Extraordinary General Assembly

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Extraordinary General Assembly March 16 2007
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Thule Power at QGM- Expected delivery May
07 Rebuilt 250 ft Jack-up 30.000 feet
drilling depth Quarters up to 108 people
Automatic pipe handling Varco Drilling package
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Thule PowerCantilever with drill floor and
derrick under completion
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(No Transcript)
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Why Thule Drilling is actively supporting the
revised completion date

• Major changes in the QGM project organization
  implemented early December 2006
• Experienced personnel from Davie Shipyard engaged
  by QGM on management as well as supervisory
  levels from end December 2006
• Experienced Commissioning Manager employed from
  Keppel Fels, Singapore
• Increased Owner site team personnel
• Integration of KCA Deutag operating personnel
  into day to day construction activity
  (supervision commissioning)
• Adequate labour resources allocated (540 present
  increasing to about 580 at peak) on TP
• Optimal manning at all work fronts
• Increased manning on night shift to near dayshift
  level
• Involvement in planning by all managers and
  supervisors 3 weeks to complete the plan

• Over 1,000 CTRs (Cost Time Resources document)
  issued as basis for the new plan

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Thule Power Saudi Aramco Contract

• 4 year fixed contract, with one year option
• Commencement May 2007
• Penalties starts accruing at USD 73,500/day
  from 1 March 2007
• Contract Value USD 215 mill incl. mob
• EBITDA contribution over the fixed contract
  to Thule USD 123 mill
• Manager and Contractor KCA Deutag

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JU New buildings at QGM

• Friede Goldman Super M2 Design
• Proven design 30 units built (L780)
• 300 ft water depth w/fixation
• 30 000 ft drilling depth capacity
• Accommodation 100 people
• 3 000 ton variable load
• 57 ft cantilever reach
• Ideally suited for the Middle East area
• Delivery
• 1st unit 1st quarter 2008
• 2nd unit 2nd quarter 2008
• Both units are on schedule for these
• adjusted deliveries.

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NEWBUILDINGSAssembly site at QGMs main yard at
Hamriyah, UAE (Jan 2007)
Thule Energy Thule Force
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Thule Drilling marketing strategy newbuildings

• Thule Energy Thule Force
• Objective Long term contract for one of the
  rigs in place within 3Q 2007
• Market target Middle East South East Asia,
  where rigs are best suited
• Joint market approach with KCA Deutag to
  present to the customers a fully integrated
  Contractor
• Several bids submitted and rigs have been
  pre-qualified by several oil companies

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QGM Financial status today

• QGM is still short of funding to complete all
  three projects unless other work can be secured
  or additional funds are made available
• QGM and Thule Drilling are cooperating to find
  alternative sources for this funding
• Alternative sources being pursued
• Financial investors
• Industrial investors
• Thule Drilling already made USD 22 mill
  available
• All alternatives will probably entail change of
  control or substantial ownership transfer of
  shares in QGM
• Value of QGM is more than funding required and
  debt to Thule

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Financing May 2007
Bond Issue

• Amount USD 40 mill
• Duration 18 months
• Interest 13.75 semi annually
• Redemption USD 20 mill when 1 pri. bank
  facility is established
• Call structure 103 first 6 months, 102 next 6
  months, 101 last 6 months
• Security priority after the USD 130 mill bond
  loan

Equity issue

• Amount NOK 220 mill (aboutt USD 35 mill)
• Guaranteed by a group of existing shareholders
• Share price NOK 13.06
• Total number of shares 36.95 million 16.85
  million 53.8 million

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Reason for Additional funding Required
All numbers in USD million

• Penalty Thule Power re Saudi Aramco contract 7
• Postponed income due to delay Thule Power 8
• Locked in Escrow (operational, KCA Deutag) 5
• Additional cost / change orders Thule Power 4
• Assumed no exercise of Warrants 18
• Phoenix upgrade for sale 1
• Remaining (fees, potential yard finance,
  reserve) 41
• TOTAL 84
• Financed Through
• Equity 35
• Bond placed today 40
• Bond Feb Thule Phoenix 9
• Total 84

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Rig Mortgage overview after bond issue

• Market value of units less pledged USD 144 mill
• Market values as is

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Rig mortgage overview after delivery of Thule
Power

• Market value of units less pledged USD 176 mill
• Market values as is for Thule Energy and Thule
  Force

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Rig mortgage overview end of Q3 2008 all rigs
delivered

• Market value of units less pledged USD 375 mill
• Market values as completed Jack-ups

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Total asset (book) value and interest bearing debt
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Thule Drilling continues to be an attractive
investment case

• Thule Power is a profitable project
• Cost is still low compared with new-buildings
• Attractive contract with payback well within
  the contract term
• Two new jack-ups under construction at attractive
  prices
• Two Jack-ups delivered at the right time in an
  expected promising market
• QGM a lesson learnt Thule has better control
  of their operation
• QGMs infrastructure and yard facilities nearly
  fully upgraded (USD 20 mill invested)
• Thule Drilling favorable balance sheet with
  around 45 equity (on proforma balance)