[0] Petroleum Geo-Services Achieves Record Revenue with Strong Geophysical Growth.

Business Editors

HOUSTON & OSLO, Norway--(BUSINESS WIRE)--Oct. 24, 2001

Petroleum Geo-Services ASA (NYSE:PGO) (OSE:PGS)

Financial Highlights

-- Third quarter diluted earnings per share (before unusual items) is $0.16,
compared to $0.17 for the 2000 third quarter and $0.10 for the 2001 second
quarter

-- Diluted earnings per share (before unusual items) is $0.38 for the nine
months ended September 30, 2001, compared to $0.37 for the nine months ended
September 30, 2000

-- Third quarter revenue increases by 17% over the 2000 third quarter and by
13% over the 2001 second quarter; revenue for the nine months ended September
30, 2001 increases by 9% over the prior year

-- Third quarter Geophysical Operations revenue increases by 38% over the 2000
third quarter and by 15% over the 2001 second quarter; third quarter
Geophysical Operations revenue of $168.4 million is at the highest quarterly
level since inception

-- Third quarter multi-client pre-funding revenue is reduced as new
multi-client investment programs are curtailed in response to an improved
contract market

-- Third quarter Production Operations revenue increases by 10% over the 2001
second quarter and decreases by 3% from the 2000 third quarter

-- Third quarter operating profit (before unusual items) increases by 72% and
26% over the 2001 first and second quarters, respectively, and decreases by 13%
from the 2000 third quarter

Operating Highlights

-- PGS enters final negotiation stages with China National

Chemicals Import and Export Corporation (Sinochem) for the

sale of Atlantis

-- PGS completes the industry's largest high-density,

single-source 3D seismic contract, using the Ramform Victory

to deploy a record-breaking, 16-streamer configuration (4,500

meter length per streamer) and complete acquisition over a

period of time (4 months) that previously could only be

achieved in the traditional, dual-source mode

-- PGS finalizes a three-year agreement with IBM that can double

its current data processing capability, yielding more than one

teraflop of additional, high-performance capacity - the

agreement allows PGS to draw the additional capacity as and

when needed

-- Petrojarl Foinaven achieves a new daily production milestone

of 132,000 barrels - this achievement was made possible by the

newly-completed capacity upgrade, which has increased the

Petrojarl Foinaven's maximum daily liquid throughput to

180,000 barrels

-- Petrojarl I begins production on the Glitne field, with

expected initial peak production of 38,000-40,000 barrels of

oil per day - this contract is the Petrojarl I's tenth

consecutive North Sea contract and PGS' first life-of-field

contract in Norwegian waters

-- Ramform Banff continues to operate with less than 1% downtime

since returning to the Banff field in March 2001

    Petroleum Geo-Services ASA (NYSE: PGO; OSE: PGS) reported today
third quarter revenue of $290.0 million, which was 17% greater than
third quarter 2000 revenue. PGS' revenue mix between Geophysical
Operations and Production Operations for the 2001 third quarter was
58% and 42%, respectively, compared to 49% and 51%, respectively, for
the 2000 third quarter. The shift in the revenue mix resulted from an
improved contract seismic market and the temporary reduction in FPSO
operations as PGS has undertaken significant FPSO upgrades during
2001. Compared to the 2001 second quarter, revenue for the 2001 third
quarter increased by 13%.

    For the nine months ended September 30, 2001, revenue of $757.1
million was 9% greater than revenue for the comparable prior year
period. PGS' revenue mix of Geophysical Operations and Production
Operations for the nine months ended September 30, 2001 was 57% and
43%, respectively; the revenue mix for the comparable prior year
period was 50% and 50%. As discussed above, the 2001 year-to-date
revenue mix resulted from the improved contract seismic market and the
planned, temporary reductions in PGS' production capabilities.

