SEADRILL LIMITED
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(Exact name of Registrant as specified in its charter)
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(Address of principal executive offices)
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Bermuda
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(Jurisdiction of incorporation or organization)
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Par-la-Ville Place, 4th Floor, 14 Par-la-Ville Road, Hamilton HM 08, Bermuda
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(Address of principal executive offices)
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Georgina Sousa
Par-la-Ville Place, 14 Par-la-Ville Road, Hamilton HM 08, Bermuda
Tel: +1 (441) 295-9500, Fax: +1 (441) 295-3494
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(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person
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Common stock, $2.00 par value
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New York Stock Exchange
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Title of class
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Name of exchange on which registered
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[X] Yes
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[_] No
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[_] Yes
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[X] No
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[X] Yes
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[_] No
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[X] Yes
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[_] No
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Large accelerated filer [X]
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Accelerated filer [_]
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Non-accelerated filer [_]
(Do not check if a smaller reporting company)
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Smaller reporting company [_]
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Indicate by check mark which basis of accounting the Registrant has used to prepare the financial statements included in this filing:
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[X] U.S. GAAP
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[_] International Financial Reporting Standards as issued by the International Accounting Standards Board
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[_] Other
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If ”Other” has been checked in response to the previous question, indicate by check mark which
financial statement item the Registrant has elected to follow. |
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[_] Item 17
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[_] Item 18
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[_] Yes
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[X] No
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•
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factors related to the offshore drilling market, including changes in oil and gas prices and the state of the global economy on market outlook for our various geographical operating sectors and classes of rigs;
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•
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supply and demand for drilling units and competitive pressure on utilization rates and dayrates;
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•
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customer contracts, including contract backlog, contract commencements, contract terminations, contract option exercises, contract revenues, contract awards and rig mobilizations;
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the repudiation, nullification, modification or renegotiation of contracts;
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delays in payments by, or disputes with, our customers under our drilling contracts;
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fluctuations in the market value of our drilling units and the amount of debt we can incur under certain covenants in our debt financing agreements;
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the liquidity and adequacy of cash flow for our obligations;
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our ability to successfully employ our drilling units;
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•
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our ability to procure or have access to financing;
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our expected debt levels;
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our ability to comply with certain covenants in our debt financing agreements;
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credit risks of our key customers;
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•
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political and other uncertainties, including political unrest, risks of terrorist acts, war and civil disturbances, public health threats, piracy, corruption, significant governmental influence over many aspects of local economies, or the seizure, nationalization or expropriation of property or equipment;
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•
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the concentration of our revenues in certain jurisdictions;
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•
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limitations on insurance coverage, such as war risk coverage, in certain areas;
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•
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any inability to repatriate income or capital;
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•
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the operation and maintenance of our drilling units, including complications associated with repairing and replacing equipment in remote locations and maintenance costs incurred while idle;
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•
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newbuildings, upgrades, shipyard and other capital projects, including the completion, delivery and commencement of operation dates;
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•
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import-export quotas;
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•
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wage and price controls and the imposition of trade barriers;
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•
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the recruitment and retention of personnel;
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•
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regulatory or financial requirements to comply with foreign bureaucratic actions, including potential limitations on drilling activity, changing taxation policies and other forms of government regulation and economic conditions that are beyond our control;
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•
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the level of expected capital expenditures, our expected financing of such capital expenditures, and the timing and cost of completion of capital projects;
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•
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fluctuations in interest rates or exchange rates and currency devaluations relating to foreign or U.S. monetary policy;
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•
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tax matters, changes in tax laws, treaties and regulations, tax assessments and liabilities for tax issues, including those associated with our activities in Bermuda, Brazil, Norway, the United Kingdom and the United States;
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•
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legal and regulatory matters, including the results and effects of legal proceedings, and the outcome and effects of internal and governmental investigations;
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hazards inherent in the drilling industry and marine operations causing personal injury or loss of life, severe damage to or destruction of property and equipment, pollution or environmental damage, claims by third parties or customers and the suspension of operations;
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customs and environmental matters; and
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other important factors described from time to time in the reports filed or furnished by us with the Securities and Exchange Commission, or the Commission, and the New York Stock Exchange, or the NYSE.
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TABLE OF CONTENTS
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Page
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PART 1
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ITEM 1.
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ITEM 2.
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ITEM 3
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ITEM 4.
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ITEM 4A
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ITEM 5.
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ITEM 6.
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ITEM 7.
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ITEM 8
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ITEM 9.
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ITEM 10.
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ITEM 11.
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ITEM 12.
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PART II
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ITEM 13.
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ITEM 14.
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ITEM 15
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ITEM 16.
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ITEM 16A.
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ITEM 16B.
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ITEM 16C.
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ITEM 16D.
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ITEM 16E.
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ITEM 16F.
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ITEM 16G.
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ITEM 16H.
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PART III
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ITEM 17.
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ITEM 18.
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ITEM 19.
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ITEM 1.
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IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
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ITEM 2.
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OFFER STATISTICS AND EXPECTED TIMETABLE
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ITEM 3.
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KEY INFORMATION
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A.
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SELECTED FINANCIAL DATA
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Year ended December 31,
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2015
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2014
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2013
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2012
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2011
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(In millions of U.S. dollars except common share and per share data)
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Statement of Operations Data:
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Total operating revenues
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4,335
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4,997
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5,282
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4,478
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4,192
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Net operating income
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1,019
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2,279
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2,098
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1,791
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1,774
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Net (loss)/income
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(750
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)
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4,087
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2,786
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1,205
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1,482
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(Loss)/earnings per share, basic
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(1.49
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)
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8.32
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5.66
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2.37
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3.05
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(Loss)/earnings per share, diluted
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(1.49
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)
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8.30
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5.47
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2.34
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2.96
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Dividends paid
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—
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1,415
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1,287
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1,925
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1,440
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Dividends paid per share
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—
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2.98
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2.74
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4.31
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3.14
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Dividends declared per share *
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—
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2.00
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3.72
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3.51
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3.06
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Year ended December 31,
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2015
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2014
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2013
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2012
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2011
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(In millions of U.S. dollars except
common share and per share data)
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Balance Sheet Data (at end of period):
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Cash and cash equivalents
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1,044
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831
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744
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318
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483
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Drilling units
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14,930
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15,145
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17,193
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12,894
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11,223
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Newbuildings
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1,479
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2,030
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3,419
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1,882
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2,531
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Investment in associated companies
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2,590
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2,898
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140
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509
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721
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Goodwill
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—
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604
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1,200
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1,320
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1,320
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Total assets
(1) , (2)
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23,470
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26,297
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26,048
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19,321
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18,052
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Long-term debt (including current portion)
(2)
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10,543
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12,475
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13,314
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10,663
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9,902
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Common share capital
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985
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985
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938
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938
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935
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Total equity
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9,975
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10,390
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8,202
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6,024
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6,302
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Common shares outstanding (in millions)
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492.8
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492.8
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469.0
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469.2
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467.8
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Weighted average common shares outstanding (in millions)
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492.8
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478.0
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469.0
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468.5
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458.6
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Other Financial Data:
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Net cash provided by operating activities
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1,788
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1,574
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1,695
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1,590
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1,669
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Net cash (used in)/provided by investing
activities
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(190
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)
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66
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(2,964
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)
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(1,360
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)
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(2,486
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)
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Net cash (used in)/provided by financing activities
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(1,370
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)
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(1,521
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)
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1,695
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(395
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)
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538
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Capital expenditures
(3)
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(1,041
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)
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(3,168
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)
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(4,463
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)
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(1,690
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)
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(2,543
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)
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(1)
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Historically, the Company presented balances due to/from Ship Finance International Limited (“Ship Finance”) (NYSE: “SFL”) on a gross basis. Beginning on June 30, 2015, the Company has elected to present this on a net basis due to the fact that the right of offset is established in the related long-term loan agreements with Ship Finance, and the balances are intended to be settled on a net basis, providing a more appropriate description of the Company’s related party net debt position. Accordingly the Company has represented from amounts due from related parties (current assets) to offset against long-term debt due to related parties (non-current liabilities). The total amounts represented were
$28 million
as of
December 31, 2015
,
$64 million
as of December 31, 2014, $100 million as of December 31, 2013, $213 million as of December 31, 2012, and $161 million as of December 31, 2011.
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(2)
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During the year ended December 31, 2015, the Company adopted Accounting Standards Update (“ASU”) 2015-03,
Interest—Imputation of Interest (Subtopic 835–30): Simplifying the Presentation of Debt Issuance Costs
, which requires the debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts and premiums. Accordingly, the previous year’s selected financial data has been represented to reflect the adoption of this ASU. The total amounts represented were
$118 million
as of December 31, 2015,
$145 million
as of December 31, 2014,
$152 million
as of December 31, 2013,
$98 million
as of December 31, 2012, and
$91 million
as of December 31, 2011. Please see “
Note 2
—Accounting policies” of the Notes to our Consolidated Financial Statements included herein.
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(3)
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Capital expenditures include expenditure on our drilling units and newbuildings, as well as payments for long-term maintenance.
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B.
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CAPITALIZATION AND INDEBTEDNESS
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C.
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REASONS FOR THE OFFER AND USE OF PROCEEDS
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D.
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RISK FACTORS
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•
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worldwide production and demand for oil and gas and geographical dislocations in supply and demand;
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•
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the cost of exploring for, developing, producing and delivering oil and gas;
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•
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expectations regarding future energy prices and production;
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•
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advances in exploration, development and production technology;
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•
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the ability of the Organization of Petroleum Exporting Countries (“OPEC”), to set and maintain levels and pricing;
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•
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the level of production in non-OPEC countries;
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•
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international sanctions on oil-producing countries, or the lifting of such sanctions;
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•
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government regulations, including restrictions on offshore transportation of oil and natural gas;
|
•
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local and international political, economic and weather conditions;
|
•
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domestic and foreign tax policies;
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•
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the development and exploitation of alternative fuels and unconventional hydrocarbon production, including shale;
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•
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worldwide economic and financial problems and the corresponding decline in the demand for oil and gas and, consequently, our services;
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•
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the policies of various governments regarding exploration and development of their oil and gas reserves, accidents, severe weather, natural disasters and other similar incidents relating to the oil and gas industry; and
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•
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the worldwide political and military environment, including uncertainty or instability resulting from an escalation or additional outbreak of armed hostilities or other crises in the Middle East, eastern Europe or other geographic areas or further acts of terrorism in the United States, Europe or elsewhere.
