Prosafe SE. Listing Prospectus. Registration Document

Transcription

1 Prosafe SE Listing Prospectus Oslo, 04. November 2014 Joint Lead Managers: Prepared according to Commission Regulation (EC) No 809/2004 Annex IX

2 Prosafe SE, of 04. November 2014 Important information This (the ) is based on sources such as annual reports and publicly available information and forward looking information based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for the Company's (including subsidiaries and affiliates) lines of business. This is subject to the general business terms of the Joint Lead Managers, available at their websites. Confidentiality rules and internal rules restricting the exchange of information between different parts of the Joint Lead Managers may prevent employees of the Joint Lead Managers who are preparing this presentation from utilizing or being aware of information available to the Joint Lead Managers and/or affiliated companies and which may be relevant to the recipients' decisions. The Joint Lead Managers and/or affiliated companies and/or officers, directors and employees may be a market maker or hold a position in any instrument or related instrument discussed in this, and may perform or seek to perform financial advisory or banking services related to such instruments. The Joint Lead Managers' corporate finance department may act as manager or co-manager for this Company in private and/or public placement and/or resale not publicly available or commonly known. Copies of this presentation are not being mailed or otherwise distributed or sent in or into or made available in the United States. Persons receiving this document (including custodians, nominees and trustees) must not distribute or send such documents or any related documents in or into the United States. Other than in compliance with applicable United States securities laws, no solicitations are being made or will be made, directly or indirectly, in the United States. Securities will not be registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The distribution of the may be limited by law also in other jurisdictions, for example in Canada, Japan and in the United Kingdom. Verification and approval of the Registration Document by Finanstilsynet (the Norwegian FSA) implies that the may be used in any EEA country. No other measures have been taken to obtain authorisation to distribute the in any jurisdiction where such action is required. Finanstilsynet has controlled and approved the pursuant to the Norwegian Securities Trading Act 7-7. Finanstilsynet has not controlled and approved the accuracy or completeness of the information given in the. Financial supervision and approval relating solely to the Company has included descriptions according to a pre-defined list of content requirements. Finanstilsynet has not undertaken any form of control or approval of corporate matters described in or otherwise covered by the. Please refer to section 2 Definitions for definitions of terms used throughout this, which also apply to preceding pages. The dated 04. November 2014 together with the securities note (the Securities Note ) dated 04. November 2014 constitutes the Prospectus. Prepared in cooperation with the Joint Lead Managers 2 of 42

3 Prosafe SE, of 04. November 2014 TABLE OF CONTENTS 1. Risk factors General Strategic risk Operational risk Compliance/legal risk Financial risk Definitions Persons responsible Persons responsible for the information Declaration by persons responsible Cautionary Note Regarding Forward-Looking Statements Statutory Auditors Names and addresses Information about the Issuer History and development of the Issuer Business overview Introduction and history Principal activities The Fleet New builds Fleet contract status Risk management Organizational Structure Description of Group Issuer dependent upon other entities Market outlook Statement of no material adverse change Administrative, management and supervisory bodies Information about persons Administrative, management and supervisory bodies conflicts of interest Major shareholders Ownership Change in control of the Issuer Financial information concerning the Issuer's assets and liabilities, financial position and profits and losses Historical Financial Information Financial statements Auditing of historical annual financial information Age of latest financial information Debt and financial covenants Legal and arbitration proceedings Significant change in the Group's financial or trading position Documents on display Cross Reference List Disclaimers Managers disclaimer Prepared in cooperation with the Joint Lead Managers 3 of 42

4 Prosafe SE, of 04. November Risk factors 1.1 General The risk factors for the Issuer and the Group are deemed to be equivalent for the purposes of this Registration Document. The Issuer and the Group operate on several continents and in various parts of the value chain. The Group s activities and business development are subject to several categories of risk. The Issuer currently assesses the Group s overall risk in four main categories: strategic, operational, compliance/legal and financial. 1.2 Strategic risk Unlike risk related to operations, compliance/legal and finance, where the Issuer seeks to reduce exposure as far as reasonably and practically possible, strategic risk is the only category that the Group actively accepts in order to generate a return for its shareholders. The Issuer will create shareholder value by allocating capital and resources to the commercial opportunities that yield the best return in relation to the risks involved within its specified strategic direction. Macro risk Demand and supply in the market in which the Issuer operates is subject to cyclical movements in both the global economy and in regional economies. These movements may be driven by a number of factors such as political processes, changing trading patterns, changes in productivity, technological shifts, and monetary imbalances. Competition risk Any significant increases in the fleet of available accommodation vessels may affect utilization rates and/or day rates negatively, potentially adversely impacting the Issuer s financial results and cash flows. Demand risk Demand for the Issuer s services may be affected negatively by oil companies earnings. Changes in the oil price affect oil companies cash flows adversely impacting their willingness to invest in exploration and production. If the oil price drops significantly, oil companies may reduce spending, which in turn may lead to lower demand for accommodation vessels. Furthermore, in the long-term demand will depend on the oil companies replacement ratio. If oil companies fail to replace reserves, ultimately leading to lower production volumes, demand for accommodation vessels may also be reduced. The Issuer s customer base is fairly well diversified, although certain customers may, to a varying degree over time, make up substantial parts of the contract backlog. In line with industry practice, a contract normally contains early cancellation provisions for the customer in specific circumstances. Subject to termination not being due to a breach or negligence on the part of the Issuer, the effect on results in such cases will normally be wholly or partly offset by a financial settlement in the Group s favour. Due to the financial instability which existed in the region in the 1980s, current contracts relating to operations in Mexico contain a cancellation clause allowing termination on 30 days notice without compensation, if the Mexican government decides to cancel funding of the project for which any vessel has been contracted. 1.3 Operational risk The Issuer s offshore operations involve a number of risks. Operational uptime risks In most of the Group s contracts the day rate received will be subject to gangway uptime. Consequently, any operating failure leading to down time on the gangway connection may affect the Issuer s results negatively. Such downtime may be caused by human errors, breakdown of equipment or an otherwise difficult operating environment. Key personnel and crew risk The Issuer is operating in a complex industry. Although measures are taken to reduce dependency on any individual employee, the Issuer may in certain situations be dependent on the competency and experience of key personnel. Consequently, any such person leaving the Issuer may affect processes and operations negatively. Having a competent and experienced crew on the vessels is vital for achieving high operational standards. Given the growth in the oil and gas business the competition for competent personnel is high, which may result in difficulties in recruitment and potentially higher cost of employment. Prepared in cooperation with the Joint Lead Managers 4 of 42

