ASKER, NORWAY (11 April 2011) - TGS-NOPEC Geophysical Company ASA (TGS) has entered into an agreement to acquire 100% of the shares of Stingray Geophysical Limited (Stingray). The transaction will provide TGS with a strong position in the rapidly growing market for Permanent Reservoir Monitoring (PRM) solutions. The acquisition will substantially increase TGS' addressable market through access to production seismic spending from large international oil companies as well as national oil companies (NOCs), while maintaining its successful asset light model.

Stingray was founded in March 2006 and is located in Guildford, United Kingdom. The company possesses unique and patented fiber-optic sensing technology for seismic PRM and other oil and gas applications.

The core technology for Stingray's fiber-optic sensing system was originally developed in the mid-nineteen eighties, for anti-submarine defense applications. Since Stingray's incorporation in 2006, Stingray has been backed by a consortium led by the venture-capitalist firms Energy Ventures, Chevron Technology Ventures,  Energy Capital Management/Statoil Venture and Cody Gate Ventures. Including the defense investment, more than USD 80 million has been invested in the technology to date. 

Robert Hobbs, CEO of TGS said, "The age of "easy to find" oil is over, forcing oil companies to increase investment in their existing fields to extend production and increase recovery factors. The acquisition of Stingray allows TGS to access a larger portion of the reservoir optimization market.   The combination of TGS and Stingray will leverage both companies' strengths to create a powerful PRM offering to the industry."

Martin Bett, Managing Director of Stingray added, "TGS brings complementary capabilities, a global organization, established seismic project management skills and financial strength to Stingray. As a part of TGS, Stingray is now well positioned to deliver innovative PRM solutions that will assist our clients to increase production and reserves whilst decreasing risk and costs of their Enhanced Oil Recovery programs."

The 4D seismic market, of which PRM is an integral and increasing part, was estimated to be over USD 1 billion in 2010 with the majority of data being acquired by towed streamers (source: ODS PetroData). Expectations are for the 4D market to exceed USD 2.5 billion within the next four years (source: Stingray estimate).  New PRM installations are expected to trend towards optical versus electrical solutions due to the expected increase in reliability and flexibility that this technology offers, especially in deep water.
  
The transferred assets include 11 employees and an extensive portfolio of intellectual property.  All management team members and employees of Stingray will continue as employees of TGS. 

The consideration for 100% of the shares is based on an initial payment of USD 45 million and incremental payments of up to USD 35 million based on the success in commercializing the technology.

The transaction is expected to complete in April 2011.

TGS has published additional information regarding Stingray on the Company's website. To access this presentation click here.  A short informational video is also available by clicking here. 

CEO Robert Hobbs will also host a conference call on 11 April 2011 at 15:00 CET (9:00 AM New York time).  Norwegian attendees are invited to call +47 2415 9757 or 800 19641, United Kingdom  attendees are invited to call +44 (0)20 7138 0845 or 0800 032 3808 and USA attendees are invited to call +1 866 602 0258. Attendees may want to call 5-10 minutes before 15:00 CET (9:00 AM NY) to ensure registration and access.

Participants will need to quote the following confirmation code when dialing into the conference: 5146498.

A Q&A session will follow a short introduction, based upon the published information. To pose a question, please press *1.

A replay of the conference call will be available shortly after. To access the replay of TGS conference call,
• dial +47 2100 0498 (Norway), +44 (0) 20 7111 1244 (United Kingdom)  or +1 347 366 9565 (USA)
• replay access code 5146498 followed by # (pound-sign)

A replay of the conference call will also be available at www.tgsnopec.com.