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•
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the general economic and market conditions affecting the offshore contract drilling industry, including competition from other offshore contract drilling companies;
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•
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the types, sizes and ages of drilling units;
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•
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the supply and demand for drilling units;
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•
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the costs of newbuildings;
|
•
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the prevailing level of drilling services contract dayrates;
|
•
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governmental or other regulations; and
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•
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technological advances.
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•
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terrorist acts, armed hostilities, war and civil disturbances;
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•
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acts of piracy, which have historically affected ocean-going vessels;
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•
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significant governmental influence over many aspects of local economies;
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•
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the seizure, nationalization or expropriation of property or equipment;
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•
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the repudiation, nullification, modification or renegotiation of contracts;
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•
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limitations on insurance coverage, such as war risk coverage, in certain areas;
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•
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political unrest;
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•
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foreign and U.S. monetary policy and foreign currency fluctuations and devaluations;
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•
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the inability to repatriate income or capital;
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•
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complications associated with repairing and replacing equipment in remote locations;
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•
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import-export quotas, wage and price controls, and the imposition of trade barriers;
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•
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U.S. and foreign sanctions or trade embargoes;
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•
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regulatory or financial requirements to comply with foreign bureaucratic actions;
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•
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changing taxation policies, including confiscatory taxation;
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•
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other forms of government regulation and economic conditions that are beyond our control; and
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•
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governmental corruption.
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•
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the equipping and operation of drilling units;
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•
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the repatriation of foreign earnings and exchange controls;
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•
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oil and gas exploration and development;
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•
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the taxation of offshore earnings and the earnings of expatriate personnel; and
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•
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the use and compensation of local employees and suppliers by foreign contractors.
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ITEM 4.
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INFORMATION ON THE COMPANY
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A.
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HISTORY AND DEVELOPMENT OF THE COMPANY
|
•
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Seadrill Partners, an associated company, is a Marshall Islands limited liability company formed in 2012 that focuses on owning and operating offshore drilling rigs under long-term contracts with major oil companies. In October 2012, Seadrill Partners completed its IPO in the United States of 8,750,000 common units at $22.00 per unit. Seadrill Partners was a consolidated subsidiary of Seadrill, but as of January 2, 2014, we deconsolidated Seadrill Partners from our financial statements. As of
December 31, 2015
, we own
46.6%
of the outstanding limited liability interests of Seadrill Partners, which includes outstanding common and subordinated units. Seadrill Partners’ common units trade on the NYSE under the symbol “SDLP.” We also own significant non-controlling interests in various subsidiaries of Seadrill Partners. Furthermore, we are a guarantor under certain of Seadrill Partners’ credit facilities, and we also have joint and several liability under certain of Seadrill Partners’ credit facilities. Please see Note 23 of our Consolidated Financial Statements included herein for more information.
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•
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Archer is a global oilfield service company that specializes in drilling and well services. We currently own
39.9%
of the outstanding common shares of Archer and provide various financial and performance guarantees on behalf of Archer. The total outstanding guarantees to Archer as of December 31, 2015 was
$326 million
. In addition, we have agreed to inject additional capital to Archer, in an aggregate amount of up to
$75 million
in the event that Archer will not have sufficient funds to repay and cancel commitments under its facilities by April 30, 2016.
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•
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Seabras Sapura is a group of related companies that construct, own and operate pipe-laying service vessels in Brazil. We have a
50%
ownership stake in each of these companies. We have provided Seabras Sapura with various loans to finance working capital and financial guarantees. The total amount of loans outstanding as of December 31, 2015 was $46 million, and the total amount guaranteed as of December 31, 2015 was $498 million. In addition, we provide bank guarantees in relation to certain credit facilities to cover six months of debt service costs and three months of operating expenses under retention accounts. The total amount guaranteed as of December 31, 2015 was $52 million.
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•
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SeaMex, a joint venture, that owns and operates five jack-up drilling units located in Mexico under contract with Petróleos Mexicano, or Pemex. We and an investment fund controlled by Fintech Advisory Inc., or Fintech, have a
50%
ownership stake in SeaMex, respectively. SeaMex was deconsolidated from our financial statements on March 10, 2015. We have provided a $250 million seller’s credit to SeaMex divided into two facilities: (a) a term loan facility for an amount up to $230 million and (b) a revolving loan facility of up to $20 million, and made available a subordinated unsecured credit facility of $20 million, which is to be provided by both Seadrill and Fintech at a ratio of 50.0% each. As of December 31, 2015 the facility remained undrawn. We have also provided loan facilities for a $30 million bank guarantee to the lenders of SeaMex’s external bank facility, $51 million under a joint and several guarantee for potential prepayment deficits that SeaMex might face under its loan agreements, and performance guarantees for the SeaMex drilling units, up to a total of $30 million as of December 31, 2015.
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•
|
Ship Finance is a related party of the Company through which we have entered into sale and leaseback agreements for three drilling units: the
West Taurus
,
West Hercules
and
West Linus
. As of December 31, 2015, through our VIEs we had gross loans outstanding to Ship Finance amounting to $415 million and net loans of $387 million.
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B.
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BUSINESS OVERVIEW
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•
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Grow through newbuildings and strategic acquisitions.
|
•
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Pursue long-term contracts and maintain stable cash flow.
|
•
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Provide excellent customer service and continue to prioritize safety as a key element of the company's operations.
|
•
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maintain a modern and reliable fleet.
|
•
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Floaters: We offer services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contract results reported in this segment relate to semi-submersible rigs and drillships.
|
•
|
Jack-ups: We offer services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contract results reported in this segment relate to jack-up rigs.
|
•
|
Petroleo Brasileiro S.A., or Petrobras, which accounted for approximately
19%
of our revenues;
|
•
|
Total S.A. Group, or Total, which accounted for approximately
16%
of our revenues;
|
•
|
Exxon Mobil Corp, or Exxon, which accounted for approximately
14%
of our revenues; and
|
•
|
Statoil ASA, or Statoil, which accounted for approximately
12%
of our revenues.
|
•
|
On
February 8, 2016
, we secured a new drilling contract in Angola for the
West Eclipse
, which is expected to commence in the second quarter of 2016. The contract is for a firm period of
2 years
and adds backlog of approximately
$285 million
inclusive of mobilization. As part of this agreement, the backlog for the
West Polaris
has been decreased by approximately
$95 million
, which reduces the contingent consideration that we receive from Seadrill Partners, following the sale of the
West Polaris
to Seadrill Partners in June 2015.
|
•
|
On
March 23, 2016
, we extended the contract for the
West Tellus
with Petrobras by
18 months
, commencing in April 2018 to the end of October 2019. The total backlog for the contract extension is approximately
$164 million
. As part of the agreement to extend the
West Tellus
, we agreed to a dayrate reduction on the current contract effective from February 26, 2016, resulting in a
$132 million
reduction in our backlog. The resulting net effect of this agreement is an increase in contract backlog of
$32 million
.
|
•
|
On
March 30, 2016
, Sevan Drilling and Petrobras terminated early the
Sevan Driller
contract and reduced the contract dayrate on the drilling contract for the
Sevan Brasil.
Subsequent to the effective cancellation of the Sevan Driller contract the unit was awarded a contract by Shell in Brazil for
60 days
.
The
combined impact of the cancellation, reduction and new award is a decrease in contract backlog of approximately
$127 million
.
|
|
Year ending December 31,
|
|||||||
% of rig-days committed
|
2016
|
|
|
2017
|
|
|
2018
|
|
Floaters
|
65
|
%
|
|
42
|
%
|
|
21
|
%
|
Jack-up rigs
|
56
|
%
|
|
25
|
%
|
|
10
|
%
|
C.
|
ORGANIZATIONAL STRUCTURE
|
D.
|
PROPERTY, PLANT AND EQUIPMENT
|
Unit
|
Year built
|
|
Water depth (feet)
|
|
Drilling depth (feet)
|
|
Area of location
|
|
Month of contract expiry
|
|
|
|
|
|
|
|
|
|
|
Jack-up rigs
|
|
|
|
|
|
|
|
|
|
West Epsilon
(2)
|
1993
|
|
400
|
|
30,000
|
|
Norway
|
|
December 2016
|
West Resolute
|
2007
|
|
350
|
|
30,000
|
|
Sharjah, U.A.E.
|
|
available
|
West Prospero
|
2007
|
|
400
|
|
30,000
|
|
Malaysia
|
|
May 2016
|
West Vigilant
|
2008
|
|
350
|
|
30,000
|
|
Malaysia
|
|
available
|
West Ariel
|
2008
|
|
400
|
|
30,000
|
|
Republic of Congo
|
|
February 2018
|
West Triton
|
2008
|
|
375
|
|
30,000
|
|
Sharjah, U.A.E.