    Third quarter operating profit (before unusual items) was $43.9
million, which was 13% lower than operating profit for the 2000 third
quarter due to the temporary reduction in FPSO operations. However,
compared to the 2001 first and second quarters, this third quarter
profit was increased by 72% and 26%, respectively. Third quarter
operating profit margin (before unusual items) was 15%; although this
margin was down from the 20% margin for the 2000 third quarter, it has
steadily increased from 12% and 14% in the 2001 first and second
quarters, respectively. These steadily improving operating profit
statistics reflected the strengthening of the contract seismic market
and the resumption of full FPSO production.

    For the nine months ended September 30, 2001, operating profit
(before unusual items) of $104.3 million was 13% less than operating
profit for the prior year period and carried a 14% margin, compared to
a 17% operating profit margin for the nine months ended September 30,
2000. The lower level of 2001 operating profit (before unusual items)
was primarily attributed to higher multi-client amortization rates and
the temporary reduction in FPSO operations.

    Third quarter net income (before unusual items) was $16.4 million,
compared to $17.3 million for the 2000 third quarter and $10.0 million
for the 2001 second quarter. Third quarter diluted earnings per share
(before unusual items) was $0.16, compared to $0.17 for the 2000 third
quarter and $0.10 for the 2001 second quarter. Net income (before
unusual items) for the nine months ended September 30, 2001 was $38.5
million, approximately equivalent to the $38.2 million of net income
for the nine months ended September 30, 2000. Diluted earnings per
share (before unusual items) for the nine months ended September 30,
2001 was $0.38, up 3% from the $0.37 of the prior year period.

    Reidar Michaelsen, Chairman of the Board and Chief Executive
Officer, stated, "The 2001 third quarter represented a significant
milestone for PGS, as we celebrated our ten-year anniversary. PGS
began operations in the third quarter of 1991 and, despite some
difficult times, in the third quarter of 2001 we have achieved the
highest revenue level in our brief history. The revenue level achieved
this quarter is also significant because it keeps PGS on track to
exceed $1 billion in annual revenue for 2001. With all FPSO upgrade
work completed and the assets back in full production, we expect to
generate significant free cash flow from Production Operations going
forward. Our Geophysical Operations maintains a solid backlog and --
despite brief delays in completing a handful of data sales following
the September 11th tragedy -- the business appears to have returned to
normal levels."

    Michaelsen went on to say, "As a PGS shareholder myself, I am very
disappointed with our share price. The current value of PGS' shares
indicates that the technology advantages and strong market positions
that PGS has established in its two core businesses are not fully
appreciated. Further, we believe that during 2001 we have dramatically
improved our future prospects: we have reorganized our business; sold
our data management business for a significant gain; progressed to
final negotiations for the sale of Atlantis; captured a key share of
the expanding international contract seismic market; restored the
Ramform Banff to uptime performance of over 99%; completed capability
upgrades to both the Petrojarl Foinaven and the Petrojarl I; and
reduced outstanding debt levels despite the recent FPSO capital
programs. These accomplishments -- each significant in their own right
-- took a great deal of focus and effort, and it is my hope that in
the near future these accomplishments will be better appreciated by
the market. We will continue to work to improve the productivity,
margins and free cash flows generated by our core businesses, and we
will utilize these improvements to reduce our debt while remaining
committed to the development of revolutionary technologies."


    Review of Geophysical Operations


    For the third quarter, Geophysical Operations revenue totaled
$168.4 million, which was 38% and 15% greater than revenue for the
2000 third quarter and 2001 second quarter, respectively. The revenue
increases over both comparable periods were attributable to contract
seismic revenue (which increased by 116% between the third quarters of
2000 and 2001 and by 40% between the second and third quarters of
2001). Excluding data management revenue from the 2000 third quarter,
Geophysical Operations revenue for the 2001 third quarter was 44%
greater.

    Multi-client seismic revenue for the third quarter was $53.5
million, which was 14% less than revenue for both the 2000 third
quarter and the 2001 second quarter. These revenue decreases reflected
reduced levels of multi-client investment. Multi-client pre-funding
revenue was lower due to reduced investment, although new multi-client
projects carried higher pre-funding rates. Third quarter late sales
were 45% greater than late sales for the 2000 third quarter, with
sales from the North Sea and West African regions contributing the
greatest increases. Late sales for the 2001 third quarter were 11%
lower than 2001 second quarter sales, with most of the decrease
attributable to data license postponements in the wake of the
September 11th tragedy.