5 Prosafe SE, of 04. November 2014 Project execution risk The Issuer will from time to time undertake larger projects related to new builds or upgrades of existing vessels. Such projects carry considerable risks related to cost overruns and delayed completion that may have a material adverse impact on the Issuer s financial position. Health Safety and Environment risk The work processes onboard the Group s vessels can be complex and may have to be undertaken in a potentially difficult environment. Consequently, there is a risk that personnel may be injured and/or equipment damaged. Furthermore, the business entails risk of accidental discharges/emissions to the natural environment. Hazard risk Given the nature of the Issuer s business, any operating failure or loss of asset integrity may cause serious accidents that could lead to critical damage and, ultimately, a total loss of the asset. This could have a severe impact on the Issuer s financial position. 1.4 Compliance/legal risk Legal risk The Issuer may become involved in contractual and other disputes and legal proceedings where the outcome is uncertain. Such proceedings may be expensive and time consuming and, depending on the outcome, may have a negative impact on the financial position of the Issuer. Insurance risk The Issuer s insurance strategy has been adopted with the aim of reducing the financial risks of any incidents and casualties. The Issuer s insurances cover its assets, hired and operated fleet, liabilities, pollution and environmental risks cargo and non-marine risks. Insurance is taken out with reputable international insurance companies and in accordance with good market practice. There is, however, always a risk that insurance will not provide full coverage of losses related to the abovementioned items, which in turn may adversely affect the Issuer s financial position. Regulatory risk The Issuer is involved in an industry that is highly regulated by different international and national Government bodies. Non-compliance with relevant regulations may lead to suspended operations, which in turn may cause financial losses. Furthermore, changes to regulations may affect the Issuer s vessels. This could adversely impact the commercial and strategic position of the Issuer and may necessitate substantial investments. 1.5 Financial risk Interest rate risk The Issuer s fleet is partly financed by interest-bearing debt. Although the Issuer seeks to mitigate such risk by different hedging arrangements, increases in interest rates may have a material adverse impact on the Issuer s earnings and cash flows. Currency risk The Issuer is exposed to several currencies. The bulk of revenues are in United States Dollars (USD) and vessels owned by the Issuer are valued and financed in USD. Accounts are therefore compiled in USD. During certain periods, however, depending on the country of operation, the Issuer will have contracts that yield GBP, NOK and BRL revenues, with a consequent reduction in net currency exposure. Operating expenses are mainly denominated in USD, GBP, NOK, SGD and BRL, but depending on the country of operation and nationality of the crew, operating expenses can also be in other currencies, such as EUR and SEK. Fluctuations in the mentioned currencies versus the USD may have significant impact on the financial statements of the Group. Credit risk As the Issuer is partly financed by interest-bearing debt it is subject to credit risk. All its loans have a defined maturity date and there will always by a risk that debt cannot be fully refinanced. This could relate to Issuer Prepared in cooperation with the Joint Lead Managers 5 of 42

6 Prosafe SE, of 04. November 2014 specific factors, such as excessive leverage, falling asset values or low earnings/cash flow or it could have to do with macro economic factors and the general development in the global credit markets. Failure to refinance debt may have a material adverse impact on the Issuer s financial position. The Issuer s loan agreements contain various covenants. Breach of one or more of the covenants may lead to higher cost of debt or, ultimately, mandatory pre-payment of loans. Counter-party risk The Issuer s clients are mostly reputable national oil companies, super majors, majors and larger independent oil companies. However, if a client should default on any obligation it could have a material negative impact on the Issuer s earnings and cash flows. Technical risk Technical risk involves future demand for certain technical specifications and a yard s ability to deliver in line with the specifications required. These future demands may have significant impact on the financial statements of the Group. Construction risk Construction risk is the possibility of cost overruns and delays in connection with new build projects. Cost overruns and delays may have significant impact on the financial statements of the Group. Prepared in cooperation with the Joint Lead Managers 6 of 42

7 Prosafe SE, of 04. November Definitions Company/Parent company/ Issuer/Prosafe Prosafe SE Company Annual Report 2012 Prosafe SE annual report of 2012 Company Annual Report 2013 Prosafe SE annual report of 2013 Bareboat Bond Issue Bonds BRL AoC Commissioning DEA Decommissioning DMA DNV DP/DP2/DP3 E&D E&P EBITDA EEA EU EUR FPSO FSA FSO Group/Prosafe GBP Hook-Up IFRS IOR Jack-up Charter contract in which administrative, operational and technical assistance is not provided by the vessel owner The bond issue constituted by the Bonds The securities issued by the Company pursuant to the bond agreement Brasilian Real Acknowledgement of Compliance Process of testing installed facilities, equipment and systems Danish Energy Agency Process of removing offshore installations Danish Maritime Authority Det Norske Veritas Dynamic positioning, DP2 and DP3 involves increasing system redundancy Exploration and Development Exploration and Production Earnings Before Interest, Tax, Depreciations and Amortisations European Economic Area European Union Euro Floating production, storage and offloading vessel Finanstilsynet Floating, Storage and offloading vessel Prosafe SE and its subsidiaries Pound Sterling Installation of modules or vessels to an oil field International Financial Reporting Standards as adopted by the European Union Improved oil recovery Mobile, self-elevating platform with moveable legs Prepared in cooperation with the Joint Lead Managers 7 of 42

8 Prosafe SE, of 04. November 2014 Leverage Ratio LIBOR Mooring System NOK The sum of the Group s total debt divided by the Group s EBITDA (on a trailing four-quarter basis) London Interbank Offered Rate Station keeping by a mooring line, anchor and connectors Norwegian kroner 1Q Report 2014 The Group s interim financial statement for the first quarter of Q Report 2014 The Group s interim financial statement for the second quarter of 2014 OPEX Prospectus PSA Operating Expenditure The together with a Securities Note and if applicable Summary constitutes the Prospectus Petroleum Safety Authority Norway This dated 04. November 2014 SEK Semi-submersible vessel/semi SGD Spar TAMS Tender Suppurt Vessel Thruster Time Charter TLPs UK UKCS USD VPS or VPS System Swedish Kronor Floating platform mounted on submerged legs supported by pontoons below water line Singapore Dollars Floating platform, consisting of a vertical cylinder bearing topsides Thruster Assisted Mooring System Vessel providing power and other services to drilling operation Computer-controlled propellers Charter contract in which administrative, operational and technical assistance is provided by the vessel owner Tension Leg Platform United Kingdom UK Continental shelf United States Dollars The Norwegian Central Securities Depository, Verdipapirsentralen Prepared in cooperation with the Joint Lead Managers 8 of 42