|
|
available
|
West Freedom
|
2009
|
|
350
|
|
30,000
|
|
Venezuela
|
|
April 2017
|
West Cressida
|
2009
|
|
375
|
|
30,000
|
|
Thailand
|
|
April 2016
|
West Mischief
|
2010
|
|
350
|
|
30,000
|
|
Abu Dhabi
|
|
November 2017
|
West Callisto
|
2010
|
|
400
|
|
30,000
|
|
Saudi Arabia
|
|
November 2018
|
West Leda
|
2010
|
|
375
|
|
30,000
|
|
Vietnam
|
|
available
|
West Elara
(2)
|
2011
|
|
450
|
|
40,000
|
|
Norway
|
|
March 2017
|
West Castor
|
2013
|
|
400
|
|
30,000
|
|
Brunei
|
|
May 2016
|
West Telesto
|
2013
|
|
400
|
|
30,000
|
|
Malaysia
|
|
available
|
West Tucana
|
2013
|
|
400
|
|
30,000
|
|
In transit, Angola
|
|
June 2017
|
AOD-1
(3)
|
2013
|
|
400
|
|
30,000
|
|
Saudi Arabia
|
|
May 2016
|
AOD-2
(3)
|
2013
|
|
400
|
|
30,000
|
|
Saudi Arabia
|
|
July 2016
|
AOD-3
(3)
|
2013
|
|
400
|
|
30,000
|
|
Saudi Arabia
|
|
October 2016
|
West Linus
(2) (5)
|
2014
|
|
450
|
|
40,000
|
|
Norway
|
|
May 2019
|
West Titan
(NB)(1)
|
2016
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Proteus
(NB)(1)
|
2016
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Rhea
(NB)(1)
|
2016
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Tethys
(NB)(1)
|
2016
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Hyperion
(NB)(1)
|
2016
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Umbriel
(NB)(1)
|
2016
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Dione
(NB)(1)
|
2017
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
West Mimas
(NB)(1)
|
2017
|
|
400
|
|
30,000
|
|
Dalian Shipyard (China)
|
|
|
|
|
|
|
|
|
|
|
|
|
Semi-submersible rigs
|
|
|
|
|
|
|
|
|
|
West Alpha
(2)
|
1986
|
|
2,000
|
|
23,000
|
|
Norway
|
|
July 2016
|
West Venture
(2)
|
2000
|
|
2,600
|
|
30,000
|
|
Norway
|
|
available
|
West Phoenix
(2) (6)
|
2008
|
|
10,000
|
|
30,000
|
|
United Kingdom
|
|
September 2016
|
West Hercules
(5)
|
2008
|
|
10,000
|
|
35,000
|
|
Canada
|
|
January 2017
|
West Taurus
(5)
|
2008
|
|
10,000
|
|
35,000
|
|
Spain
|
|
available
|
West Eminence
|
2009
|
|
10,000
|
|
30,000
|
|
Spain
|
|
available
|
Sevan Driller
(4) (7)
|
2009
|
|
10,000
|
|
40,000
|
|
Brazil
|
|
July 2016
|
West Orion
|
2010
|
|
10,000
|
|
35,000
|
|
Brazil
|
|
July 2016
|
West Pegasus
|
2011
|
|
10,000
|
|
35,000
|
|
Mexico
|
|
August 2018
|
West Eclipse
|
2011
|
|
10,000
|
|
40,000
|
|
Angola
|
|
June 2018
|
Sevan Brasil
(4)
|
2012
|
|
10,000
|
|
40,000
|
|
Brazil
|
|
July 2018
|
Unit
|
Year built
|
|
Water depth (feet)
|
|
Drilling depth (feet)
|
|
Area of location
|
|
Month of contract expiry
|
Sevan Louisiana
(4)
|
2013
|
|
10,000
|
|
40,000
|
|
USA
|
|
May 2017
|
Sevan Developer
(NB) (1)(4)
|
2015
|
|
10,000
|
|
40,000
|
|
Cosco Shipyard (China)
|
|
|
|
|
|
|
|
|
|
|
|
|
Drillships
|
|
|
|
|
|
|
|
|
|
West Navigator
(2)
|
2000
|
|
7,500
|
|
35,000
|
|
Norway
|
|
available
|
West Gemini
|
2010
|
|
10,000
|
|
35,000
|
|
Angola
|
|
October 2017
|
West Tellus
|
2013
|
|
12,000
|
|
40,000
|
|
Brazil
|
|
October 2019
|
West Neptune
|
2014
|
|
12,000
|
|
40,000
|
|
USA
|
|
December 2017
|
West Jupiter
|
2014
|
|
12,000
|
|
40,000
|
|
Nigeria
|
|
December 2019
|
West Saturn
|
2014
|
|
12,000
|
|
40,000
|
|
Nigeria
|
|
December 2016
|
West Carina
|
2015
|
|
12,000
|
|
40,000
|
|
Brazil
|
|
June 2018
|
West Draco
(NB)(1)
|
2017
|
|
12,000
|
|
40,000
|
|
Samsung Heavy Industries (South Korea)
|
|
|
West Dorado
(NB)(1)
|
2017
|
|
12,000
|
|
40,000
|
|
Samsung Heavy Industries (South Korea)
|
|
|
West Aquila
(NB)(1)
|
2018
|
|
12,000
|
|
40,000
|
|
DSME Shipyard (South Korea)
|
|
|
West Libra
(NB)(1)
|
2019
|
|
12,000
|
|
40,000
|
|
DSME Shipyard (South Korea)
|
|
|
(1)
|
Newbuild under construction or in mobilization to its first drilling assignment.
|
(2)
|
Owned by our subsidiary NADL, in which we own
70.4%
of the outstanding shares.
|
(3)
|
Owned by AOD, in which we own
66.2%
of the outstanding shares.
|
(4)
|
Owned by Sevan Drilling, in which we own
50.1%
of the outstanding shares.
|
(5)
|
Owned 100% by Ship Finance and leased back under bareboat charter agreements. These are consolidated in our financial statements as variable interest entities. Please see
Note 35
of our Consolidated Financial Statements included herein for more information. The
West Linus
is 100% owned by Ship Finance and leased back to NADL.
|
(6)
|
The
West Phoenix
receives a reduced dayrate whilst being warm stacked during the winter period, and subsequently commenced drilling operations in April 2016.
|
(7)
|
The
Sevan Driller
contract with Shell in Brazil is for 60 days.
|
ITEM 4A.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 5.
|
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|
|
|
|
Floaters
|
|
|
|
|
|||||||
Unit type
|
Jack-up
rigs |
|
Drillships
|
|
Semi-
submersible rigs |
|
Tender
rigs |
|
Total
units |
|||||
|
|
|
|
|
|
|
|
|
|
|||||
December 31, 2012
|
16
|
|
|
4
|
|
|
12
|
|
|
11
|
|
|
43
|
|
additions
|
5
|
|
|
3
|
|
|
3
|
|
|
2
|
|
|
13
|
|
(disposals)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(11
|
)
|
December 31, 2013
|
20
|
|
|
7
|
|
|
15
|
|
|
3
|
|
|
45
|
|
additions
|
4
|
|
|
3
|
|
|
1
|
|
|
—
|
|
|
8
|
|
(disposals)
|
—
|
|
|
(3
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|
(10
|
)
|
December 31, 2014
|
24
|
|
|
7
|
|
|
12
|
|
|
—
|
|
|
43
|
|
additions
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
(disposals)
|
(5
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
December 31, 2015
|
19
|
|
|
7
|
|
|
12
|
|
|
—
|
|
|
38
|
|
•
|
our ability to successfully employ our drilling units at economically attractive dayrates as long-term contracts expire or are otherwise terminated;
|
•
|
the ability to maintain good relationships with our existing customers and to increase the number of customer relationships;
|
•
|
the number and availability of our drilling units;
|
•
|
fluctuations and the current decline in the price of oil and gas, which influence the demand for offshore drilling services;
|
•
|
the effective and efficient technical management of our drilling units;
|
•
|
our ability to obtain and maintain major oil and gas company approvals and to satisfy their quality, technical, health, safety and compliance standards;
|
•
|
economic, regulatory, political and governmental conditions that affect the offshore drilling industry;
|
•
|
accidents, natural disasters, adverse weather, equipment failure or other events outside of our control that may result in downtime;
|
•
|
mark-to-market changes in interest rate swaps;
|
•
|
foreign currency exchange gains and losses;
|
•
|
increases in crewing and insurance costs and other operating costs;
|
•
|
the level of debt and the related interest expense and amortization of principal;
|
•
|
the impairment of goodwill, investments, drilling units and other assets;
|
•
|
gains on disposals of assets;
|
•
|
interest and other financial items;
|
•
|
acquisitions and divestitures of businesses and assets;
|
•
|
tax expenses; and
|
•
|
the deconsolidation of subsidiaries.
|
|
Year ended December 31,
|
|||||||||||||
|
2015
|
|
2014
|
|
2013
|
|||||||||
|
Average
dayrates
($)
(1)
|
|
Economic utilization
(%)
(2)
|
|
Average
dayrates
($)
(1)
|
|
Economic utilization
(%)
(2)
|
|
Average
dayrates
($)
(1)
|
|
Economic utilization
(%)
(2)
|
|||
Jack-up rigs
|
197,649
|
|
|
97
|
|
179,327
|
|
|
96
|
|
168,000
|
|
|
98
|
Floaters
|
440,687
|
|
|
91
|
|
488,771
|
|
|
92
|
|
497,000
|
|
|
94
|
Tender rigs
|
N/A
|
|
|
N/A
|
|
N/A
|
|
|
N/A
|
|
152,000
|
|
|
99
|
(1)
|
Average dayrates are the weighted average dayrates for each type of unit, based on the actual days available for each unit of that type, while on contract. Average dayrates for jack-up rigs on contract increased in 2015 due to a number of contracts at lower rates coming to an end and not being replaced.
|
(2)
|
Economic utilization is calculated as the
total revenue, excluding bonuses, for the period as a proportion of the full operating dayrate multiplied by the number of days in the period.
|
•
|
Vessel and rig operating expenses are related to the drilling units we have in operation and include the remuneration of offshore crews, onshore rig supervision staff and expenses for repairs and maintenance, as well as other expenses specifically related to our drilling units.
|
•
|
Reimbursable expenses are incurred at the request of our customers, and include supplies, personnel and other services.
|
•
|
Loss on impairment of goodwill and drilling units is based on management’s review of these assets for impairment, which is done at least once each year or more often if there are factors indicating that it is more likely than not that the fair value of these assets will be lower than their respective carrying value. Please see “—Critical Accounting Estimates” below for further information.