    Third quarter operating profit (before unusual items) from
Geophysical Operations was $21.6 million, which was 32% and 47%
greater than operating profit for the 2000 third quarter and 2001
second quarter, respectively. Third quarter Geophysical Operations
operating profit margin (before unusual items) was 13%, consistent
with 13% for the 2000 third quarter and improved from 10% for the 2001
second quarter.

    For the nine months ended September 30, 2001, Geophysical
Operations revenue totaled $431.3 million, which was 24% greater than
revenue for the prior year period due to increased contract seismic
revenue (increased by 76%). Excluding data management revenue from the
prior year, Geophysical Operations revenue for the nine months ended
September 30, 2001 was 31% greater. Multi-client seismic revenue for
the period was $175.0 million, which was 3% less than revenue for the
prior year period and reflected the reduction in multi-client
investment levels and associated pre-funding revenue. Late sales for
the nine months ended September 30, 2001 were 17% greater than late
sales for the prior year period, with sales from the North Sea and
West African regions contributing the greatest increases. Multi-client
seismic revenue for the nine months ended September 30, 2001 carried
an average amortization rate of 63%, compared to 57% for the nine
months ended September 30, 2000.

    Total operating profit for the nine months ended September 30,
2001 was $43.5 million, which was 16% greater than operating profit
for the comparable prior year period. Operating profit margin for the
nine months ended September 30, 2001 was 10%, compared to 11% for the
nine months ended September 30, 2000, and reflected the higher
multi-client amortization rate.


    Review of Production Operations


    For the third quarter, Production Operations revenue totaled
$121.6 million, which was 3% less than revenue for the 2000 third
quarter and 10% greater than revenue for the 2001 second quarter. The
revenue increase over the 2001 second quarter was attributable in part
to the Petrojarl Foinaven and the Petrojarl I; both FPSO vessels
completed their upgrades and resumed production during the third
quarter. Since these FPSO vessels operated for only a portion of the
third quarter, the revenue contribution for this period was 16% less
than the revenue contribution for the 2000 third quarter. However, a
partially offsetting effect was provided by the Ramform Banff, which
contributed 18% more revenue in the 2001 third quarter than in the
2000 third quarter (when production was suspended to begin that FPSO
upgrade).

    The Petrojarl Foinaven upgrade increased the maximum throughput
capacity from 144,000 to 180,000 barrels of liquid per day. Since a
significant component of PGS' compensation from the Foinaven field
includes a per-barrel tariff, the increased capacity is expected to
provide direct, incremental benefits to PGS' profitability. The
Petrojarl I upgrade included work to qualify the FPSO vessel for a
lifetime extension of 15-20 years under Norwegian Shelf conditions, to
enable gas injection capabilities and to improve its water injection
capabilities. With its fifteen years of proven experience in the North
Sea and the high barriers to entry in the Norwegian Continental Shelf,
the upgraded Petrojarl I is now well-positioned to compete for another
fifteen years of production contracts.

    For the nine months ended September 30, 2001, Production
Operations revenue totaled $325.8 million, which was 7% less than
revenue for the prior year period due to the progress of the various
FPSO upgrades during 2001: Ramform Banff was undergoing a performance
upgrade during the first quarter; the Petrojarl Foinaven undertook a
production capacity upgrade during portions of the second and third
quarters; and the Petrojarl I was upgrading its process capability and
performing regular class work maintenance during the first eight
months.

    Third quarter operating profit (before unusual items) from
Production Operations was $22.3 million, which was 35% less than
operating profit for the 2000 third quarter and 10% greater than
operating profit for the 2001 second quarter. Production Operations
operating profit margin (before unusual items) for the third quarter
was 18%, compared to 27% for the 2000 third quarter and consistent
with 18% for the 2001 second quarter. These Production Operations
operating profit statistics reflected the completion of the Petrojarl
Foinaven and Petrojarl I upgrades and their return to production
during the 2001 third quarter.

