Ann: Buffalo Project Update, page-16

Hi Cosmo

Yes the sale was last year and NOGA are reqd to maintain it to a certain standard under regulations. It's just that the cost of maintaining it to the required standard will increase. A good paint system lasts around 15 years in the offshore environment. After that you get more corrosion occurring each year. Blasting and painting offshore is expensive and the grit has to be contained.

Access to many things is difficult. Alot of work is done by the rope access crews but they can't grit blast whilst suspended in their harnesses - need to build scaffold which is more labour. Anytime personnel have to work over or near the side a standby vessel is reqd in case someone falls in the drink.

Most repairs that require welding need to be done during a shutdown. If you're welding or painting in a confined space there's more precautions required.

All this stuff just means it's very expensive to do repairs and maintenance offshore, but like an old car, you have no choice. If you ignore problems they turn into bigger problems!

The Cossack Pioneer was about 15 years old when Woodside sold it and replaced it with the Okha. I think it went to Africa where the regulations are a little less stringent and labour costs for maintence is lower.

Anyway it's no big deal for CVN but as I said don't rely on the NE being around too much longer.