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Badger Explorer Signs Long Term Partner Agreement With China National Petroleum Corporation Drilling Research Institute

STAVANGER, Norway -- Badger Explorer ASA (BXPL) has signed a co-operation agreement concerning a potential long term agreement with China National Petroleum Corporation Drilling Research Institute (CNPC DR), whereby CNPC DR will become a sponsoring partner in the development of the Badger Explorer autonomous drilling tool.

By entering this agreement, CNPC DR will become a partner in the current demonstrator program on equal terms with the existing four partners, Statoil, ExxonMobil, Chevron and Wintershall.

In addition, CNPC DR has, according to the co-operation agreement, indicated potential support for the next phase of development as a sponsoring partner in the Badger Explorer development program. CNPC DR has also expressed considerable interest in assisting in the planning and execution of the first Badger Explorer field pilots.

To become on equal terms with the existing partners, CNPC DR will pay a step-up fee equal to the financial contribution committed by each of the current partners.

“Negotiations have been ongoing for some time and we are delighted that China National Petroleum Corporation Drilling Research Institute has decided to become our fifth sponsor of the Badger Explorer activities," says Steinar Bakke, CEO of BXPL.

The co-operation agreement with CNPC DR will further strengthen Badger Explorer ASA and will accelerate the development of the Badger technology.

BXPL has to date reached all goals set for completing the demonstrator program (completion of the second generation pilot tool) around year end 2014. BXPL will at that time launch the final stage of the development program leading up to a commercial Badger Explorer tool.

The board of directors is very pleased that a new and the fifth partner has joined the demonstrator program. The board is convinced that CNPC DR will be a strong contributor to secure future commercial operations and sale of Badger Explorer services. The agreement with CNPC DR is regarded as a major step forward for BXPL.

The main focus for the BXPL organization during H2 2014 will be to finalize the demonstrator program, secure participation from the partners in the development program and kick off this program. The board of directors is confident that the remaining milestones of the Badger explorer demonstrator program will be delivered as planned by the end of 2014. Furthermore, the board is optimistic regarding the partners' continued support of the Badger Explorer development program which will reduce the time to market for the commercial Badger Explorer tool.