    Production Operations operating profit (before unusual items) for
the nine months ended September 30, 2001 was $60.9 million, which was
26% less than operating profit for the prior year period. Production
Operations operating profit margin for the 2001 period was 19%,
compared to 24% for the prior year period. As discussed above, the
deterioration of these operating profit statistics resulted from PGS'
FPSO upgrade activities; PGS expects these statistics to improve in
the immediate future.


    Atlantis Investment


    In 1995, PGS established Atlantis to create additional value
through the deployment of its seismic and reservoir technologies into
areas of the world where the oil and gas industry had not intensively
applied these technologies. Through its Atlantis investment, PGS
acquired interests in several petroleum concessions in the Arabian
Gulf and offshore Tunisia. Many of the prospective areas within these
concessions have now been overlayed with 3D seismic surveys, shot
almost entirely by PGS. Atlantis, together with its partners, has
drilled several of its prospects in accordance with the concession
agreements and confirmed over 500 billion cubic feet (net interest to
Atlantis) of proven and probable gas reserves in the Arabian Gulf and
over 20 million barrels (net interest to Atlantis) of proven and
probable oil reserves offshore Tunisia and in the Arabian Gulf.
Atlantis has signed a heads of agreement to finance the development
and sale of its natural gas in the Arabian Gulf and has started
development of the reserves. Production of these reserves is expected
to commence in early 2003. In Tunisia, Atlantis and its partner have
drilled three wells in the Isis oilfield and leased an FPSO vessel to
produce the reserves. The FPSO vessel is currently being installed on
the Isis field and first oil production is expected by the end of
October 2001.

    While Atlantis initially intended to generate and sell prospects
within its concessions, market conditions during 1998 and 1999 impeded
Atlantis' ability to execute this strategy. Although Atlantis has
accumulated a valuable package of exploration and production
properties, these properties are not core to PGS' ongoing oilfield
service activities. As a result of a strategic decision to divest of
non-core assets, PGS began utilizing an international investment bank
in late 2000 to assist in the sale of Atlantis. The data room prepared
for the Atlantis properties generated significant interest during this
past spring, and PGS received multiple, non-binding offers for
Atlantis. During the 2001 second quarter, PGS entered into exclusive
negotiations with Sinochem (one of the multiple bidders) for the sale
of Atlantis and believes that it is now in the final stages of
negotiating a binding agreement. Consummation of such a binding
agreement is expected to be subject to certain conditions, including
the receipt of consents and waivers from governmental authorities and
partners. While PGS is confident that the sale will be completed,
there is no assurance that a definitive agreement will be reached.


    Industry Outlook


    The market for PGS' services is largely driven by international
exploration and production spending by the large independent, major,
super-major, and national oil companies. This group of customers has
been consolidating for several years and, accordingly, had held back
on their international exploration and production spending levels.
Much of their exploration and production spending increases during the
year 2000 were focused on the North American natural gas market, where
PGS has less of a presence. During 2001, many of PGS' customers have
re-focused on international exploration and production opportunities.
As a result of this shift in focus, PGS has experienced a surge in
worldwide geophysical activity, particularly in proprietary seismic
surveys around mature reservoirs. This type of reservoir survey
requires higher-density acquisition techniques than those available
from most seismic contractors, and PGS believes that it has developed
several technologies -- including Ramform-driven HD3D, proven in a
recently completed, record-breaking North Sea survey -- that provide a
significant advantage in this marketplace. PGS has participated
enthusiastically in the industry rebound.

    However, events originating outside of our industry have created
significant uncertainty in the current outlook. In addition to the
human toll that was exacted, the tragic events of September 11th have
exacerbated a recent weakening in the global economy that could
potentially have an adverse impact on our industry. The dynamics of
the global oil and gas market could be further unsettled as the
political reaction to September 11th may possibly impact the Middle
Eastern producing region. Any sustained adverse effects on worldwide
oil and gas demand and prices could reduce exploration and development
activities and negatively impact our operations.