|
•
|
Depreciation and amortization expenses are based on the historical cost of our drilling units and other equipment.
|
•
|
General and administrative expenses include the costs of our regional offices in various locations, as well as the remuneration and other compensation of our officers, directors and employees engaged in the management and administration of the Company.
|
•
|
The amount of interest expense recognized depends on the overall level of debt we have incurred and prevailing interest rates under our debt agreements. However, overall interest expense may be reduced as a consequence of the capitalization of interest expense relating to drilling units under construction.
|
•
|
Share in results from associated companies recognized relates to our share of earnings or losses in our investments accounted for as equity method investments.
|
•
|
Impairment of investments are recorded when a fall in the value of our investments is determined to be other than temporary. Management reviews our investment in marketable securities and associated companies on a quarterly basis and makes its determination on the basis of the longevity and severity of any fall in the respective value of our investments, among other available information.
|
•
|
Gains/losses recognized on derivative financial instruments reflect various mark-to-market adjustments to the value of our interest rate and forward currency swap agreements and other derivative financial instruments, and the net settlement amount paid or received on swap agreements.
|
•
|
Foreign exchange gains/loss recognized generally relate to transactions and revaluation of balances carried in currencies other than the U.S. dollar.
|
•
|
Other non-operating income or expense relates to items that generally do not fall within any other categories listed above.
|
(In $ millions)
|
Year ended December 31, 2015
|
|
Impairments of investment in associated companies
|
|
|
Seadrill Partners - Total direct ownership investments
|
302
|
|
Seadrill Partners - Subordinated units
|
125
|
|
Seadrill Partners - Seadrill Member Interest and IDRs
|
106
|
|
Total impairment of investments in associated companies
|
533
|
|
|
|
|
Impairments of marketable securities
|
|
|
Seadrill Partners - Common units
|
574
|
|
SapuraKencana
|
167
|
|
Total impairment of marketable securities investments (reclassification from OCI)
|
741
|
|
|
|
|
Total impairment of investments
|
1,274
|
|
A.
|
RESULTS OF OPERATIONS
|
•
|
Floaters: We offer services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contracts relate to semi-submersible rigs and drillships for harsh and benign environments in mid-, deep- and ultra-deep waters.
|
•
|
Jack-up rigs: We offer services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contracts relate to jack-up rigs for operations in harsh and benign environments.
|
|
Year ended December 31, 2015
|
|
Year ended December 31, 2014
|
||||||||||||||||||
In US$ millions
|
Floaters
|
|
|
Jack-
up rigs |
|
|
Other
|
|
Total
|
|
|
Floaters
|
|
|
Jack-
up rigs |
|
|
Other
|
|
Total
|
|
Total operating revenues
|
2,906
|
|
|
1,293
|
|
|
136
|
|
4,335
|
|
|
3,360
|
|
|
1,478
|
|
|
159
|
|
4,997
|
|
Loss/(gain) on sale of assets
|
(243
|
)
|
|
179
|
|
|
1
|
|
(63
|
)
|
|
632
|
|
|
—
|
|
|
—
|
|
632
|
|
Contingent consideration realized
|
47
|
|
|
—
|
|
|
—
|
|
47
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
Total operating expenses (excluding Loss on Goodwill impairment)
|
(1,807
|
)
|
|
(808
|
)
|
|
(122
|
)
|
(2,737
|
)
|
|
(2,000
|
)
|
|
(971
|
)
|
|
(147
|
)
|
(3,118
|
)
|
Goodwill impairment charge
|
(563
|
)
|
|
—
|
|
|
—
|
|
(563
|
)
|
|
—
|
|
|
(232
|
)
|
|
—
|
|
(232
|
)
|
Net operating income
|
340
|
|
|
664
|
|
|
15
|
|
1,019
|
|
|
1,992
|
|
|
275
|
|
|
12
|
|
2,279
|
|
Interest expense
|
|
|
|
|
|
(415
|
)
|
|
|
|
|
|
|
|
|
(478
|
)
|
||||
Other financial items
|
|
|
|
|
|
(1,146
|
)
|
|
|
|
|
|
|
|
|
2,305
|
|
||||
Income before taxes
|
|
|
|
|
|
(542
|
)
|
|
|
|
|
|
|
|
|
4,106
|
|
||||
Income taxes
|
|
|
|
|
|
(208
|
)
|
|
|
|
|
|
|
|
|
(19
|
)
|
||||
Net income
|
|
|
|
|
|
(750
|
)
|
|
|
|
|
|
|
|
|
4,087
|
|
|
Year ended December 31, 2014
|
|
Year ended December 31, 2013
|
|||||||||||||||||||||||||
In US$ millions
|
Floaters
|
|
|
Jack-up rigs
|
|
|
Tender Rigs
|
|
|
Other
|
|
Total
|
|
|
Floaters
|
|
|
Jack-up rigs
|
|
|
Tender Rigs
|
|
|
Other
|
|
|
Total
|
|
Total operating revenues
|
3,360
|
|
|
1,478
|
|
|
—
|
|
|
159
|
|
4,997
|
|
|
3,698
|
|
|
1,175
|
|
|
382
|
|
|
27
|
|
|
5,282
|
|
Gain on sale of assets
|
632
|
|
|
—
|
|
|
—
|
|
|
—
|
|
632
|
|
|
—
|
|
|
61
|
|
|
—
|
|
|
—
|
|
|
61
|
|
Total operating expenses
|
(2,000
|
)
|
|
(971
|
)
|
|
—
|
|
|
(147
|
)
|
(3,118
|
)
|
|
(2,226
|
)
|
|
(786
|
)
|
|
(206
|
)
|
|
(27
|
)
|
|
(3,245
|
)
|
Net operating income
|
1,992
|
|
|
275
|
|
|
—
|
|
|
12
|
|
2,279
|
|
|
1,472
|
|
|
450
|
|
|
176
|
|
|
—
|
|
|
2,098
|
|
Interest expense
|
|
|
|
|
|
|
|
|
|
|
(478
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(445
|
)
|
|
Other financial items
|
|
|
|
|
|
|
|
|
|
|
2,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,287
|
|
|
Income before taxes
|
|
|
|
|
|
|
|
|
|
|
4,106
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,940
|
|
|
Income taxes
|
|
|
|
|
|
|
|
|
|
|
(19
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(154
|
)
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
4,087
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,786
|
|
In US$ millions
|
2014
|
|
2013
|
|
Interest income
|
63
|
|
24
|
|
Share in results from associated companies (net of tax)
|
34
|
|
(223
|
)
|
(Loss)/gain on derivative financial instruments
|
(497
|
)
|
133
|
|
Net gain/(loss) on debt extinguishment
|
(54
|
)
|
—
|
|
Foreign exchange gain
|
164
|
|
52
|
|
Gain on realization of marketable securities
|
131
|
|
—
|
|
Gain on deconsolidation of Seadrill Partners
|
2,339
|
|
—
|
|
Gain on sale of tender rig business
|
—
|
|
1,256
|
|
Other financial items and other income/(expense), net
|
125
|
|
45
|
|
Total financial items and other income/(expense), net
|
2,305
|
|
1,287
|
|
B.
|
LIQUIDITY AND CAPITAL RESOURCES
|
•
|
Summary of our borrowing activities;
|
•
|
Liquidity outlook;
|
•
|
Our newbuilding program;
|
•
|
Key financial covenants related to our borrowings;
|
•
|
Sources and uses of cash;
|
(In US$ millions)
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021 and thereafter
|
|
Total
|
|
Outstanding loans
|
1,526
|
|
2,872
|
|
2,432
|
|
2,817
|
|
1,014
|
|
—
|
|
10,661
|
|
•
|
On January 22, 2015, we entered into an agreement with Dalian to defer the deliveries of eight jack-ups that were previously scheduled to be delivered in 2015 and 2016, to 2016 and 2017. On June 3, 2015, we entered into a second amendment with Dalian to defer the deliveries of four jack-ups that were previously due in 2016 to late 2016 and 2017. On April 18, 2016, we entered into agreements with Dalian to further the defer the deliveries of all eight jack-ups under construction. Following this latest deferral agreement, one unit is now scheduled to be delivered at the end of 2016, four units in 2017, and three units in 2018.
|
•
|
On
July 2, 2015, we entered into an agreement with Samsung to defer the deliveries
of two ultra-deepwater drillships, the
West Draco
and the
West Dorado
from 2015 to the first quarter of 2017.
|
•
|
On December 2, 2015, the Company signed an amendment with Jurong Shipyard (“Jurong”) for the deferral of the delivery of the semi-submersible drilling unit, the
West Rigel
(the “Unit”). The deferral period lasts until June 2016, following completion of which, the Company and Jurong have agreed to form a Joint Asset Holding Company for joint ownership of the Unit, to be owned 23% by the Company and 77% by Jurong, in the event no employment is secured for the Unit and no alternative transaction is completed.
|
•
|
On January 15, 2016, we entered into an agreement with DSME to defer the delivery of two ultra-deepwater drillships, the
West Aquila
and
West Libra
, until the second quarter 2018 and first quarter of 2019, respectively.
|
•
|
On October 30, 2015, Sevan Drilling and Cosco agreed to exercise the first six-month option of the delivery deferral agreement for the
Sevan Developer
, which extended the deferral period to April 15, 2016. In addition, on April 15, 2016, we exercised our second six-month deferral option, until October 15, 2016. Sevan Drilling and Cosco have two remaining six-month deferral options available.
|
(In US$ millions)
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021 and thereafter
|
|
Total
|
|
Newbuildings
|
188
|
|
2,158
|
|
1,174
|
|
529
|
|
—
|
|
—
|
|
4,049
|
|
•
|
6.0
:1, from and including the financial quarter starting on July 1, 2015 and including the financial quarter ending on September 30, 2016;
|
•
|
5.5
:1, from and including the financial quarter starting on October 1, 2016 and including the financial quarter ending December 31, 2016;
|
•
|
4.5
:1, from and including the financial quarter starting on January 1, 2017 until the final maturity date.
