PGS ASA

Earnings Release • Oct 23, 2014

Petroleum Geo-Services ASA : Third Quarter 2014 Results

Petroleum Geo-Services ASA : Third Quarter 2014 Results

Challenging Market

Good Contract and Cash Flow Performance

Highlights Q3 2014

* Revenues of $394.2 million, compared to $365.6 million in Q3 2013

* EBITDA of $181.7 million, compared to $216.0 million in Q3 2013

* EBIT, excluding impairments, of $77.5 million, compared to $108.3 million in

Q3 2013

* Group EBIT margin, excluding impairments, of 20%, compared to 30% in Q3 2013

* Cash flow from operations of $230.7 million, compared to $189.4 million in

Q3 2013

* Strong balance sheet with $470.4 million liquidity reserve

* EPS of $0.04, compared to $0.35 in Q3 2013

* Bought back own shares for $4.9 million

* Sold Pacific Explorer and decommissioned Nordic Explorer, while Atlantic

Explorer is rigged down to 2D - giving quarterly operational cost savings of

approximately $10 million effective Q4 2014

* Cost reduction programs expanded and on track

"We have during Q3 experienced deteriorating market conditions, including a

weakening of the oil price. The cautious spending behaviour among oil companies

continues to negatively impact bidding, pricing and utilization. Despite the

challenging market environment we have delivered solid marine contract

performance. The benefits of attractive rates secured well in advance and good

production levels drove a significant improvement in marine contract EBIT

margins from the first half of the year, rising to 27%.

However, in MultiClient we experienced lower sales than expected. The shortfall

is primarily due to lack of pre-funding from the Triton MultiClient survey in

the Gulf of Mexico.

Subsequent to Q3 we have signed up the first Triton pre-funding. This combined

with a well pre-funded portfolio of other MultiClient projects, and the

visibility we have with 90% of Q4 capacity already booked, although at lower

rates, forms the basis for our projected Q4 earnings. The main uncertainty for

the full year now relates to MultiClient late sales. Considering the weaker

market we adjust our full year EBITDA guidance to approximately $725 million."

Jon Erik Reinhardsen,

President and Chief Executive Officer

+------------------------------------+---------------+---------------+---------+

| |   |   |   |

|  | 3(rd) Quarter | Nine months |Full year|

|Key Financial Figures +-------+-------+-------+-------+---------+

|(In USD millions, except per share |   |   |   |   |   |

|data) | 2014 | 2013 | 2014 | 2013 | 2013 |

| |   |  | | |   |

+------------------------------------+-------+-------+-------+-------+---------+

|Revenues | 394.2| 365.6|1,023.6|1,142.1| 1,501.6|

+------------------------------------+-------+-------+-------+-------+---------+

|EBITDA (as defined, see note 1) | 181.7| 216.0| 490.9| 627.9| 828.9|

+------------------------------------+-------+-------+-------+-------+---------+

|EBIT ex. impairment charges | 77.5| 108.3| 177.9| 315.7| 397.1|

+------------------------------------+-------+-------+-------+-------+---------+

|EBIT as reported | 52.5| 108.3| 143.9| 315.7| 382.1|

+------------------------------------+-------+-------+-------+-------+---------+

|Income before income tax expense | 27.4| 97.9| 74.6| 283.1| 327.9|

+------------------------------------+-------+-------+-------+-------+---------+

|Net income to equity holders | 8.4| 74.2| 42.7| 208.2| 238.3|

+------------------------------------+-------+-------+-------+-------+---------+

|Basic earnings per share ($ per | 0.04| 0.35| 0.20| 0.97| 1.11|

|share) | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

|Diluted earnings per share ($ per | 0.04| 0.34| 0.20| 0.96| 1.10|

|share) | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

|Net cash provided by operating | 230.7| 189.4| 453.0| 563.4| 775.3|

|activities | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

|Cash investment in MultiClient | 70.4| 120.9| 286.3| 262.0| 373.0|

|library | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

|Capital expenditures (whether paid | 53.1| 93.2| 334.4| 364.5| 437.8|

|or not) | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

|Total assets (at period end) |3,685.5|3,511.2|3,685.5|3,511.2| 3,544.3|

+------------------------------------+-------+-------+-------+-------+---------+

|Cash and cash equivalents (at period| 90.4| 299.0| 90.4| 299.0| 263.8|

|end) | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

|Net interest bearing debt (at period|1,039.5| 638.1|1,039.5| 638.1| 666.7|

|end) | | | | | |

+------------------------------------+-------+-------+-------+-------+---------+

The complete Q3 2014 earnings release and presentation can be downloaded from

www.newsweb.no and www.pgs.com.

FOR DETAILS, CONTACT:

Bård Stenberg, VP IR & Corporate Communications

Phone:  +47 67 51 43 16

Mobile:  +47 99 24 52 35

Petroleum Geo-Services ("PGS" or "the Company") is a focused Marine geophysical

company that provides a broad range of seismic and reservoir services, including

acquisition, imaging, interpretation, and field evaluation. The Company's

MultiClient data library is among the largest in the seismic industry, with

modern 3D coverage in all significant offshore hydrocarbon provinces of the

world. The Company operates on a worldwide basis with headquarters in Oslo,

Norway.

PGS has a presence in 22 countries with regional centers in London, Houston and

Singapore. Our headquarters is in Oslo, Norway and the PGS share is listed on

the Oslo stock exchange (OSE:PGS).

For more information on Petroleum Geo-Services visit www.pgs.com.

****

The information included herein contains certain forward-looking statements that

address activities, events or developments that the Company expects, projects,

believes or anticipates will or may occur in the future. These statements are

based on various assumptions made by the Company, which are beyond its control

and are subject to certain additional risks and uncertainties. The Company is

subject to a large number of risk factors including but not limited to the

demand for seismic services, the demand for data from our multi-client data

library, the attractiveness of our technology, unpredictable changes in

governmental regulations affecting our markets and extreme weather conditions.

For a further description of other relevant risk factors we refer to our Annual

Report for 2013. As a result of these and other risk factors, actual events and

our actual results may differ materially from those indicated in or implied by

such forward-looking statements. The reservation is also made that inaccuracies

or mistakes may occur in the information given above about current status of the

Company or its business. Any reliance on the information above is at the risk of

the reader, and PGS disclaims any and all liability in this respect

This information is subject of the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

[HUG#1865067]