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10 Prosafe SE, of 04. November Cautionary Note Regarding Forward-Looking Statements This Prospectus and the documents incorporated by reference herein contain forward-looking statements. All statements other than statements of historical facts are statements that could be deemed forward-looking statements, including statements preceded by, followed by or that include the words estimate, plan, project, forecast, intend, expect, anticipate, believe, think, view, seek, target, goal, or similar expressions; any projections of earnings, revenues, expenses, synergies, margins or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new products, services, developments or industry rankings; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Such forward-looking statements, whether expressed or implied, are subject to risks and uncertainties which could cause the actual results of the Issuer to differ materially from those implied by such forward-looking statements, due to a number of factors, many of which are beyond the Company s control. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, results of the Issuer could differ materially from the expectations in these statements. The Issuer does not undertake any obligation to update these forward-looking statements, except as required by law. No forward-looking statements contained in this Prospectus should be relied upon as predictions of future events. No assurance can be given that the expectations expressed in these forward-looking statements will prove to be correct. Actual results could differ materially from expectations expressed in the forward-looking statements if one or more of the underlying assumptions or expectations proves to be inaccurate or is unrealized. Some important factors that could cause actual results to differ materially from those in the forward-looking statements are included in Section 1 Risk Factors. Readers are cautioned not to place undue reliance on the forward-looking statements contained in this Prospectus, which represent the best judgment of the Company s management as of the date of this Prospectus. Except as required by applicable law, the Company s does not undertake responsibility to update these forwardlooking statements, whether as a result of new information, future events or otherwise. Readers are advised, however, to consult any further public disclosures made by the Company, such as filings made with the Oslo Stock Exchange or press releases. Prepared in cooperation with the Joint Lead Managers 10 of 42

11 Prosafe SE, of 04. November Statutory Auditors 5.1 Names and addresses The Company's auditor is Ernst & Young Cyprus Limited, with registered address: Name Address Ernst & Young Cyprus Limited Nicosia Tower Centre, 36 Byron Avenue, P. O. Box 21656, 1511 Nicosia, Cyprus The Company s auditor for 2012 and 2013 has been Ernst & Young Cyprus Limited. Ernst & Young Cyprus Limited is member of the Institute of Certified Public Accountants of Cyprus. Prepared in cooperation with the Joint Lead Managers 11 of 42

12 Prosafe SE, of 04. November Information about the Issuer 6.1 History and development of the Issuer Legal and commercial name The legal name of the Bond Issuer is Prosafe SE with the commercial name Prosafe SE Place of registration and registration number The Issuer is a European public limited liability company registered with the Registrar of Companies and Official Receiver of the Republic of Cyprus, with the registration number SE Date of incorporation The Issuer was incorporated on 26 March In 2007, the Issuer moved its head office to Cyprus Domicile and legal form The Issuer is a European public limited liability company organized under the laws of Cyprus and Cyprus Companies Law, Cap 113. Certain aspects of the Issuers activities are governed by Norwegian law pursuant to the listing agreement between Oslo Børs (the Oslo Stock Exchange) and the Issuer. In particular, the Norwegian Securities Trading Act and the Norwegian Stock Exchange Regulations will apply. For a full description of the Issuer and the Group please also see section 7 Organizational Structure. The registered office and visiting address is Stadiou 126, 6020 Larnaca, Cyprus The Issuer s telephone number is and telefax number: Prosafe Management AS and Prosafe AS address is Forusparken 2, P.O Box 39 Forus, 4064 Stavanger, Norway. Phone: The Issuer s website address is Prepared in cooperation with the Joint Lead Managers 12 of 42

13 Prosafe SE, of 04. November Business overview 7.1 Introduction and history The Issuer s vision is to be a leading and innovative provider of technology and services in selected niches of the global oil and gas industry. The Issuer was formed in 1997, when the platform drilling and technical services divisions de-merged from Transocean as a separate company and became listed on the Oslo Stock Exchange as Procon Offshore ASA. This company merged with Safe Offshore ASA, thereby entering the business segment of accommodation/service vessels, and changed its name to Prosafe ASA. The Issuer acquired floating production company Nortrans Offshore in 2001, extending its activities to include the conversion, chartering and operation of FPSOs and FSOs. In 2005, the Issuer refined its commercial portfolio with the sale of the drilling services division. In 2006, the company acquired Consafe Offshore AB, which owned three semi-submersible accommodation/service vessels and one accommodation jack-up. This acquisition cemented the Issuer s position in the market for semi-submersible accommodation/service vessels. In May 2008, the Floating Production division was spun off by establishing a subsidiary, Prosafe Production Public Limited, and by distributing 90.1 per cent of the shares to the shareholders of the Issuer. Prosafe Production Public Limited was listed on the Oslo Stock Exchange on 2 June Prosafe SE sold its 9.9 per cent stake in Prosafe Production Public Limited in In 2011 and 2012, Prosafe ordered two Norway compliant, semi-submersible accommodation vessels, Safe Boreas and Safe Zephyrus, from Jurong Shipyard Pte Ltd in Singapore. When delivered, Prosafe believes that the vessels will be the most sophisticated and well-equipped accommodation vessels in the market, in terms of technical specifications and operational efficiency. Both vessels will be ready for operations in In 2013, Prosafe ordered two semi-submersible accommodation vessels, Safe Notos and Safe Eurus, from COSCO (Qidong) Offshore Co. Ltd. in China. Based on the technical specifications and operational efficiency, Prosafe believes that the vessels will be the most advanced and flexible units for worldwide operations excluding Norway. The vessels will be ready for operations in In 2014, Prosafe entered into a contract with Statoil Petroleum AS ( Statoil ) for the provision of the Safe Scandinavia, to be temporarily converted for tender support vessel ( TSV ) operations. Conversion is scheduled to take place in the 1 st half of Principal activities Prosafe owns 11 semi-submersible accommodation vessels in operation and four semi-submersible accommodation vessels under construction. Accommodation/service vessels are used when there is a need for additional accommodation, engineering, construction or storage capacity offshore. Typically, these vessels will be utilised in connection with installation and commissioning of new facilities, upgrades, modifications and maintenance of existing installations, hook-ups of satellite fields to existing infrastructure, and decommissioning and removal of installations. Prosafe s vessels have accommodation capacity (i.e.max number of beds) for people depending on the type of vessel and offer high quality welfare and catering facilities, storage, workshops, offices, medical services, deck cranes and lifesaving and fire fighting equipment. The vessels are positioned alongside the host installation and are connected by means of a telescopic gangway so that personnel can walk to work. The Group has extensive experience from operating gangway connected to fixed installations, FPSOs, TLPs, Semis and Spars. The Group s track record comprises operations offshore Norway, UK, Denmark, Brazil, Tunisia, West Africa, North-west and South Australia, the Philippines, Russia, USA and the Gulf of Mexico. Prosafe s activities fall within the latter part of an oil field s life cycle. The majority of Prosafe s operations are related to maintenance and modification of installations on fields already in production, while some activity is also related to commissioning and decommissioning. This strategic position in the value chain ensures sustainable growth for the company and a high return on equity in relation to risk. Prepared in cooperation with the Joint Lead Managers 13 of 42