    Impact of Derivative Accounting Principles


    Like many international companies, PGS has periodically entered
into various economic hedging positions in order to protect
transactions from foreign exchange volatility. PGS' primary functional
currency and its reporting currency are both the US dollar (USD) and
most of its debt is denominated in USD; consequently, PGS' USD
financial statements are not exposed to large translation gains or
losses on changes in the USD/Norwegian kroner (NOK) exchange rate.
However, when PGS' USD denominated debt is converted into NOK for
Norwegian tax return purposes, unrealized translation gains and losses
associated with the USD denominated debt are taxable and deductible,
respectively, in Norway.

    In order to mitigate this tax exposure, PGS entered into economic
hedging agreements during 1998 and 1999. Effective January 1, 2001,
PGS was required to adopt the provisions of Statement of Financial
Accounting Standard No. 133 (SFAS 133), "Accounting for Derivative
Instruments and Hedging Activities," and reflect the fair value of
these hedging instruments in its financial statements. Accordingly,
the non-cash charges and gains associated with the fair value changes
during 2001 have been recorded in PGS' interim financial statements.
In the 2001 third quarter, PGS recast its first quarter financial
statements to reflect an adjustment related to the fair value of these
instruments as of January 1, 2001. This $17.9 million (net of tax)
charge has been included as an unusual item in the results for the
nine months ended September 30, 2001, but did not impact the third
quarter results. The post-adoption, periodic fair value changes
associated with these hedging instruments aggregated to $11.4 million
(net of tax) and have been reflected as unusual items for the nine
months ended September 30, 2001. The periodic fair value change
associated with the third quarter was a $1.0 million (net of tax)
benefit.


    Petroleum Geo-Services' third quarter earnings conference call is
scheduled for October 24, 2001 at 9:30 a.m. Eastern Time. Interested
parties may listen to the conference call on Petroleum Geo-Services'
web site at www.pgs.com. PGS suggests that you connect with the site
at least fifteen minutes prior to the live, listen only audio webcast
of the conference call to ensure adequate time for any software
download that may be needed to hear the call. There will be a digital
replay of the conference call beginning at 11:30 a.m. Eastern Time on
the day of the call through October 31, 2001 at [phone] or
[phone] for international callers (Passcode: 5665).


    Petroleum Geo-Services is a technologically focused oilfield
service company principally involved in two businesses: Geophysical
Operations and Production Operations. PGS acquires, processes and
markets 3D, time-lapse and multi-component seismic data. These data
are used by oil and gas companies in the exploration for new reserves,
the development of existing reservoirs, and the management of
producing oil and gas fields. PGS' advanced geophysical technologies
allows oil and gas companies to better characterize and monitor their
reservoirs in order to enhance production and ultimate recovery of
hydrocarbons. In its Production Operations business, PGS owns four
floating production, storage and offloading systems ("FPSOs") and
operates numerous offshore production facilities for oil and gas
companies. FPSOs permit oil and gas companies to produce from offshore
fields more quickly and cost effectively. PGS operates on a worldwide
basis with headquarters in Oslo, Norway and Houston, Texas.


    The information included herein contains certain forward-looking
statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. These
statements are based on certain assumptions and analyses made by the
Company in light of its experience and its perception of historical
and future trends, on general economic and business conditions and on
numerous other factors, including expected future developments, many
of which are beyond the control of the Company. Such forward-looking
statements are also subject to certain risks and uncertainties as
disclosed by the Company in its filings with the Securities and
Exchange Commission. As a result of these factors, the Company's
actual results may differ materially from those indicated in, or
implied by, such forward-looking statements.


