Swire Pacific Subsidiary Invests in US$200 Million Icebreakers

Prisco Swire Offshore Limited (PSO), a 50/50 joint venture held between Swire Pacific Offshore Holdings Limited (SPO) and Nakhodka based Primorsk Shipping Company (Prisco), has signed a Letter of Intent with Sakhalin Energy Investment Company (SEIC) on 1st October 2004. The joint venture is to provide and manage three ice breaking supply vessels to SEIC for its oil field development and production off the Coast of Sakhalin Island for 15 years beginning from 2006.

PSO will invest approximately US$200 million to acquire three ice breaking Platform Supply Vessels of approximately 90m in length. Deliveries are scheduled for April, July and October of 2006. SPO's investment will be financed internally by Swire Pacific Limited, the parent company of SPO.

Prisco owns a fleet of 43 tankers, the majority of which are ice-class, and regularly trades along the Russian coast between Murmansk and Vladivostok.

SPO owns a modern fleet of over 50 vessels, including anchor handling tug supply boats, as well as specialised hydrographic and seismic survey vessels. It plays a major role in supporting the offshore oil and gas industry worldwide.

SEIC is a 100% foreign owned venture in Russia; with Shell owning 55%, Mitsui; 25% and Mitsubishi; 20%. SEIC has the concession for Sakhalin 2. The SEIC undertaking represents the largest single foreign direct investment project in Russia, requiring an investment of approximately US$10 billion.