BW Offshore announces a Voluntary Exchange Offer to acquire all Shares of Prosafe Production not currently owned by BWO

NOT FOR PUBLIC DISTRIBUTION, DIRECTLY OR INDIRECTLY,
IN OR INTO THE UNITED STATES OF AMERICA, CANADA,
AUSTRALIA OR JAPAN


21 June 2010 - BW Offshore Limited ("BWO" or "BW
Offshore"), one of the world's leading FPSO
contractors and a market leader within advanced
offshore loading and production systems to the oil
and gas industry, announced today its intention to
make a voluntary exchange offer (the "Offer") for all
of the shares of Prosafe Production Public Limited
("Prosafe Production") not currently owned by BWO.

The consideration offered will be 1.2 BWO shares and
NOK 5.25 in cash per Prosafe Production share. This
consideration corresponds to NOK 16.21 per Prosafe
Production share, based on the closing share price of
BWO on 18 June 2010 of NOK 9.13, and values the total
share capital of Prosafe Production at approximately
NOK 4.1 billion. This represents a premium of 17.0%
to the closing share price of Prosafe Production on
18 June 2010, the last trading day prior to the
announcement of the Offer and a premium of 20.1% to
the one month volume weighted average share price of
Prosafe Production for the period ending on 18 June
2010. The Offer further represents a premium of 39.6%
to the one month volume weighted average share price
of Prosafe Production for the period ending on 19
March 2010, one trading day prior to Prosafe
Production's announcement of the Letter of Intent for
the sale of its turret and swivel business
(the "Turret Business").

Carl Arnet, CEO of BWO, comments "The FPSO sector is
in need of larger companies that can meet the
increasing requirements from clients and regulators
in terms of technical competence, scope and
investments per unit. BWO is of the opinion that a
combination with Prosafe Production will create an
FPSO company with the diversification, presence,
financial scale and competence to meet such increased
requirements going forward. Through the Offer,
Prosafe Production shareholders will have the
opportunity to participate in developing an industry
leader and we believe the Offer represents a balanced
and sound transaction for the shareholder groups of
both Prosafe Production and BWO."

The cash consideration of the Offer will be financed
by BWO from available credit facilities. In
connection with the Offer, BWO has established a new
bridging credit facility of USD 1.1 billion from BW
Group Limited on competitive terms, with expiry in
November 2011. The new credit facility of USD 1.1
billion and available capacity from the existing
credit facility of USD 1.5 billion will be sufficient
to finance the entire cash consideration under the
Offer and also refinance Prosafe Production's
existing credit facilities, while also preserving
capacity for growth for the combined company going
forward. BWO will not issue any shares as a
consequence of the transaction other than the shares
to be issued to Prosafe Production shareholders as
consideration under the Offer.

The complete details of the Offer, including all
terms and conditions, will be contained in an Offer
Document to be sent to Prosafe Production
shareholders following review and approval by the
Oslo Stock Exchange and the Norwegian Financial
Supervisory Authority pursuant to Chapters 6 and 7 of
the Norwegian Securities Trading Act. As will be
further detailed and specified in the Offer Document,
the Offer will inter alia be subject to the following
conditions being satisfied or waived by BWO:

(i) The Offer, prior to the expiry of the acceptance
period for the Offer, having been accepted by
shareholders that, together with the shares already
owned by BWO, represent more than 90% of the total
number of Prosafe Production shares (on a fully
diluted basis); (ii) all necessary governmental and
regulatory approvals required in connection with the
Offer having been obtained; (iii) no governmental or
regulatory authority taking any form of legal action
(whether temporary, preliminary or permanent) that
restrains or prohibits the consummation of the Offer;
(iv) any third party consents or waivers required in
connection with the Offer having been obtained; (v)
no material adverse change occurring with respect to
Prosafe Production or any of its subsidiaries; (vi)
Prosafe Production and its subsidiaries operating in
the ordinary course of business; and (vii) no issue
of shares or equity instruments by Prosafe Production
or its subsidiaries and no distributions by Prosafe
Production.