    FINANCIAL TABLES TO FOLLOW


    To access more information, visit our web site: www.pgs.com



<PRE>

                      Petroleum Geo-Services ASA
               Consolidated Statements of Operations (1)

                                             Quarter ended
                                             September 30,
(In thousands of dollars,           ---------------------------------
 except for share data)                  2001                2000
                                    -------------       -------------
Revenue                             $     290,002       $     246,880
                                    -------------       -------------
Cost of sales                             155,497             109,605
Depreciation and amortization              71,319              65,755
Research and technology costs                 627               1,465
Selling, general and
 administrative costs                      18,677              19,695
Unusual items, net                           (675)(2)            --
                                    -------------       -------------
  Total operating expenses                245,445             196,520
                                    -------------       -------------
Operating profit (loss)                    44,557              50,360
Financial expense, net (5)                (31,716)            (36,896)
Other income (loss), net                     (575)              2,902
                                    -------------       -------------
Income (loss) before income taxes          12,266              16,366
Benefit for income taxes                   (4,844)               (946)
                                    -------------       -------------
  Net income (loss)                 $      17,110       $      17,312
                                    -------------       -------------

Basic earnings (loss) per share     $        0.17       $        0.17
                                    -------------       -------------
Diluted earnings (loss) per share   $        0.17       $        0.17
                                    -------------       -------------

Basic shares outstanding              103,005,987         102,208,350
                                    -------------       -------------
Diluted shares outstanding            103,009,900         104,023,809
                                    -------------       -------------

                                   Nine months ended       Year ended
                                      September 30,        December 31,
(In thousands of dollars,         ---------------------    -----------
 except for share data)             2001         2000          2000
                                  --------    ---------    -----------
Revenue                           $757,070    $ 695,999    $  906,233
                                  --------    ---------    -----------

Cost of sales                      387,007      317,060       423,121
Depreciation and amortization      206,273      195,441       258,484
Research and technology costs        2,818        6,736         6,677
Selling, general and
 administrative costs               56,642       57,203        75,938
Unusual items, net                 (71,870)(3)     --         378,954(4)
                                  --------    ---------    -----------
  Total operating expenses         580,870      576,440     1,143,174
                                  --------    ---------    -----------
Operating profit (loss)            176,200      119,559      (236,941)
Financial expense, net (5)         (84,196)    (100,090)     (122,933)
Other income (loss), net              (255)       8,074        89,734
                                  --------    ---------    -----------
Income (loss) before income taxes   91,749       27,543      (270,140)
Benefit for income taxes           (18,617)     (10,704)      (82,566)
                                  --------    ---------    -----------
  Net income (loss)               $110,366    $  38,247    $ (187,574)
                                  --------    ---------    -----------

Basic earnings (loss) per share   $   1.08    $    0.38    $    (1.84)
                                  --------    ---------    -----------
Diluted earnings (loss) per share $   1.08    $    0.37    $    (1.84)
                                  --------    ---------    -----------

Basic shares outstanding       102,572,775  101,909,481   102,020,830
                               -----------  -----------   -----------
Diluted shares outstanding     102,598,903  103,381,447   102,020,830
                               -----------  -----------   -----------
Notes:


      (1) Certain reclassifications have been made to conform prior year
        amounts with the current year presentation.

      (2) Unusual items, net for the quarter ended September 30, 2001
        reflects a $1.0 million after-tax benefit for the change in
        the fair value of economic hedging instruments, in accordance
        with Statement of Financial Accounting Standards No. 133 (SFAS
        No. 133), "Accounting for Derivative Instruments and Hedging
        Activities," as well as $0.3 million in one-time, after-tax
        costs associated with the rationalization of certain
        businesses.

      (3) Unusual items, net for the nine months ended September 30,
        2001 includes an $11.4 million after-tax charge to reflect the
        fair value of economic hedging instruments as well as a $17.9
        million after-tax charge as of January 1, 2001 related to
        these hedging instruments, in accordance with SFAS No. 133.
        Unusual items, net also includes a $111.9 million after-tax
        gain related to the sale of PGS' global Petrobank data
        management business and related software to Halliburton and
        the successful resolution of various tax contingencies. These
        gains were partially offset by $10.4 million in after-tax
        charges related to reorganization costs, including severance
        for the departure of several members of management during the
        period and the expected cost of the resolution of various
        pending litigation matters.