14 Prosafe SE, of 04. November The Fleet Prosafe has a strong track record in carrying out demanding operations world wide, with first class operational performance and good safety results. With six dynamically positioned and five anchored vessels, Prosafe s fleet is versatile and able to operate in nearly all offshore environments. Regalia Regalia is a semi-submersible vessel able to work in all geographical areas, including harsh environments such as the UK and Norwegian Continental Shelves. Regalia underwent a major refurbishment in 2008/2009, which extended the life of the unit substantially with respect to operating in the Norwegian Continental Shelf. During the refurbishment, the vessel was equipped with new accommodation modules comprising 282 single cabins, and the hull and structure, machinery and general systems and equipment were upgraded. In July 2009, the Petroleum Safety Authority Norway (PSA) awarded the vessel an Acknowledgement of Compliance (AoC) required for operations in the Norwegian Continental Shelf. The AoC reflects that the technical condition of the Regalia and Prosafe's organisation and management systems are considered to be in compliance with relevant requirements in Norwegian shelf legislation. Main vessel data Registered name Regalia Built, upgraded 1985, 2003/2009 Design GVA Enhanced Max no of beds 306 (NCS: 282) Workshop 380 m2 Power generation kw (6 diesel generator sets) Fresh water production 205 tonnes / 24 hours Gangway Telescopic Hydraulic 38m +/- 7.5m Station keeping NMD3 Thrusters 6 x 2.64 MW Azimuthing Prepared in cooperation with the Joint Lead Managers 14 of 42

15 Prosafe SE, of 04. November 2014 Safe Concordia Safe Concordia is a self-propelled DP2 semi-submersible accommodation and service vessel of twin hull configuration, capable of operating in benign environments. Safe Concordia was constructed at the Keppel FELS shipyard in Singapore and was delivered in March The Safe Concordia is fitted with a Class 2 Dynamically Positioning system with four kw thrusters that enable the unit to safely operate alongside a fixed platform without the use of a conventional anchoring system. The DP system is low on fuel consumption and provides flexibility, enabling the vessel to move to another location in a relatively short period of time during operation at an oil field installation. With a large operating deck and a crane that is able to lift 120 tonnes, the vessel can manage most of the operations required by the customer. Vessel data Registered name Safe Concordia Built 2005 Max no of beds 461 Design Deepwater Technology Group Deck area m2 (laydown) Power generation kw (5 diesel generator sets) Fresh water production 160 tonnes / 24 hours Gangway Telescopic Hydraulic /- 5 m Mooring system 4 Point Wire Winches Station keeping DP2 Thrusters 4 x 2.5 MW azimuth thrusters Safe Caledonia Safe Caledonia is a DP2 semi-submersible accommodation vessel capable of operating in the most demanding geographical areas. Prepared in cooperation with the Joint Lead Managers 15 of 42

16 Prosafe SE, of 04. November 2014 The Safe Caledonia was built in 1982 at the GVA / Kockums yard in Sweden to a Pacesetter design, and was refurbished and upgraded to DP 2 / POSMOOR in The Safe Caledonia has a maximum of 454 beds, 9 offices and 78 workstations, a high level of accommodation and a fully articulated, automated gangway. The Safe Caledonia has DP2 station keeping abilities and can also deploy a 10-point wire mooring pattern, managed by a POSMOOR thruster assisted online mooring system. She is able to serve the most demanding charters in all geographical areas. The vessel was refurbished in The refurbishment not only enhanced the facilities as an accommodation vessel, but also extended the structural life time of the vessel by 20 years. Main vessel data Registered name Safe Caledonia Built, upgraded 1982, 2004, 2012 Design Pacesetter Max no of beds 454 Deck area 350 m2 Power generation KW (6 diesel generator sets) Fresh water production 200 tonnes / day Gangway Telescopic /- 5.5 m Mooring system 10 Point Wire Winches Station keeping DP2 / POSMOOR Thrusters 4 x 2.4 MW Azimuthing Safe Britannia Safe Britannia is one of Prosafe's largest semi-submersible accommodation vessels. Capable cranes, large deck areas and generous workshops and warehouse facilities make her ideal for offshore commissioning and construction support. The Safe Britannia was built in 1980 at the GVA yard in Sweden to a Friede and Goldman design of enhanced Pacesetter type. She was upgraded in 1987 by the addition of four stabilisation columns, increasing the deckload area and payload capacity. She underwent a major refurbishment in Safe Britannia has DP2 station keeping abilities, and can also deploy a 9-point wire mooring pattern, managed by a POSMOOR thruster assisted online mooring system. With a maximum of 812 beds and 104 workstations, Safe Britannia allows for projects to be coordinated on site. Capable cranes, large deck areas and generous workshops/warehouses mean that she is ideal for commissioning and construction support. Safe Britannia is currently operating on a bareboat charter in the Gulf of Mexico. Prepared in cooperation with the Joint Lead Managers 16 of 42

17 Prosafe SE, of 04. November 2014 Main vessel data Registered name Safe Britannia Built, upgraded 1980, 1987 / 2003 Design Pacesetter - Enhanced Max no of beds 812 Workshop 200 m2 Power generation kw (7 diesel generator sets) Fresh water production 200 tonnes / day Gangway Telescopic 36.5m +/- 6.0m Mooring system 9 Point Wire Winches Station keeping DP2 / POSMOOR Thrusters 4 x 2.4 MW Azimuthing, 2 x 1.5 MW Fixed Safe Lancia Safe Lancia is a DP2 semi-submersible accommodation and service vessel, upgraded to provide the optimum combination of berth capacity, work space and other functions. Safe Lancia is able to operate in benign and moderately harsh environments. Safe Lancia was built in 1982 at the GVA/Kockums yard in Sweden to a GVA 2000 design. She has a seven (7) point wire-mooring system capable of station keeping in the harshest of environments. In 2003, she was upgraded to a DP2 station keeping system. With a maximum of 550 beds and 46 workstations, Safe Lancia offers high quality and generous accommodation. Cranage and deck area provide good levels of construction and commissioning support. Safe Lancia is currently operating on a bareboat charter in the Gulf of Mexico. Main vessel data Registered name Safe Lancia Built, upgraded 1984, 2003 Design GVA 2000 Max no of beds 605 Deck area m2 Power generation kw (6 diesel generator sets) Fresh water production 300 tonnes / 24 hours Gangway Telescopic Hydraulic m /-5.5m Mooring system 7 Point Wire Winches Station keeping DP2 Thrusters 4 x 2.4 MW Azimuthing Prepared in cooperation with the Joint Lead Managers 17 of 42

