PROS - Successfully Completed Private Placement

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PROS - Successfully Completed Private Placement

Luxembourg, 18 September 2012: Prospector Offshore Drilling S.A. (the "Company" or "PROS") - Reference is made to the stock exchange notice issued yesterday (17 September 2012)  and today, regarding a contemplated private placement of USD 60 million in new equity.

The book-building period for the private placement has closed, and the Company is pleased to announce that it has successfully completed the USD 60 million private placement directed towards Norwegian and International institutional investors.  The subscription price in the book-building was set at NOK 9.50 per VPS Offer Share and in total 36,000,000 new shares will be issued in the private placement.  The share capital increase was resolved by the Board of Directors within the authorized share capital of the Company. Following the registration of the private placement the number of shares issued in PROS will be 92,295,000, each with a nominal value of USD 0.01.

Robert W. Rose, the Company President and CEO stated today: "We are pleased with the results of the latest equity offering, which will provide the funding needed take delivery of PROSPECTOR 1 and place the rig in service for Total E&P U.K. The offering also reflects the ongoing support from our shareholder base, and excitement about the opportunities to deploy the Company's rigs when they are delivered. The high-specification jack-up market is very robust in the North Sea as well as other offshore markets, both with regard to drilling contracts and opportunities for selling rigs, and we are responding to a number of customer inquiries which require capabilities that our rigs can provide."

The net proceeds from the Private Placement will be used as a portion of the approximately USD 167 million financing necessary for the take-out of the Company's first jack-up rig at Dalian Shipbuilding Industry Offshore Co., Ltd., which is expected to become due January 2013.

Allocation notices will be distributed on 18 September 2012.  Applicants will receive shares (in the form of depository receipts) registered on a separate ISIN than the existing shares of the Company. Listing and trading of the new shares on Oslo Axess is subject to approval of a listing prospectus by the Luxembourg Commission de Surveillance du Secteur Financier (the "CSSF") expected to be given on or about 31 October 2012, at which time the new shares are contemplated to be transferred to the same ISIN as the existing shares of the Company.

The Board of Directors will conduct a subsequent repair offering of 4,700,000 shares at the same subscription price as in the private placement to existing shareholders as of 18 September 2012 that were not being offered or invited to participate in the Private Placement. The subscription  period for the repair offering is expected to commence on or about 1 November 2012.

Pareto Securities AS and SEB Enskilda acted as Joint Lead Managers and Bookrunners in the private placement.

About PROS:

PROS is a high specification jack-up drilling contractor.  PROS currently has contracts in place for the design, construction and delivery of six F&G JU2000E high specification, harsh environment (HS/HE) jack-up drilling rigs with deliveries commencing in the first quarter of 2013.  PROS has option agreements for six additional rigs of the same design.  Upon deployment, PROS, under its proven management team, will have the newest fleet of HS/HE jack-up rigs in the world, operating with the most advanced drilling systems available in the industry.

This press release contains forward-looking statements that involve risks and uncertainties.  You are cautioned not to put undue reliance on forward-looking statements because actual events and results may differ materially from the expected results described by such forward-looking statements.  Prospector Offshore Drilling S.A. disclaims any obligation to update and revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact:

Steven A. Manz

Chief Financial Officer

Prospector Offshore Drilling S.A.

Tel: +1 281 560 8010