      (4) Unusual items, net for the year ended December 31, 2000
        includes the following impairment charges: $166.5 million
        related to the multi-client library, $148.8 million related to
        property, equipment and other assets, and $50.5 million
        related to loss contracts. Unusual items, net for this period
        also reflects a $13.2 million charge for the net change in
        fair value of economic hedging instruments.

      (5) For information regarding the $143.8 million liquidation
        amount of 9.625% trust preferred securities issued by PGS
        Trust I, a statutory business trust formed by the Company, see
        Note 9 in the Notes to Consolidated Financial Statements
        contained in the Company's Annual Report on Form 20-F for the
        fiscal year ended December 31, 2000. Financial expense, net
        for the quarters ended September 30, 2001 and 2000, the nine
        months ended September 30, 2001 and 2000 and the year ended
        December 31, 2000 includes approximately $3.7 million, $11.3
        million and $14.8 million, respectively, in minority interest
        related to the trust's securities. The sole assets of the
        trust are junior subordinated debentures of the Company that
        bear interest at a rate of 9.625% per year and mature on June
        30, 2039. As of December 31, 2000, the trust held $148.2
        million principal amount of such debentures.

                      Petroleum Geo-Services ASA
                    Consolidated Balance Sheets (1)


                                                    -

(In thousands of dollars,                       Sept. 30,     Dec. 31,
 except for share data)                           2001         2000
                                              -----------  -----------

Assets
Cash and cash equivalents                     $    82,500  $   145,215
Accounts receivable, net                          316,660      253,410
Other current assets                              101,021       90,030
                                              -----------  -----------
     Total current assets                         500,181      488,655
Multi-client library, net                         943,039      847,102
Property and equipment, net                     2,451,811    2,378,500
Goodwill and other long-term assets, net          587,105      578,134
                                              -----------  -----------
     Total assets                             $ 4,482,136  $ 4,292,391
                                              -----------  -----------

Liabilities and Shareholders' Equity
Short-term debt and current portion of
 long-term debt and capital lease
 obligations                                  $   243,519  $    23,892
Accounts payable and accrued expenses             296,997      308,982
Income taxes payable                               27,894       77,464
                                              -----------  -----------
     Total current liabilities                    568,410      410,338
Long-term debt and capital lease
 obligations                                    1,865,434    2,171,981
Other long-term liabilities                        75,723       78,471
Deferred income taxes                             131,760       96,260
                                              -----------  -----------
     Total liabilities                          2,641,327    2,757,050
                                              -----------  -----------
Commitments and contingencies
Guaranteed preferred beneficial interest
 in PGS junior subordinated debt
 securities (4)                                   140,852      140,050
Mandatorily redeemable cumulative
 preferred stock related to multi-client
 securitization                                   186,550         --
Shareholders' equity:
  Common stock, par value NOK 5; issued &
   outstanding 103,345,987 and 102,347,987
   shares at September 30, 2001 and
   December 31, 2000, respectively                 71,089       70,542
  Additional paid-in capital                    1,224,386    1,215,884
  Retained earnings                               250,177      139,811
  Accumulated other comprehensive loss            (32,245)     (30,946)
                                              -----------  -----------
  Total shareholders' equity                    1,513,407    1,395,291
                                              -----------  -----------
  Total liabilities and shareholders' equity  $ 4,482,136  $ 4,292,391
                                              -----------  -----------

                      Petroleum Geo-Services ASA
               Consolidated Statements of Cash Flows (1)

                                                    Quarter ended
                                                    September 30,
                                               ----------------------