18 Prosafe SE, of 04. November 2014 Safe Regency Safe Regency is a purpose built semi-submersible accommodation and service vessel which was built in 1982 at the FELS yard in Singapore to a Pacesetter design. She was upgraded in 2003 and She has an eight-point Thruster Assisted Mooring System (TAMS) utilising four 2.4 MW azimuthing thrusters capable of maintaining position in the harshest of environments. Safe Regency with 780 beds and 88 workstations together with an impressive crane capacity, provides the ideal offshore support vessel for construction, commissioning and remedial work. Safe Regency is currently operating on a bareboat charter in the Gulf of Mexico. Main vessel data Registered name Safe Regency Built, upgraded 1982, 2003/2008 Design Pacesetter Max no of beds 780 Power generation kw (6 diesel generator sets) Fresh water production 200 tonnes / 24 hours Gangway Telescopic Hydraulic 36.5 m +/- 6m Mooring system 8 Point Wire Winches Station keeping DP2 Thrusters 4 x 2.4 MW Azimuthing Safe Scandinavia Safe Scandinavia is a versatile semi-submersible accommodation vessel capable of operating in all geographical areas including the UK Continental Shelf and Norwegian Continental Shelf. Safe Scandinavia was built in 1984 at the Aker Verdal yard to an Aker H-3.2E design. Prepared in cooperation with the Joint Lead Managers 18 of 42

19 Prosafe SE, of 04. November 2014 The vessel has a twelve (12) point, all chain mooring system allowing station keeping in the harshest of environments. With a maximum of 583 beds, two workshops and 60 workstations, together with very high levels of accommodation, good cranage and a high payload capacity, Safe Scandinavia is the ideal offshore support vessel for construction, commissioning and remedial work. In April 2007, Safe Scandinavia was the first floating accommodation unit ever to be awarded Acknowledgement of Compliance (AoC) by the Norwegian Petroleum Safety Authority. The vessel underwent a major life-extension project in 2012/13, which is expected to extend the operational life of the vessel by up to 20 years. Safe Scandinavia will be temporary converted for tender support vessel ( TSV ) operations, commencing within Q Prosafe will be responsible for the provision of mud services to the Oseberg Øst installation for Statoil Petroleum AS ( Statoil ) together with all TSV marine operations. Commencement date for the operations is targeted for June Safe Scandinavia will continue to perform accommodation duties to support the installation via a telescopic gangway. Main vessel data Registered name Safe Scandinavia Built, upgraded 1984, 2003 / 2005 / 2014 Design Aker H-3.2E Max no of beds 583 (NCS: 292) Power generation kw (3 diesel generator sets) Fresh water production 200 tonnes / 24 hours Gangway Telescopic Hydraulic 36.5m +/- 6.0m Mooring system 12 Point Chain Winches Station keeping Moored Safe Astoria Safe Astoria is a semi-submersible accommodation vessel. In 2004/2005, Safe Astoria was converted to an accommodation and service vessel at Keppel FELS Shipyard in Singapore. Safe Astoria offers accommodation for 349 persons including facilities for recreation, catering, offices and plant areas. The vessel is linked to the host installation by a fully articulated, automated gangway and can also function as an emergency temporary refuge. Safe Astoria can operate in benign and moderately harsh environments. Prepared in cooperation with the Joint Lead Managers 19 of 42

20 Prosafe SE, of 04. November 2014 Main vessel data Registered name Safe Astoria Built, conversion 1983, 2005/2012 Design Sedco 600 Max no of beds 349 Deck area m2 (laydown) Workshop 551 m2 Power generation kw (4 diesel generator sets) Fresh water production 75 tonnes / day Gangway Telescopic /- 6m Mooring system 8 Point Wire Winches Station keeping Moored Safe Bristolia Safe Bristolia is a semi-submersible accommodation and service vessel which can operate in benign and moderately harsh environments. Safe Bristolia was converted to a service/accommodation vessel at Yantai Raffles Shipyard in China in In 2007/2008 she underwent further refit and modification work to qualify her for work in the UK Continental Shelf. Safe Bristolia offers accommodation for 318 (UK Continental Shelf) to 587 persons. After the conversion, the vessel has operated for Samsung Sakhalin LLC at the Sakhalin field in Russia, for the Cotemar Group (for Pemex) in Mexico and for various clients in the UK Continental Shelf. Main vessel data Registered name Safe Bristolia Built, conversion 1983, 2006 / 2008 Design Sedco 600 Max no of beds 587 Deck area 400 m2 (laydown) Workshop 340 m2 Power generation kw (4 diesel generator sets) Fresh water production 210 tonnes / day Gangway Telescopic /- 6m Mooring system 8 Point Wire Winches Station keeping Moored Prepared in cooperation with the Joint Lead Managers 20 of 42

21 Prosafe SE, of 04. November 2014 Safe Hibernia Safe Hibernia is a semi-submersible accommodation and service vessel which can operate in all geographical areas. Safe Hibernia was built in 1977 at the Rauma Repola yard in Finland to an Aker H-3 design. She has a twelve (12) point, 76mm wire mooring system, capable of station keeping in the harshest of environments. The Safe Hibernia with a maximum of 632 beds and 6 offices allows for projects to be coordinated on site. With two propellers, capable cranes, large deck areas and generous workshops / warehouses, she provides good levels of construction and commissioning support. Safe Hibernia is currently on a bareboat charter in the Gulf of Mexico. Main vessel data Registered name Safe Hibernia Built, upgraded 1977, 1991/1994/2006 Design Aker H-3 (modified) Max no of beds 632 Power generation (4 diesel generator sets) Fresh water production 150 tonnes / 24 hours Gangway Telescopic 36 +/- 6m Mooring system 12 Point Wire Winches Thrusters 2 x HP Propulsion (Aft) Station keeping Moored Jasminia Jasminia is a semi-submersible accommodation and service vessel, upgraded to provide the optimum combination of berth capacity, work space and other functions. Jasminia was built in 1982 at the GVA yard in Sweden to a GVA 2000 design. She has an eight (8) point wiremooring system capable of station keeping in the harshest of environments. Prepared in cooperation with the Joint Lead Managers 21 of 42