As will be further detailed and specified in the
Offer Document, the consideration of 1.2 BWO shares
and NOK 5.25 in cash per Prosafe Production share is
conditional upon the sale by Prosafe Production of
its Turret Business on conditions as announced by
Prosafe Production in its stock exchange notice of 22
March 2010 being completed no later than two
Norwegian business days prior to expiry of the
acceptance period for the Offer. If this condition is
not met, then the Offer consideration will be reduced
to 1.2 BWO shares and NOK 2.0 in cash per Prosafe
Production share.

Prior to the Offer, BWO owns directly or indirectly
23.88% of the total number of shares in Prosafe
Production, while BW Euroholdings Limited, a wholly
owned subsidiary of BW Group (the largest shareholder
in BWO), owns 6.01% of the total number of shares in
Prosafe Production. BW Euroholdings Limited is a
close associate of BW Offshore pursuant to Section 2-
5 of the Norwegian Securities Trading Act.

BW Group Limited presently owns 66.95% of the total
number of shares in BWO. BW Group Limited will be
diluted to approximately 47% - 49% shareholding in
the combined company upon an acceptance level for the
Offer between 90% - 100%.

It is expected that the Offer Document will be sent
to Prosafe Production shareholders during the week
starting 12 July 2010. The acceptance period for the
Offer will be 20 U.S. business days from the date of
the Offer Document being released in order to allow
the Offer to be extended to certain Prosafe
Production shareholders in the United States of
America pursuant to an exemption from registration
requirements under the U.S. Securities Act (as
defined below). The acceptance period may be
extended, at any time and one or several times,
provided however that the acceptance period may not
exceed 10 weeks.

The Offer will not be made in any jurisdiction in
which the making of the Offer would not be in
compliance with the laws of such jurisdiction. This
notification does not in itself constitute an offer.
The Offer will only be made on the basis of the offer
document and can only be accepted pursuant to the
terms of such document. In the United States, the
Offer will only be made and the consideration shares
will only be offered to Prosafe Production
shareholders who are "qualified institutional buyers"
as defined in Rule 144A under the U.S. Securities Act
of 1933, as amended (the "U.S. Securities Act") in
transactions not involving any public offering within
the meaning of the U.S. Securities Act.

BWO invites analysts, investors and media to a
presentation of the Offer on Monday 21 June at 10:00
(CET) at the Carnegie Conference Center, Stranden 1B,
Aker Brygge.

The presentation will be webcast live on BWO's web
page www.bwoffshore.com

Carnegie ASA and HSBC Bank Plc are acting as
financial advisers to BWO in connection with the
Offer.

Advokatfirmaet Thommessen AS is BWO's legal advisor
as to Norwegian law in connection with the Offer.

For further information, please contact:

Carl K. Arnet, CEO BW Offshore, +65 9630 3290

Knut R. Sæthre, CFO BW Offshore, +47 9111 7876

Kristian Flaten, VP Finance and Investor Relations BW
Offshore, +47 9509 2322


About BW Offshore

BW Offshore is one of the world's leading FPSO
contractors and a market leader within advanced
offshore loading and production systems to the oil
and gas industry. BW Offshore has more than 25 years'
experience and has successfully delivered 14 FPSO
projects and 50 turrets and offshore terminals. BW
Offshore's technology division APL has delivered
solutions for production vessels, storage vessels and
tankers in a wide range of field developments.
Adapting through competence, in-house technology,
solid project execution and operational excellence,
BW Offshore ensures that customer needs are met
through versatile solutions for offshore oil and gas
projects. BW Offshore has a global network with
offices in Europe, Asia Pacific, West Africa and the
Americas. BW Offshore has 1,100 employees and is
listed on the Oslo Stock Exchange. For more
information, please visit www.bwoffshore.com and
www.apl.no.

This information is subject to the disclosure
requirements according to section 5-12 of the
Norwegian Securities Trading Act.

This announcement is not an offer for sale of any
securities in the United States. Securities may not
be offered or sold in the United States absent
registration or an exemption from registration under
the U.S. Securities Act. BW Offshore Limited has not
registered and does not intend to register any
portion of any offering of shares in the United
States or to conduct a public offering of any
securities in the United States.

This information is subject of the disclosure
requirements acc. to §5-12 vphl (Norwegian Securities
Trading Act)