|
•
|
.125%
per annum if the leverage ratio is
4.50
:1 up to and including
4.99
:1;
|
•
|
.25%
per annum if the leverage ratio is
5.00
:1 up to and including
5.49
:1;
|
•
|
.75%
per annum if the leverage ratio is
5.50
:1 up to and including
6.00
:1
|
•
|
Extensions:
|
◦
|
$450 million Senior Secured Credit Facility
: The maturity of the
$450 million
senior secured credit facility, relating to the
Eminence
rig, has been extended from June 20, 2016 to December 31, 2016. In addition, the margin has been reset to 250 basis points.
|
◦
|
$400 million Senior Secured Credit Facility
: The maturity of the
$400 million
senior secured credit facility, relating to jack-up rigs
West Cressida
,
West Callisto
,
West Leda
and
West Triton,
has been extended from December 8, 2016 to May 31, 2017.
|
◦
|
$2 billion Senior Secured Credit Facility
: The maturity of the
$2 billion
senior secured credit facility of our majority-owned subsidiary NADL has been extended from April 15, 2017 to June 30, 2017.
|
•
|
Key amendments and waivers:
|
◦
|
Equity ratio
: The Company is required to maintain a total equity to total assets ratio of at least 30.0%. Prior to the amendment, both total equity and total assets were adjusted for the difference between book and market values of drilling units, as determined by independent broker valuations. The amendment removes the need for the market value adjustment from the calculation of the equity ratio until June 30, 2017.
|
•
|
Leverage ratio
: The Company is required to maintain a ratio of net debt to EBITDA. Prior to the amendment the leverage ratio had to be no greater than 6.0:1, falling to 5.5:1 from October 1, 2016, and falling again to 4.5:1 from January 1, 2017. The amendment retains the ratio at 6.0:1 until December 31, 2016, and then increases to 6.5:1 between January 1, 2017 and June 30, 2017.
|
•
|
Minimum-value-clauses
: The Company’s secured bank credit facilities contain loan-to-value clauses, or minimum-value-clauses (“MVC”), which could require the Company to post additional collateral or prepay a portion of the outstanding borrowings should the value of the drilling units securing borrowings under each of such agreements decrease below required levels. Subject to compliance with the terms of the amendment, this covenant has been suspended until June 30, 2017.
|
•
|
Minimum Liquidity
: The Company has previously been required to maintain a minimum of
$150 million
of liquidity. This has been reset to $250 million until June 30, 2017.
|
•
|
Additional undertakings:
|
◦
|
Further process
: The Company has agreed to consultation, information provision and certain processes in respect of further discussions with its lenders under its senior secured credit facilities. This includes agreements in respect of progress milestones towards the agreement of, and implementation plan in respect of, a comprehensive financing package.
|
◦
|
Restrictive undertakings
: The Company has agreed to additional near-term restrictive undertakings applicable during this process, including (without limitation) limitations in respect of:
|
▪
|
dividends, share capital repurchases and total return swaps;
|
▪
|
incurrence and maintenance of certain indebtedness;
|
▪
|
investments in, extensions of credit to or the provision of financial support for non-wholly owned subsidiaries;
|
▪
|
investments in, extensions of credit to or the provision of financial support for joint ventures or associated entities;
|
▪
|
acquisitions;
|
▪
|
dispositions;
|
▪
|
prepayment, repayment or repurchase of any debt obligations;
|
▪
|
granting security; and
|
▪
|
payments in respect of newbuild drilling units,
|
•
|
Other changes and provisions:
|
◦
|
Undrawn availability
: The Company has agreed to refrain from borrowing any undrawn commitments under its senior secured credit facilities.
|
◦
|
Fees
: The Company has agreed to pay certain fees to its lenders in consideration of these extensions and amendments.
|
Summary cash flow statement
|
Year ended December 31,
|
|||||||
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Net cash provided by operating activities
|
1,788
|
|
|
1,574
|
|
|
1,695
|
|
Net cash (used in)/provided by investing activities
|
(190
|
)
|
|
66
|
|
|
(2,964
|
)
|
Net cash (used in)/provided by financing activities
|
(1,370
|
)
|
|
(1,521
|
)
|
|
1,695
|
|
Cash and cash equivalents held for sale
|
—
|
|
|
(26
|
)
|
|
—
|
|
Effect of exchange rate changes on cash
|
(15
|
)
|
|
(6
|
)
|
|
—
|
|
Net increase in cash and cash equivalents
|
213
|
|
|
87
|
|
|
426
|
|
Cash and cash equivalents at beginning of the period
|
831
|
|
|
744
|
|
|
318
|
|
Cash and cash equivalents at the end of period
|
1,044
|
|
|
831
|
|
|
744
|
|
C.
|
RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.
|
D.
|
TREND INFORMATION
|
E.
|
OFF BALANCE SHEET ARRANGEMENTS
|
F.
|
CONTRACTUAL OBLIGATIONS
|
|
Payment due by period
|
|||||||||||||
(In US$ millions)
|
Less than
1 year |
|
|
1 – 3
years |
|
|
3 – 5
years |
|
|
After
5 years |
|
|
Total
|
|
Interest-bearing debt
|
1,526
|
|
|
5,304
|
|
|
3,831
|
|
|
—
|
|
|
10,661
|
|
Related party interest-bearing debt
|
—
|
|
|
—
|
|
|
—
|
|
|
415
|
|
|
415
|
|
Total debt repayments
|
1,526
|
|
|
5,304
|
|
|
3,831
|
|
|
415
|
|
|
11,076
|
|
Interest payments
|
384
|
|
|
561
|
|
|
138
|
|
|
—
|
|
|
1,083
|
|
Related party interest payments
|
19
|
|
|
37
|
|
|
37
|
|
|
90
|
|
|
183
|
|
Pension obligations
(1)
|
12
|
|
|
37
|
|
|
13
|
|
|
70
|
|
|
132
|
|
Operating lease obligations
|
11
|
|
|
18
|
|
|
12
|
|
|
13
|
|
|
54
|
|
Total contractual obligations
|
1,952
|
|
|
5,957
|
|
|
4,031
|
|
|
588
|
|
|
12,528
|
|
(1)
|
Pension obligations are the forecasted employer’s contributions to the Company’s defined benefit plans, expected to be made over the next ten years.
|
(In US$ millions)
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021 and thereafter
|
|
Total
|
|
Newbuildings
(1)
|
188
|
|
2,158
|
|
1,174
|
|
529
|
|
—
|
|
—
|
|
4,049
|
|
(1)
|
Newbuilding commitments relate to
eight
jack-up rigs totaling
$1.7 billion
,
one
semi-submersible rig totaling
$0.4 billion
and
four
drillships totaling
$1.9 billion
. Note that the newbuilding commitments include
$0.4 billion
related to the
Sevan Developer
that are presented as a contractual obligation in the balance sheet in the line item “Other short term liabilities.” Please see “
Note 33
– Commitments and contingencies” to our Consolidated Financial Statements included herein for further information.
|
G.
|
SAFE HARBOR
|
ITEM 6.
|
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|
A.
|
DIRECTORS AND SENIOR MANAGEMENT
|
Name
|
Age
|
Position
|
John Fredriksen
|
72
|
President, Director and Chairman of the Board
|
Kate Blankenship
|
51
|
Director and Audit Committee member
|
Kathrine Fredriksen
|
32
|
Director
|
Bert Bekker
|
77
|
Director
|
Paul Leand Jr.
|
49
|
Director
|
Ørjan Svanevik
|
50
|
Director
|
Hans Petter Aas
|
70
|
Director
|
Georgina Sousa
|
65
|
Director and Company Secretary
|
Per Wullf
|
56
|
Director, Chief Executive Officer and President, Seadrill Management
|
Mark Morris
|
52
|
Chief Financial Officer and Senior Vice President, Seadrill Management
|
David Sneddon
|
52
|
Chief Accounting Officer and Senior Vice President, Seadrill Management
|
Anton Dibowitz
|
43
|
Chief Commercial Officer and Senior Vice President, Seadrill Management
|
Leif Nelson
|
41
|
Chief Operating Officer and Senior Vice President
|
Henrik M Hansen
|
53
|
Chief Technical Officer and Senior Vice President
|
Svend Anton Maier
|
50
|
Senior Vice President Special Projects
|
José Firmo
|
45
|
Senior Vice President Brazil
|
Alf Ragnar Løvdal
|
58
|
Senior Vice President and CEO of North Atlantic Management
|
Ray Watkins
|
55
|
Senior Vice President Americas
|
Philip Souyris
|
46
|
Senior Vice President Mexico
|
Dave Morrow
|
44
|
Senior Vice President, Africa & Middle East
|
Alex Monsen
|
54
|
Senior Vice President Asia Pacific
|
Des Thurlby
|
51
|
Senior Vice President, Human Resources
|
B.
|
COMPENSATION
|
C.
|
BOARD PRACTICES
|
D.
|
EMPLOYEES
|
Total employees (including contracted-in staff )
|
December 31,
2015 |
|
|
December 31,
2014 |
|
|
December 31,
2013 |
|
Operating segments:
|
|
|
|
|
|
|||
Floaters
|
2,995
|
|
|
4,505
|
|
|
5,100
|
|
Jack-up rigs
|
2,075
|
|
|
2,985
|
|
|
2,650
|
|
Tender rigs
|
—
|
|
|
—
|
|
|
1,115
|
|
Other
|
1,755
|
|
|
1,850
|
|
|
—
|
|
Corporate
|
170
|
|
|
110
|
|
|
100
|
|
Total employees
|
6,995
|
|
|
9,450
|
|
|
8,965
|
|
Geographical location:
|
|
|
|
|
|
|
|
|
Norway
|
1,080
|
|
|
1,455
|
|
|
1,695
|
|
Rest of Europe
|
170
|
|
|
110
|
|
|
100
|
|
North America and Mexico
|
1,535
|
|
|
2,485
|
|
|
1,990
|
|
South America
|
1,145
|
|
|
1,155
|
|
|
1,015
|
|
Asia Pacific
|
575
|
|
|
1,130
|
|
|
1,355
|
|
Africa and Middle East
|
2,490
|
|
|
3,115
|
|
|
2,810
|
|
Total employees
|
6,995
|
|
|
9,450
|
|
|
8,965
|
|
E.
|
SHARE OWNERSHIP
|
Director or Key Employee
|
Beneficial Interest in
Common Shares of
$2.00 each
|
|
Interest in Options and Restricted Stock Units (RSUs)
|
||||||||||||||||
|
Number of shares
|
|
|
%
|
|
Scheme
|
|
|
Total number of options / Total number of units
|
|
|
Number of options vested
|
|
|
Exercise price
|
|
|
Expiry date/ Vesting date
|
|
John Fredriksen
(Note 2)
|
(Note 2)
|
|
|
(Note 2)
|
|
Options
|
|
|
180,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Kate Blankenship
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Kathrine Fredriksen
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Bert Bekker
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Paul Leand Jr.