                                                            ---
(In thousands of dollars)                         2001         2000
Cash flows from operating                      ---------    ---------
 activities:
  Net income (loss)                            $  17,110    $  17,312
  Adjustments to reconcile
   net income (loss) to  net cash
   provided by operating activities:
    Depreciation and amortization
     charged to expense                           71,319       65,755
    Non-cash unusual items and gain
     on sale of subsidiary, net                     --           --
    Provision (benefit) for deferred
     income taxes                                 (7,660)        (946)
    Working capital changes and
     other items                                 (44,144)     (49,917)
                                               ---------    ---------
  Net cash provided by operating
   activities                                     36,625       32,204
                                               ---------    ---------
 Cash flows from investing
  activities:
  Investment in multi-client library             (45,804)     (60,774)
  Capital expenditures                           (37,208)     (18,128)
  Sale of investment in affiliated
   company                                          --           --
  Sale of subsidiary                                --           --
  Other items, net                               (14,768)      (3,369)
                                               ---------    ---------
  Net cash (used in) investing
   activities                                    (97,780)     (82,271)
                                               ---------    ---------
 Cash flows from financing
  activities:
  Net proceeds from issuance of
   long-term debt                                   --           --
  Net proceeds from issuance of
   preferred stock                                  --           --
   Redemption of preferred stock                 (27,566)        --
  Net increase (decrease) in
   revolving and short-term debt                  62,029       63,843
  Other items, net                                (7,459)      (1,732)
                                               ---------    ---------
  Net cash provided by financing
   activities                                     27,004       62,111
                                               ---------    ---------
  Effect of exchange rate changes
   in cash and cash equivalents                      107          (52)
  Net (decrease) increase in cash
   and cash equivalents                          (34,044)      11,992
  Cash and cash equivalents at
   beginning of period                           116,544       49,119
                                               ---------    ---------
 Cash and cash equivalents at end of
  period                                       $  82,500    $  61,111
                                               ---------    ---------

                                       Nine months ended    Year ended
                                            Sept. 30,         Dec. 31,
                                     ---------------------   ---------








                                               ---
(In thousands of dollars)               2001        2000       2000
Cash flows from operating            ---------   ---------   ---------
 activities:
  Net income (loss)                  $ 110,366   $  38,247   $(187,574)
  Adjustments to reconcile
   net income (loss) to  net cash
   provided by operating activities:
    Depreciation and amortization
     charged to expense                206,273     195,441     258,484
    Non-cash unusual items and gain
     on sale of subsidiary, net       (122,351)       --       321,070
    Provision (benefit) for deferred
     income taxes                       28,128     (10,704)   (139,182)
    Working capital changes and
     other items                      (106,679)   (153,900)    (77,275)
                                     ---------   ---------   ---------
  Net cash provided by operating
   activities                          115,737      69,084     175,523
                                     ---------   ---------   ---------
 Cash flows from investing
  activities:
  Investment in multi-client library  (170,929)   (194,200)   (270,241)
  Capital expenditures                (206,893)    (53,052)   (126,883)
  Sale of investment in affiliated
   company                                --          --       150,508
  Sale of subsidiary                   175,000        --          --
  Other items, net                     (18,828)    (10,241)    (12,086)
                                     ---------   ---------   ---------
  Net cash (used in) investing
   activities                         (221,650)   (257,493)   (258,702)
                                     ---------   ---------   ---------
 Cash flows from financing
  activities:
  Net proceeds from issuance of
   long-term debt                         --       223,845     223,845
  Net proceeds from issuance of
   preferred stock                     239,271        --          --
   Redemption of preferred stock       (54,926)       --          --
  Net increase (decrease) in
   revolving and short-term debt       (76,697)    (20,070)    (34,409)
  Other items, net                     (64,385)    (17,092)    (23,865)
                                     ---------   ---------   ---------
  Net cash provided by financing
   activities                           43,263     186,683     165,571
                                     ---------   ---------   ---------
  Effect of exchange rate changes
   in cash and cash equivalents            (65)       (207)       (221)
  Net (decrease) increase in cash
   and cash equivalents                (62,715)     (1,933)     82,171
  Cash and cash equivalents at
   beginning of period                 145,215      63,044      63,044
                                     ---------   ---------   ---------
 Cash and cash equivalents at end of
  period                             $  82,500   $  61,111   $ 145,215
                                     ---------   ---------   ---------