Notice of Arbitration Proceedings with Oil and
Natural Gas Corporation, India (“ONGC”)

Wednesday, January 12, 2011

Reference is made to a Firm Order dated 13 June 2008 between ONGC and Sevan Marine ASA (the “Company”) for Charter Hire of an Ultra Deepwater Drilling Rig (the “Firm Order”)

The Company has issued a Notice of Arbitration to ONGC, informing ONGC of its intention to resolve certain disputes between the Company and ONGC relating to the Firm Order by reference to arbitration.

In the arbitration, the Company is disputing ONGC’s right to call on a Bank Guarantee for the sum of USD 15.9m and/or to receive monies under the Bank Guarantee on the grounds that ONGC has suffered no loss and/or that any loss suffered by ONGC does not amount to the sum of the Bank Guarantee.

The Company has filed a Petition with Indian courts seeking an order to restrain ONGC from invoking the Bank Guarantee until the disputes between ONGC and the Company are resolved by way of arbitration. ONGC will therefore not be able to invoke the Bank Guarantee until after the outcome of the Petition and any subsequent appeals.

Sevan will continue to make the appropriate announcements as and when it receives further updates on the matter.

Sevan Marine ASA is specializing in owning, operating and licensing FPSOs and drilling units, based on its patented cylindrical floater technology. Sevan Marine ASA is listed on Oslo Børs with ticker SEVAN.

Sevan Marine ASA