22 Prosafe SE, of 04. November 2014 With a maximum of 535 beds and 5 offices, the Jasminia offers high quality and generous accommodation. Together with two (2) 2.4 MW azimuthing thrusters, Jasminia allows the client to mobilise / demobilise at short notice. Jasminia is currently operating on the Cantarell field in Mexico. Main vessel data Registered name Jasminia Built, upgraded 1982, 2002 Design GVA 2000 Max no of beds 535 Power generation kw (3 diesel generator sets) Fresh water production 270 tonnes / 24 hours Gangway Rigid, Simpe Span 34 +/- 3.0m Mooring system 8 Point Wire Winches Station keeping Moored Thrusters 2 x 2.4 MW Azimuthing For more technical information about the fleet see: New builds New build 1 Safe Boreas Prosafe has entered into a turnkey contract for the construction of a semi-submersible accommodation vessel at Jurong Shipyard Pte Ltd. in Singapore. Based on the technical specifications relating to mooring and DP capabilities, Prosafe believes that the new unit will be the most advanced and efficient harsh environment accommodation vessel in the world and will be constructed to comply with Norwegian regulations. The vessel will be constructed according to the GVA 3000E design and will be equipped with a DP3 (dynamic positioning) system as well as a 12 point mooring arrangement. This will allow for operations in harsh environments both in DP and anchored mode, providing maximum cost efficiency and flexibility. The unit will have the capacity to accommodate 450 persons in single man cabins. The vessel will be named Safe Boreas. Boreas is the name of the Greek god of the north wind and the bringer of cold winter air. The name reflects that the new vessel is designed for operating in the Norwegian and UK Continental Shelf, a geographical area known for its cold climate and harsh winters. Construction work for Safe Boreas is in the final phase, and delivery from the yard is scheduled for Q The vessel will commence operations for Lundin in the Norwegian Continental Shelf in Q Prepared in cooperation with the Joint Lead Managers 22 of 42

23 Prosafe SE, of 04. November 2014 Main vessel data Registered name Safe Boreas Built To be completed Q Design GVA 3000E Max no of beds 450 (all in single cabins) Deck area approx. 2,100 m2 Gangway Telescopic hydraulic 38.5 m +/- 7.5 m Mooring system 12 point mooring system Station keeping DP3 Thrusters 6 x 4.4 MW Azimuthing New build 2 Safe Zephyrus On 19 November 2012, Prosafe entered into a contract for the construction of a semi-submersible accommodation vessel at Jurong Shipyard Pte Ltd ( JSPL ) in Singapore. Delivery of the vessel from the yard is scheduled for Q With a similar design to Safe Boreas, which also is presently under construction at JSPL, Prosafe believes that the new unit will be the world s most advanced and versatile accommodation unit, constructed to comply with Norwegian regulations and capable of operating in the harshest environments and with the highest standards of safety. As the Safe Boreas, the new unit will be constructed according to the GVA 3000E design and equipped with a DP3 (dynamic positioning) system as well as a 12-point mooring arrangement. This will allow for operations in both DP and anchored mode, providing maximum cost efficiency and flexibility. The unit will have the capacity to accommodate 450 persons in single man cabins. The vessel will be named Safe Zephyrus in line with the naming of the new vessels in the fleet after the Greek mythological wind gods. Zephyrus was the west wind and bringer of light spring and early summer breezes. Main vessel data Registered name Safe Zephyrus Built Ready for operations in 2015 Design GVA 3000E Max no of beds 450 (all in single cabins) Deck area approx. 2,100 m2 Gangway Telescopic hydraulic 38.5 m +/-7.5m Mooring system 12 point mooring system Station keeping DP3 Thrusters 6 x 4.4 MW Azimuthing Prepared in cooperation with the Joint Lead Managers 23 of 42

24 Prosafe SE, of 04. November 2014 New build 3 and 4 Safe Notos / Safe Eurus Prosafe has entered into a contract with COSCO (Qidong) Offshore Co. Ltd. for the construction of two semisubmersible accommodation vessels. The vessels will be of Gusto MSC s Ocean 500 design and will be equipped with 500 beds, DP3 station keeping systems, 10-point chain mooring and 300 tonnes cranes. Accordingly, Prosafe believes that the two units will be the most advanced and flexible vessels for worldwide operations excluding Norway. The vessels will be ready for operations in The vessels will be named Safe Notos and Safe Eurus, joining Prosafe s other newbuilds Safe Boreas and Safe Zephyrus, all named after the gods of wind in Greek mythology. Main vessel data Registered name Safe Notos / Safe Eurus Built Ready for operations in 2016 Design GustoMSC s Ocean 500 Max no of beds 500 Deck area approx. 1,500 m2 Gangway Telescopic hydraulic 38.5 m +/-7.5m Mooring system 10 point mooring system Station keeping DP3 Thrusters 6 x 3.7 MW Azimuthing Prepared in cooperation with the Joint Lead Managers 24 of 42

25 Prosafe SE, of 04. November Fleet contract status Updated as at 22 October 2014 Contract and OPEX information as at 22 October 2014 Rig name Location Client name Type of contract Firm contract Option Dayrate Updates since last version are marked in blue Safe Zephyrus Norway, Ivar Aasen* Det norske Time charter Jun 16 - Dec 16 (6m) 4x1m USD Safe Boreas UK, Mariner* Statoil Time charter May 16 - Dec 16 (8m) 4m USD Norway, Edvard Grieg Lundin Time charter Apr 15 - Sep 15 (6m) 2m USD Regalia UK, Montrose Talisman Time charter late Aug 14 (450 days) 4m USD Norway, Svalin/Grane Statoil Time charter End Feb 14 (5,5m) USD Norway, Draugen Shell Time charter end Apr 13 until end Nov USD Norway, Yme Talisman Time charter Feb 12 - Aug 12 USD Norway, Yme Talisman Time charter Nov 11 - Feb 12 USD Norway, Valhall BP Time charter Jul 11 - Oct 11 USD Norway, Valhall BP Time charter Mar 11 - Jul 11 USD Norway, Valhall BP Time charter Jan 10 - Nov 10 USD Norway, Valhall BP Time charter Jul 09 - Jan 10 USD UK, MCP-01 Aker Kværner Time charter Feb 08 - Dec 08 USD Angola, Girassol Total Time charter Dec 05 - Oct 07 USD Safe Astoria Philippines, Malampaya Shell Time charter Aug 14 - Jun 14 (11m) 1m USD Indonesia Swiber Time charter end Dec 13- mid-may 14 USD Australia, North Rankin Woodside Time charter Jun 12 - Nov 12 (6m) USD Philippines, Malampaya Shell Time charter Oct 09 - Jun 10 USD Russia, Sakhalin SEIC Time charter Dec 07 - Mar 09 USD Safe Bristolia UK BG Time charter April 15 (197 days) USD UK ConocoPhillips Time charter May 14 (4m) USD UK BG Time charter Sep 14 (3m) USD UK Elf Exploration UK Time charter May - Dec 13 USD , USD from mid-october GoM, Cantarell Cotemar Group (for Pemex) Bareboat May 11 - Mar 13 USD UK, Buzzard Nexen Time charter Apr 10 - Sep 10 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Mar 09 - Jan 10 USD UK, Britannia ConocoPhillips Time charter Apr 08 - Sep 08 USD Safe Scandinavia Norway, Oseberg (TSV operation) Statoil Time charter Jun 15 - Jun 18 4x1 year etc UK, Solan Premier Oil Time charter Oct 14 (4m) 1m USD Norway, Snorre Statoil Time charter May 14 (5m) USD UK, Jasmine ConocoPhillips Time charter Apr 13 - Nov 13 USD Norway, Valhall BP Time charter Jul 12 - Feb 13 USD Norway, Eldfisk ConocoPhillips Time charter May 12 - Jun 12 USD Norway, Valhall BP Time charter Oct 11 - Mar 12 USD Norway, Snorre Statoil Time charter Apr 11 - Sep 11 USD Norway, Valhall BP Time charter Nov 10 - Mar 11 USD / Norway, Snorre Statoil Time charter May 10 - Oct 10 USD UK, Shearwater Shell Time charter Jul 09 - Sep 09 (65 days) USD Norway, Valhall BP Time charter Dec 08 - Jun 09 USD Norway, Sleipner StatoilHydro Time charter Oct 08 - Nov 08 USD Norway, Sleipner StatoilHydro Time charter Mar 08 - Oct 08 USD UK, Britannia ConocoPhillips Time charter Oct 07 - Feb 08 USD Norway, Snorre StatoilHydro Time charter Apr 07 - Sep 07 USD Prepared in cooperation with the Joint Lead Managers 25 of 42

