The company's business focus will result in the closure of its 225,000 square-foot manufacturing facility at 1255 North Post Oak in the first quarter, 2004. In addition to relocating its Houston project execution staff, KOP's local workforce will be reduced by approximately 100 during the next three months. These reductions will come from manufacturing and professional support services.

KOP will relocate its Houston workforce to professional office space at a west Houston location to be determined.

KOP will share its new offices with other Aker Kvaerner business units by the end of 2004. Other Aker Kvaerner businesses are currently located at 7909 Parkwood Circle Drive in Houston, but the units are considering moving to new offices when the existing lease terminates in 2004. By sharing facilities, KOP will be able to access the resources of other Aker Kvaerner business units for the benefit of KOP clients.

"There is excess capacity in the manufacturing segment of the subsea industry globally," states Raymond Carlsen, President of KOP. "This market situation requires us to realign our capabilities with an approach which emphasise our integrated project execution model. Our project execution capability is where we intend to focus our business."

Carlsen adds the company's realignment will provide a more flexible and responsive approach, including a full range of services from EPC to individual product projects for its global and local, Gulf of Mexico clients. KOP also will expand the use of its new Industrial complex in Mobile, Alabama through deployment of its subsea wellhead, trees, umbilical, risers, and control systems to the Gulf of Mexico.

Houston will remain the global centre of excellence for engineering wellheads and trees, Carlsen explains.

Manufacturing projects will be executed by KOP's global manufacturing network with facilities in Norway, Aberdeen, Brazil and Indonesia. Some technical specialists will be relocated to Mobile, Alabama.

In addition to providing individuals time to transition to new jobs, affected workers will receive career outplacement services, severance benefits, as well as the opportunity to participate in KOP's Career Connections service. Career Connections seeks to place its affected workers in similar jobs with other Houston companies.

"We're confident KOP's strengthened business model will make us a stronger and more robust organisation in the global subsea market," Carlsen added.

ENDS

Rick Hill, Senior Vice President, Sales & Marketing, Kvaerner Oilfield Products, +1 713 685 5700

Investor Relations:
Tore Langballe, Vice President Investor Relations, Aker Kværner ASA, +47 67 51 31 06