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Ørjan Svanevik
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Hans Petter Aas
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
Georgina Sousa
|
—
|
|
|
(Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Per Wullf
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
60,000
|
|
|
45,000
|
|
|
NOK 138.49
|
|
|
November 2016
|
|
|
|
|
|
Options
|
|
|
130,000
|
|
|
65,000
|
|
|
NOK 249.13
|
|
|
November 2017
|
|
||
|
|
|
|
Options
|
|
|
180,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
||
|
|
|
|
RSUs
|
|
|
239,828
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Mark Morris
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
60,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
|
|
|
|
RSUs
|
|
|
17,726
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Director or Key Employee
|
Beneficial Interest in
Common Shares of
$2.00 each
|
|
Interest in Options and Restricted Stock Units (RSUs)
|
||||||||||||||||
|
Number of shares
|
|
|
%
|
|
Scheme
|
|
|
Total number of options / Total number of units
|
|
|
Number of options vested
|
|
|
Exercise price
|
|
|
Expiry date/ Vesting date
|
|
David Sneddon
|
—
|
|
|
(Note 1)
|
|
RSUs
|
|
|
15,000
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
|
|
|
|
RSUs
|
|
|
4,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
38,408
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Anton Dibowitz
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
35,000
|
|
|
26,250
|
|
|
NOK 202.05
|
|
|
December 2016
|
|
|
|
|
|
Options
|
|
|
60,000
|
|
|
30,000
|
|
|
NOK 273.00
|
|
|
December 2017
|
|
||
|
|
|
|
Options
|
|
|
80,000
|
|
|
—
|
|
|
NOK 93.70
|
|
|
May 2018
|
|
||
|
|
|
|
RSUs
|
|
|
98,168
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Henrik M. Hansen
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
30,000
|
|
|
22,500
|
|
|
NOK 138.49
|
|
|
November 2016
|
|
|
|
|
|
RSUs
|
|
|
6,000
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
||
|
|
|
|
RSUs
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
31,693
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Leif Nelson
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
20,000
|
|
|
15,000
|
|
|
NOK 202.05
|
|
|
November 2016
|
|
|
|
|
|
RSUs
|
|
|
6,000
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
||
|
|
|
|
RSUs
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
20,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
36,037
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Svend Anton Maier
|
—
|
|
|
(Note 1)
|
|
RSUs
|
|
|
4,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Jose Firmo
|
—
|
|
|
(Note 1)
|
|
RSUs
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
7,232
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Alf Ragnar Løvdal
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
45,000
|
|
|
30,000
|
|
|
NOK 202.05
|
|
|
December 2016
|
|
|
|
|
|
RSUs
(Note 3) |
|
|
7,185
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
||
|
|
|
|
RSUs
(Note 3) |
|
|
3,145
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
(Note 3) |
|
|
28,310
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Ray Watkins
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
20,000
|
|
|
15,000
|
|
|
NOK 202.05
|
|
|
December 2016
|
|
|
|
|
|
RSUs
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
||
|
|
|
|
RSUs
|
|
|
4,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
23,781
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
Director or Key Employee
|
Beneficial Interest in
Common Shares of
$2.00 each
|
|
Interest in Options and Restricted Stock Units (RSUs)
|
||||||||||||||||
|
Number of shares
|
|
|
%
|
|
Scheme
|
|
|
Total number of options / Total number of units
|
|
|
Number of options vested
|
|
|
Exercise price
|
|
|
Expiry date/ Vesting date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Philip Souyris
|
|
|
(Note 1)
|
|
RSUs
|
|
|
8,000
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
|
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
19,034
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Alex Monsen
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
40,000
|
|
|
30,000
|
|
|
NOK 202.05
|
|
|
November 2016
|
|
|
|
|
|
RSUs
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
||
|
|
|
|
RSUs
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
14,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Des Thurlby
|
—
|
|
|
(Note 1)
|
|
RSUs
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
|
|
|
|
RSUs
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
22,070
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dave Morrow
|
—
|
|
|
(Note 1)
|
|
Options
|
|
|
15,000
|
|
|
11,250
|
|
|
NOK 202.05
|
|
|
November 2016
|
|
|
|
|
|
Options
|
|
|
15,000
|
|
|
7,500
|
|
|
NOK 219.13
|
|
|
March 2017
|
|
||
|
|
|
|
RSUs
|
|
|
7,500
|
|
|
—
|
|
|
—
|
|
|
December 2016
|
|
||
|
|
|
|
RSUs
|
|
|
3,500
|
|
|
—
|
|
|
—
|
|
|
December 2017
|
|
||
|
|
|
|
RSUs
|
|
|
17,000
|
|
|
—
|
|
|
—
|
|
|
December 2018
|
|
||
|
|
|
|
RSUs
|
|
|
17,364
|
|
|
|
|
|
|
December 2018
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Less than
1%
|
(2)
|
Hemen Holding Limited, a Cyprus holding company, and other related companies are collectively referred to herein as Hemen. These shares are indirectly held in trusts established by Mr. John Fredriksen for the benefit of his immediate family. Mr. Fredriksen disclaims beneficial ownership of the
119,097,583
shares of our common stock held by Hemen, except to the extent of his voting and dispositive interest in such shares of common stock. Mr. Fredriksen has no pecuniary interest in the shares held by Hemen. In addition to the holdings of shares and options contained in the table above, as of
March 31, 2016
, Hemen is party to separate TRS agreements relating to
3,900,000
of our common shares.
|
(3)
|
These RSUs awarded to Alf Ragnar Løvdal are part of the NADL RSU plan.
|
ITEM 7.
|
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|
A.
|
MAJOR SHAREHOLDERS
|
|
Common Shares Held
|
||||
Shareholder
|
Number
|
|
|
%
|
|
Hemen
(1)
|
119,097,583
|
|
|
24.2
|
%
|
Tong Jinquan
(2)
|
35,437,289
|
|
|
7.2
|
%
|
(1)
|
For further information regarding Hemen, please see “Item 6. Directors, Senior Management and Employees–E. Share Ownership.”
|
(2)
|
This information was derived from Schedule 13G filed with the Commission on July 13, 2015, which in addition to Mr. Jinquan includes Wealthy Fountain Holdings Inc., Skyline Horizon Consortium Ltd, Starray Global Limited and Shanghai Summit Pte Ltd as beneficial owners.
|
B.
|
RELATED PARTY TRANSACTIONS
|
•
|
Transactions with investees and associates, over which the Company has significant influence:
|
◦
|
Seadrill Partners
|
◦
|
Archer
|
◦
|
SeaMex
|
◦
|
Seabras Sapura
|
•
|
Transactions with those holding significant influence over the Company:
|
◦
|
Hemen and affiliated companies
|
•
|
a non-competition agreement with Seadrill Partners for any drilling rig operating under a contract for five or more years;
|
•
|
rights of first offer on any proposed sale, transfer or other disposition of drilling rigs;
|
•
|
rights of first offer on any proposed transfer, assignment, sale or other disposition of any equity interests in OPCO;
|
•
|
indemnification—Seadrill has agreed to indemnify Seadrill Partners against certain environmental and toxic tort liabilities with respect to the assets contributed or sold to Seadrill Partners, and also certain tax liabilities;
|
•
|
Ship Finance International Limited (“Ship Finance”);
|
•
|
Metrogas Holdings Inc (“Metrogas”);
|
•
|
Archer Limited (“Archer”);
|
•
|
Frontline Management (Bermuda) Limited (“Frontline”); and
|
•
|
Seatankers Management Norway AS (“Seatankers”).
|
•
|
an immediate non-cash cancellation of the total commitment under the MRCFA from
$750 million
to
$687.5 million
;
|
•
|
relaxation of certain financial covenants on the bank loan until June 30, 2016; and
|
•
|
a further repayment and cancellation of the commitment under the MRCFA from
$687.5 million
to
$625 million
by April 30, 2016.
|
C.
|
INTEREST OF EXPERTS AND COUNSEL
|
ITEM 8.
|
FINANCIAL INFORMATION
|
A.
|
CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION
|
Payment date
|
Amount per share
|
|
|
|
|
||
2014
|
|
||
March 20, 2014
|
$
|
0.98
|
|
June 19, 2014
|
$
|
1.00
|
|
September 18, 2014
|
$
|
1.00
|
|
|
|
||
2013
|
|
||
June 20, 2013
|
$
|
0.88
|
|
September 20, 2013
|
$
|
0.91
|
|
December 20, 2013
|
$
|
0.95
|
|
B.
|
SIGNIFICANT CHANGES
|
ITEM 9.
|
THE OFFER AND LISTING
|
A.