26 Prosafe SE, of 04. November 2014 Safe Caledonia UK, ETAP BP Time charter mid-june and mid-july 2015 (13m) 3x1m, 1x14days USD UK, Golden Eagle Nexen Time charter Jun 14 (330 days) USD UK, Andrew BP Time charter Mar 13 - end-mar 14 USD UK, Everest BG Time charter Nov 11- Mar 12 USD UK, Armada BG Time charter Mar 11 - Nov 11 USD UK, Dunbar Elgin Total Time charter Jun 10 - Sep 10 USD UK, Dunbar Elgin Total Time charter Apr 09 - Jun 10 USD UK, Dunbar Elgin Total Time charter May 07 - Apr 09 USD Safe Concordia Brazil Petrobras Time charter June 14 - June 17 Around USD Brazil Petrobras Time charter May 11 - June 14 Around USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat May 09 - Oct 09 USD USA, Tahiti ChevronTexaco Time charter Aug 08 - Jan 09 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat May 06 - Jun 08 USD Jasminia GoM, Cantarell Cotemar Group (for Pemex) Bareboat Nov 13 - Dec 15 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Jan 11 - Nov 13 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Feb 09 - Dec 10 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Feb 08 - Feb 09 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Oct 03 - Feb 08 USD Safe Hibernia GoM, Cantarell Cotemar Group (for Pemex) Bareboat Dec 11 - Dec 14 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat May 08 - Dec 11 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat May 03 - May 08 USD Safe Lancia GoM, Cantarell Cotemar Group (for Pemex) Bareboat Dec 13 - Dec 16 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Aug 10 - Dec 13 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Oct 08 - Aug 10 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Apr 03 - Oct 08 USD Safe Regency GoM, Cantarell Cotemar Group (for Pemex) Bareboat Jan 14 - Dec 17 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Sep 08 - Jan 14 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Jul 03 - Aug 08 USD Safe Britannia GoM, Cantarell Cotemar Group (for Pemex) Bareboat April 13 - Dec 14 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Oct 08 - March 13 USD GoM, Cantarell Cotemar Group (for Pemex) Bareboat Oct 03 - Oct 08 USD OPEX per day** Norwegian North Sea UK North Sea Other regions Dynamically positioned semi-subm. rigs Anchored semi-submersible rigs Other SG&A * ** 2014 estimate USD 45 million Prosafe can nominate either Safe Zephyrus or Safe Boreas for this contract. Opex per day is an average estimate on an annual basis. Costs normally slightly higher in shorter off-hire periods due to intensified IRM activity and lay-up expenses. 7.6 Risk management Strategic risk Prosafe s position in the value chain Most of the Group s activities are centered around the production and maintenance phase of the life cycle of oil and gas fields. Traditionally, this represents the part of the value chain that is usually least affected by oil price variations and associated fluctuations in the pace of oil companies investments and development. Prosafe s strategic focus secures the Group a stable revenue flow combined with growth opportunities, even at times of volatile oil prices. Moreover, the Group will at all times seek to have a portfolio comprising long, mediumterm and short contracts, which confers stability and predictability, and potential for increased earnings through market fluctuations and new growth. Prosafe is able to operate in all important offshore regions of the world, which means that the Group s risk is substantially diversified in geographical terms. Competitive position Aiming for optimal combination of day rates and utilisation, and allocating the vessels between harsh and benign environments within its specified strategic direction, Prosafe is working continuously to secure the highest possible short and long-term return from its vessels. Operational risk Prosafe aims to avoid harm to personnel and equipment, as well as accidental discharges/emissions. Potential incidents are reported immediately and followed up to limit possible harm and prevent repetition. Prosafe works proactively and constructively with customers and suppliers on setting in-house goals, making continuous improvements to its routines and procedures. In addition, Prosafe endeavours to train its employees and to positively influence its partners so as to protect personnel and equipment from harm, and the natural environment from pollution caused by its own operations and those of its partners. Compliance/legal risk Insurance-related risk The Group primarily aims to cover insurance-related risk as fully as possible through insurance policies, to the extent that such cover is available and reasonably priced. The Group s insurance policies provide cover against injury to crew, damage to its vessels, loss of revenue, thirdparty liability including oil spill, employer s and director s liability and personal cover for employees relating to accident, death, disability and pension. Prepared in cooperation with the Joint Lead Managers 26 of 42

