file a motion with the bankruptcy court to "reject the two contracts for the construction of the two 'Amethyst' offshore drilling rigs for Petrodrill, a Brazilian company."

"These highly unprofitable contracts," says the statement, "caused substantial losses to the company, and led to the company's recent Chapter 11 filing."

FGH says that "negotiations for the completion of these two undnprofitable contracts with the surety, Fireman's Fund Insurance Company, a wholly owned subsidiary of the German insurance company, Allianz, led to the filing of this rejection motion.."

In a separate release, FGH said that "all senior management members have taken substantial salary cuts, in some cases as high as 40%, in an effort to aggressively assist the company in its reaorganization efforts."

On a more positive note, Ocean Rig ASA today announced that its first rig, Leiv Eiriksson, was to leave the Friede Goldman yard in Pascagoula, Mississippi this morningto commence a period of sea trials. FGH subsequently confirmed the rig's departure.

"The rig will first go close to the Ingalls yard in Pascagoula for inclination testing," noted Ocean Rig. "Then the thrusters will be installed before Leiv Eiriksson goes offshore for the testing of the dynamic positioning systems and various vessel management system tests. It is estimated that the total sea trial period will last approximately 40 days."

Ocean Rig is still negotiating a drilling contract for Leiv Eiriksson for operations offshore Angola.It expects the rig to be on contract when the sea trials are completed..