|
OFFER AND LISTING DETAILS
|
|
NYSE
|
|
OSE
|
||||||||
|
High
(US$)
|
|
|
Low
(US$)
|
|
|
High
(NOK)
|
|
|
Low
(NOK)
|
|
Fiscal year ended December 31
|
|
|
|
|
|
|
|
||||
2015
|
15.44
|
|
|
3.31
|
|
|
115.80
|
|
|
30.55
|
|
2014
|
40.84
|
|
|
10.66
|
|
|
250.00
|
|
|
80.65
|
|
2013
|
47.78
|
|
|
34.75
|
|
|
289.00
|
|
|
202.00
|
|
2012
|
42.07
|
|
|
32.07
|
|
|
244.20
|
|
|
192.90
|
|
2011
|
38.24
|
|
|
25.88
|
|
|
215.00
|
|
|
148.00
|
|
|
NYSE
|
|
OSE
|
||||||||
|
High
(US$)
|
|
|
Low
(US$)
|
|
|
High
(NOK)
|
|
|
Low
(NOK)
|
|
First quarter ended March 31, 2016
|
7.49
|
|
|
1.57
|
|
|
49.00
|
|
|
13.29
|
|
|
|
|
|
|
|
|
|
||||
Fiscal year ended December 31, 2015
|
|
|
|
|
|
|
|
||||
First quarter 2015
|
14.49
|
|
|
8.58
|
|
|
108.60
|
|
|
70.50
|
|
Second quarter 2015
|
15.44
|
|
|
9.30
|
|
|
115.80
|
|
|
74.30
|
|
Third quarter 2015
|
10.39
|
|
|
5.60
|
|
|
83.55
|
|
|
47.40
|
|
Fourth quarter 2015
|
7.93
|
|
|
3.31
|
|
|
64.85
|
|
|
30.55
|
|
|
|
|
|
|
|
|
|
||||
Fiscal year ended December 31, 2014
|
|
|
|
|
|
|
|
||||
First quarter 2014
|
40.84
|
|
|
32.93
|
|
|
250.00
|
|
|
197.50
|
|
Second quarter 2014
|
40.37
|
|
|
32.75
|
|
|
246.50
|
|
|
195.60
|
|
Third quarter 2014
|
40.22
|
|
|
26.58
|
|
|
248.30
|
|
|
172.30
|
|
Fourth quarter 2014
|
25.47
|
|
|
10.66
|
|
|
170.60
|
|
|
80.65
|
|
|
NYSE
|
|
OSE
|
||||||||
|
High
(US$)
|
|
|
Low
(US$)
|
|
|
High
(NOK)
|
|
|
Low
(NOK)
|
|
October 2015
|
7.93
|
|
|
5.80
|
|
|
64.85
|
|
|
48.56
|
|
November 2015
|
7.27
|
|
|
5.90
|
|
|
62.30
|
|
|
51.35
|
|
December 2015
|
6.13
|
|
|
3.31
|
|
|
52.90
|
|
|
30.55
|
|
January 2016
|
3.55
|
|
|
1.60
|
|
|
31.92
|
|
|
14.25
|
|
February 2016
|
2.25
|
|
|
1.57
|
|
|
19.55
|
|
|
13.29
|
|
March 2016
|
7.49
|
|
|
2.11
|
|
|
49.00
|
|
|
18.40
|
|
April 27, 2016 *
|
4.45
|
|
|
2.85
|
|
|
36.50
|
|
|
23.76
|
|
B.
|
PLAN OF DISTRIBUTION
|
C.
|
MARKETS
|
D.
|
SELLING SHAREHOLDERS
|
E.
|
DILUTION
|
F.
|
EXPENSES OF THE ISSUE
|
ITEM 10.
|
ADDITIONAL INFORMATION
|
A.
|
SHARE CAPITAL
|
B.
|
MEMORANDUM OF ASSOCIATION AND BYE-LAWS
|
•
|
If he becomes of unsound mind or a patient for any purpose of any statute or applicable law relating to mental health and the Board resolves that he shall be removed from office;
|
•
|
If he becomes bankrupt or compounds with his creditors;
|
•
|
If he is prohibited by law from being a Director; or
|
•
|
If he ceases to be a Director by virtue of the Companies Act (as defined in the Company’s Bye-laws.
|
•
|
we will not be able to pay our liabilities as they fall due; or
|
•
|
the realizable value of our assets is less than our liabilities.
|
C.
|
MATERIAL CONTRACTS
|
D.
|
EXCHANGE CONTROLS
|
E.
|
TAXATION
|
•
|
at least
75%
of the corporation’s gross income for such taxable year consists of passive income (e.g. dividends, interest, capital gains and rents derived other than in the active conduct of a rental business); or
|
•
|
at least
50%
of the average value of the assets held by the corporation during such taxable year produce, or are held for the production of, passive income.
|
•
|
the excess distribution or gain would be allocated ratably over the Non-Electing Holders’ aggregate holding period for the common stock;
|
•
|
the amount allocated to the current taxable year and any taxable year before we became a PFIC would be taxed as ordinary income; and
|
•
|
the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year.
|
•
|
the gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business in the United States. If the Non-U.S. Holder is entitled to the benefits of a United States income tax treaty with respect to that gain, that gain is subject to United States federal Income tax only if it is attributable to a permanent establishment maintained by the Non-U.S. Holder in the United States; or
|
•
|
the Non-U.S. Holder is an individual who is present in the United States for 183 days or more during the taxable year of disposition and other conditions are met.
|
•
|
fails to provide an accurate taxpayer identification number;
|
•
|
is notified by the IRS that he has failed to report all interest or dividends required to be shown on his United States federal income tax returns; or
|
•
|
in certain circumstances, fails to comply with applicable certification requirements.
|
F.
|
DIVIDENDS AND PAYING AGENTS
|
G.
|
STATEMENT BY EXPERTS
|
H.
|
DOCUMENTS ON DISPLAY
|
I.
|
SUBSIDIARY INFORMATION
|
ITEM 11.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Interest rate swaps - not qualified for hedge accounting
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In millions of U.S. dollars)
|
Outstanding principal
|
|
|
Fair value
|
|
|
Outstanding principal
|
|
|
Fair Value
|
|
Other non-current assets (current liabilities)
|
7,088
|
|
|
(122
|
)
|
|
7,918
|
|
|
(134
|
)
|
Interest rate swaps - qualified for hedge accounting
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In millions of U.S. dollars)
|
Outstanding principal
|
|
|
Fair value
|
|
|
Outstanding principal
|
|
|
Fair Value
|
|
Other non-current assets (non-current liabilities)
|
200
|
|
|
(2
|
)
|
|
224
|
|
|
(3
|
)
|
Cross currency interest rate swaps
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In millions of U.S. dollars)
|
Outstanding principal
|
|
|
Fair value
|
|
|
Outstanding principal
|
|
|
Fair Value
|
|
Other current liabilities
|
807
|
|
|
(291
|
)
|
|
807
|
|
|
(201
|
)
|
•
|
the measurement of debt and other monetary assets and liabilities denominated in foreign currencies converted into U.S. dollars, with the resulting gain or loss recorded as “Other financial items”;
|
•
|
changes in the fair value of foreign currency forward contracts, which are recorded as “Other financial items”;
|
•
|
the impact of fluctuations in exchange rates on the reported amounts of our revenues and expenses that are contracted in foreign currencies; and
|
•
|
foreign subsidiaries whose accounts are not maintained in U.S. dollars, which when converted into U.S. dollars can result in exchange adjustments that are recorded as a component in shareholders’ equity.
|
Foreign currency forward contracts - NOK
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In millions of U.S. dollars)
|
Notional Amount
|
|
|
Fair value
|
|
|
Notional Amount
|
|
|
Fair Value
|
|
Other current liabilities
|
—
|
|
|
—
|
|
|
260
|
|
|
(24
|
)
|
Foreign currency forward contracts - GBP
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In millions of U.S. dollars)
|
Notional Amount
|
|
|
Fair value
|
|
|
Notional Amount
|
|
|
Fair Value
|
|
Other current liabilities
|
—
|
|
|
—
|
|
|
49
|
|
|
(3
|
)
|
•
|
a
39.9%
equity interest in Archer (OSE:ARCHER), a Bermuda oil service company;
|
•
|
a
8.2%
equity interest in SapuraKencana (BURSA: SKPETRO), a Malaysian oil services company;
|
•
|
a
50%
equity interest in Seabras Participacoes SA, a Brazilian holding company, which owns the vessel-owning company of one pipe-laying vessel currently under construction;
|
•
|
a
50%
equity interest in Seabras Sapura Holding GmbH, an Austria holding company, which owns the vessel-owning entities of five pipe-laying vessels currently under construction;
|
•
|
a
30%
equity interest in Itaunas, a Holland vessel-owning company of one drillship currently under construction;
|
•
|
a
30%
equity interest in Camburi, a Holland vessel-owning company of one drillship currently under construction;
|
•
|
a
30%
equity interest in Sahy, a Holland vessel-owning company of one drillship currently under construction;
|
•
|
a
46.6%
equity interest in Seadrill Partners, which included our ownership interest in both its common and subordinated units;
|
•
|
direct ownership interests in the following entities controlled by Seadrill Partners:
|
•
|
a
50%
equity interest in SeaMex Limited, a joint venture in Mexico.
|
ITEM 12.
|
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|
A.
|
DEBT SECURITIES
|
B.
|
WARRANTS AND RIGHTS
|
C.
|
OTHER SECURITIES
|
D.
|
AMERICAN DEPOSITORY SHARES
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of the company’s management and directors; and
|
•
|
provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|
(
in U.S. dollars)
|
2015
|
|
|
2014
|
|
Audit fees
(1)
|
4,300,673
|
|
|
5,781,969
|
|
Audit-related fees
(2)
|
—
|
|
|
—
|
|
Taxation fees
(3)
|
12,000
|
|
|
24,565
|
|
All other fees
(4)
|
35,493
|
|
|
550,934
|
|
Total
|
4,348,166
|
|
|
6,357,468
|
|
•
|
Independence of Directors.
The NYSE
requires that a U.S. listed company maintain a majority of independent directors. As permitted under Bermuda law and our bye-laws,
four
members of our Board (Mrs. Kate Blankenship, Mr. Hans Petter Aas, Mr. Paul Leand Jr. and Mr. Bert Bekker) are independent according to the NYSE’s standards for independence applicable to a foreign private issuer.
|
•
|
Executive Sessions.