27 Prosafe SE, of 04. November 2014 Cover under hull and machinery and loss-of-hire policies for vessel loss or damage is related to the vessel s estimated market value and the value of the individual charter respectively, so that the impact of a possible loss on results is minimised. Prosafe has also taken out war risk insurance to cover physical damage and liability arising from war and terrorist actions. Financial risk Interest risk Interest on debt is in principle floating, but has been hedged to reduce the variability of cash flows in the interest payments through the use of interest rate swap agreements. Prosafe s hedging agreements totalled approximately USD 1825 million at 31 December 2013 (including USD 1200 million with forward start). Prosafe evaluates the hedge profile in relation to the repayment schedule of its loans, the company s portfolio of contracts, cash flow and cash in hand. The proportion hedged will normally be between 75 and 100 per cent for all loan terms. The average interest cost, including interest rate swap agreements, was 4.5 per cent in 2013 as opposed to 5.0 per cent in Currency risk Net cash flow from operations is typically currency-hedged using forward contracts within a time horizon of nine to twelve months. Capital expenditure in terms of general maintenance will typically be denominated in GBP and NOK. Value enhancing investments, such as upgrades and/or refurbishment programmes, will, depending on the origin of equipment and the location of the yard, tend to be in USD and EUR. To the extent that such investments are denominated in currencies other than USD, the cash flow will be hedged with the aid of currency forward contracts. Debt and interest expenses in currencies other than USD are currency-hedged on a continuous basis against the USD, so that this effectively functions as USD financing. The hedging takes the form of liquidity reserves and financial instruments. Factors such as currency exposure in the balance sheet and tax calculations will also be taken into account to the extent that they are affected by exchange rate changes. Liquidity risk Under existing credit agreements, Prosafe is required to maintain a minimum liquidity reserve of USD 65 million. Prosafe makes active use of a system for planning and forecasting the development of its liquidity, and utilises scenario analyses to secure stable and sound development. Project risk The four above-mentioned risk categories are integrated into a tool that monitors total risk exposure and risks arising from individual projects. In addition, Prosafe carries out a particular assessment of four risk factors when planning value enhancing investments such as upgrades and/or refurbishment programmes. Technical risk Project profitability Construction risk Credit assessment Technical risk analysis involves an assessment of three critical factors. Firstly, a thorough market analysis is conducted to provide guidance in terms of future demand for certain technical specifications. Secondly, the yard s ability to deliver in line with these specifications is evaluated. Thirdly, the project s fit with the overall business plan and strategic direction of the Group is established. Project profitability is essential to the undertaking and is assessed on the basis of cost effectiveness. Both incremental costs and effects are analysed in detail, while sensitivity analysis is applied to identify particular success factors and for justifying further research to reduce project uncertainty. Analysis of construction risk is undertaken to consider the possibility of cost overruns and delays. Continuous improvement of systems and work processes is vital to manage this type of risk as is a focus on securing continuity in the organisation and key positions, and maintaining relations with subcontractors and equipment suppliers. Credit assessment of yards, sub-contractors and equipment suppliers is part of Prosafe s project evaluations and risk analyses. It attempts as far as possible to reduce credit risk via parent company or bank guarantees. An overall understanding and management of the above-mentioned risk factors is important in order to ensure stable value creation for Prosafe s shareholders. Prepared in cooperation with the Joint Lead Managers 27 of 42

28 Prosafe SE, of 04. November Organizational Structure 8.1 Description of Group Prosafe SE is the parent company which directly or indirectly owns 100 % of the shares in its subsidiaries, which own and operate the vessels. The parent company provides certain Group functions such as legal, insurance, accounting and internal audit. Prosafe SE is headquartered in Larnaca (Cyprus). Prosafe has offices in Aberdeen (Scotland), Rio de Janeiro (Brazil), Singapore and Stavanger (Norway). In addition, Prosafe may have local representation in the countries where its vessels are operating. The Group has approximately 595 employees at the end of Overview of the Company s subsidiaries as at 31 December 2013: Company name Country Ownership Voting share Prosafe AS Norway 100 % 100 % Prosafe Offshore AS Norway 100 % 100 % Prosafe Management AS Norway 100 % 100 % Prosafe (UK) Holdings Limited United Kingdom 100 % 100 % Prosafe Rigs Limited United Kingdom 100 % 100 % Prosafe Offshore Limited United Kingdom 100 % 100 % Prosafe Rigs (Cyprus) Limited Cyprus 100 % 100 % Prosafe Holding Limited Cyprus 100 % 100 % Consafe Offshore AB Sweden 100 % 100 % Prosafe Rigs Pte. Ltd. Singapore 100 % 100 % Prosafe Offshore Pte. Limited Singapore 100 % 100 % Prosafe Offshore Employment Company Pte. Limited Singapore 100 % 100 % Prosafe Offshore Services Pte. Ltd. Singapore 100 % 100 % Prosafe Offshore S.a.r.l. Luxembourg 100 % 100 % Prosafe Offshore Sp.zo.o. Poland 100 % 100 % Prosafe Offshore BV Netherlands 100 % 100 % Prosafe Services Maritimos Ltda Brazil 100 % 100 % Prosafe Rigs Nigeria Ltd Nigeria 100 % 100 % 8.2 Issuer dependent upon other entities The Issuer has the overall responsibility for legal matters, corporate policies and procedures, insurances and reporting to the Board of Directors. The Issuer is also responsible for certain accounting and finance functions. The various subsidiaries typically act as operating companies or provide services to internal or external clients. Prosafe Rigs Pte Ltd is the vessel owning entity in the Group. The Issuer has issued parent company guarantees to customers on behalf of its subsidiaries in connection with the award and performance of contracts. The Issuer will in general be dependent on supply of liquidity from subsidiaries in order to serve its obligations. Prepared in cooperation with the Joint Lead Managers 28 of 42

29 Prosafe SE, of 04. November Market outlook Outlook as per October 2014: Prosafe is the clear market leader in the high-end, larger semi-submersible vessel sector of the market, in terms of market share and operational track record. In recent years there has been a strong growth in the worldwide fleet of accommodation vessels. The impact of this supply growth is most visible in the low-end of the market i.e. for smaller accommodation vessels of various types, as opposed to markets with higher entry barriers, such as the North Sea. The graph below sets out the number of existing semi-submersible accommodation vessels in the high-end of the market in which Prosafe is operating, and the increase we currently expect to see in the market segment. No. of semi-submersible accommodation vessels, by owner Prepared by Prosafe Contract inflow has been high over a longer period, but there are now signs that the demand situation is more uncertain for the short- to medium term. Several oil companies have signaled reduced Exploration & Production ( E&P) spending going forward and cost reduction programmes have been introduced. This is more apparent in the North Sea region. Despite this, the long-term drivers for demand in the North Sea market remain intact, due to an aging infrastructure, combined with oil companies continuous high focus on increased recovery rate, which is leading to a growing amount of maintenance, upgrade and life extension projects requiring accommodation vessel support. There are several potential development projects in the pipeline in the long term, which may generate accommodation services for hook-up and commissioning of new production installation. This is particularly visible in the North Sea market, but there is also evidence of such developments in other markets. In summary, the general outlook for the global offshore accommodation market has become more uncertain, as oil companies announcements of budget cuts have led to fewer tenders. The long-term demand outlook remains positive due to need for offshore accommodation services related to maintenance and upgrades of an aging production infrastructure, hook-up and commissioning of new facilities and decommissioning of old fields. Operational update as per October 2014: Five of Prosafe s vessels are on bareboat charters with Interpetroleum Services Limited for ultimate use by Pemex in Mexico. The five vessels have contracts as follows; Safe Britannia until December 2014, Jasminia until December 2015, Safe Regency until December 2017, Safe Lancia until December 2016 and Safe Hibernia until December Safe Bristolia is operating for BG International Limited in the UK Continental Shelf until mid-december 2014, and will subsequently commence a contract for BG International Limited in April 2015 until mid-october Regalia is operating for Talisman Sinopec Energy (UK) Limited in UK Continental Shelf until end- November Prepared in cooperation with the Joint Lead Managers 29 of 42