The NYSE
requires that non-management directors meet regularly in executive sessions without management. The NYSE
also requires that all independent directors meet in an executive session at least once a year. As permitted under Bermuda law and our bye-laws, our non-management directors do not regularly hold executive sessions without management and we do not expect them to do so in the future.
|
•
|
Nominating/Corporate Governance Committee
. The NYSE
requires that a listed U.S. company have a nominating/corporate governance committee of independent directors and a committee charter specifying the purpose, duties and evaluation procedures of the committee. As permitted under Bermuda law and our bye-laws, we do not currently have a nominating or corporate governance committee.
|
•
|
Audit Committee
. The NYSE
requires, among other things, that a listed U.S. company have an audit committee with a minimum of three members, all of whom are independent. As permitted by Rule 10A-3 under the Exchange Act, our audit committee consists of one independent member of our Board, Mrs. Kate Blankenship.
|
•
|
Corporate Governance Guidelines
. The NYSE
requires that a listed U.S. company adopt and disclose corporate governance guidelines. The guidelines must address, among other things, director qualification standards, director responsibilities, director access to management and independent advisers, director compensation, director orientation and continuing education, management succession and an annual performance evaluation. We are not required to adopt such guidelines under Bermuda law and we have not adopted such guidelines.
|
The following financial statements listed below and set forth on pages F-1 through
|
are filed as part of this Annual Report on Form
|
|
20-F.
|
|
|
Consolidated Financial Statements of Seadrill Limited
|
|
(1)
|
Incorporated by reference to the Company’s registration statement on Form 20-F, filed on March 18, 2010
|
(2)
|
Incorporated by reference to the Company’s annual report on Form 20-F, filed on May 5, 2010
|
(3)
|
Incorporated by reference to the Company’s annual report on Form 20-F, filed on April 23, 2014
|
(4)
|
Incorporated by reference to Amendment No. 1 to the Company’s annual report on Form 20-F, filed on May 5, 2014
|
(5)
|
Incorporated by reference to the Company’s annual report on Form 20-F, filed on April 21, 2015
|
†
|
Certain portions have been omitted pursuant to a confidential treatment request. Omitted information has been filed separately with the Commission.
|
|
By:
|
/s/ Per Wullf
|
|
Name:
|
Per Wullf
|
|
Title:
|
Chief Executive Officer of Seadrill Management Ltd
(Principal Executive Officer of Seadrill Limited)
|
Consolidated Financial Statements of Seadrill Limited
|
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Operating revenues
|
|
|
|
|
|
|
|||
Contract revenues
|
|
3,957
|
|
|
4,518
|
|
|
4,892
|
|
Reimbursable revenues
|
|
113
|
|
|
190
|
|
|
278
|
|
Other revenues
|
*
|
265
|
|
|
289
|
|
|
112
|
|
Total operating revenues
|
|
4,335
|
|
|
4,997
|
|
|
5,282
|
|
|
|
|
|
|
|
|
|||
(Loss)/gain on disposals
|
*
|
(63
|
)
|
|
632
|
|
|
61
|
|
Contingent consideration realized
|
*
|
47
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|||
Operating expenses
|
|
|
|
|
|
|
|||
Vessel and rig operating expenses
|
*
|
1,611
|
|
|
1,938
|
|
|
1,977
|
|
Reimbursable expenses
|
|
99
|
|
|
172
|
|
|
257
|
|
Depreciation and amortization
|
|
779
|
|
|
693
|
|
|
711
|
|
Loss on Goodwill impairment
|
|
563
|
|
|
232
|
|
|
—
|
|
General and administrative expenses
|
*
|
248
|
|
|
315
|
|
|
300
|
|
Total operating expenses
|
|
3,300
|
|
|
3,350
|
|
|
3,245
|
|
|
|
|
|
|
|
|
|||
Operating income
|
|
1,019
|
|
|
2,279
|
|
|
2,098
|
|
|
|
|
|
|
|
|
|||
Financial items and other income/(expense), net
|
|
|
|
|
|
|
|
||
Interest income
|
*
|
67
|
|
|
63
|
|
|
24
|
|
Interest expense
|
*
|
(415
|
)
|
|
(478
|
)
|
|
(445
|
)
|
Share in results from associated companies (net of tax)
|
|
190
|
|
|
34
|
|
|
(223
|
)
|
Loss on impairment of investments
|
|
(1,274
|
)
|
|
—
|
|
|
—
|
|
(Loss)/gain on derivative financial instruments
|
*
|
(274
|
)
|
|
(497
|
)
|
|
133
|
|
Net gain/(loss) on debt extinguishment
|
|
8
|
|
|
(54
|
)
|
|
—
|
|
Foreign exchange gain
|
|
63
|
|
|
164
|
|
|
52
|
|
Gain on realization of marketable securities
|
|
—
|
|
|
131
|
|
|
—
|
|
Gain on deconsolidation of Seadrill Partners
|
|
—
|
|
|
2,339
|
|
|
—
|
|
Gain on sale of tender rig business
|
|
22
|
|
|
—
|
|
|
1,256
|
|
Other financial items and other income/(expense), net
|
*
|
52
|
|
|
125
|
|
|
45
|
|
Total financial items and other income/(expense), net
|
|
(1,561
|
)
|
|
1,827
|
|
|
842
|
|
|
|
|
|
|
|
|
|||
(Loss)/income before income taxes
|
|
(542
|
)
|
|
4,106
|
|
|
2,940
|
|
|
|
|
|
|
|
|
|||
Income tax expense
|
|
(208
|
)
|
|
(19
|
)
|
|
(154
|
)
|
Net (loss)/income
|
|
(750
|
)
|
|
4,087
|
|
|
2,786
|
|
|
|
|
|
|
|
|
|||
Net (loss)/income attributable to the non-controlling interest
|
|
(12
|
)
|
|
108
|
|
|
133
|
|
Net (loss)/income attributable to the parent
|
|
(738
|
)
|
|
3,979
|
|
|
2,653
|
|
|
|
|
|
|
|
|
|||
Basic (loss)/earnings per share (U.S. dollar)
|
|
(1.49
|
)
|
|
8.32
|
|
|
5.66
|
|
Diluted (loss)/earnings per share (U.S. dollar)
|
|
(1.49
|
)
|
|
8.30
|
|
|
5.47
|
|
Declared regular dividend per share (U.S. dollar)
|
|
—
|
|
|
2.00
|
|
|
3.72
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|||
Net (loss)/income
|
(750
|
)
|
|
4,087
|
|
|
2,786
|
|
|
|
|
|
|
|
|||
Other comprehensive income/(loss), net of tax:
|
|
|
|
|
|
|
|
|
Change in unrealized (loss)/gain on marketable securities, net
|
(427
|
)
|
|
(982
|
)
|
|
333
|
|
Other than temporary impairment of marketable securities,
reclassification to statement of operations
|
741
|
|
|
—
|
|
|
—
|
|
Change in unrealized foreign exchange differences
|
(15
|
)
|
|
(22
|
)
|
|
6
|
|
Change in actuarial gain/(loss) relating to pension
|
27
|
|
|
(28
|
)
|
|
(7
|
)
|
Change in unrealized gain on interest rate swaps in VIEs and subsidiaries
|
—
|
|
|
1
|
|
|
3
|
|
Share of other comprehensive income from associated
companies
|
10
|
|
|
—
|
|
|
—
|
|
Other comprehensive income/(loss):
|
336
|
|
|
(1,031
|
)
|
|
335
|
|
|
|
|
|
|
|
|||
Total comprehensive (loss)/income for the period
|
(414
|
)
|
|
3,056
|
|
|
3,121
|
|
|
|
|
|
|
|
|||
Comprehensive (loss)/income attributable to the non-controlling interest
|
(4
|
)
|
|
53
|
|
|
134
|
|
Comprehensive (loss)/income attributable to the parent
|
(410
|
)
|
|
3,003
|
|
|
2,987
|
|
|
2015
|
|
|
2014
|
|
ASSETS
|
|
|
|
||
Current assets
|
|
|
|
||
Cash and cash equivalents
|
1,044
|
|
|
831
|
|
Restricted cash
|
50
|
|
|
268
|
|
Marketable securities
|
96
|
|
|
426
|
|
Accounts receivables, net
|
718
|
|
|
1,017
|
|
Amount due from related party - current
|
639
|
|
|
402
|
|
Assets held for sale - current
|
—
|
|
|
134
|
|
Other current assets
|
395
|
|
|
222
|
|
Total current assets
|
2,942
|
|
|
3,300
|
|
|
|
|
|
||
Non-current assets
|
|
|
|
||
Investment in associated companies
|
2,590
|
|
|
2,898
|
|
Marketable securities
|
228
|
|
|
325
|
|
Newbuildings
|
1,479
|
|
|
2,030
|
|
Drilling units
|
14,930
|
|
|
15,145
|
|
Goodwill
|
—
|
|
|
604
|
|
Restricted cash
|
198
|
|
|
181
|
|
Deferred tax assets
|
81
|
|
|
39
|
|
Equipment
|
46
|
|
|
46
|
|
Amount due from related party - non-current
|
517
|
|
|
313
|
|
Assets held for sale - non-current
|
128
|
|
|
1,105
|
|
Other non-current assets
|
331
|
|
|
311
|
|
Total non-current assets
|
20,528
|
|
|
22,997
|
|
Total assets
|
23,470
|
|
|
26,297
|
|
|
|
|
|
||
LIABILITIES AND EQUITY
|
|
|
|
||
Current liabilities
|
|
|
|
||
Current portion of long-term debt
|
1,489
|
|
|
2,267
|
|
Trade accounts payable
|
141
|
|
|
84
|
|
Short-term amounts to related party
|
152
|
|
|
189
|
|
Liabilities associated with assets held for sale - current
|
—
|
|
|
58
|
|
Other current liabilities
|
1,684
|
|
|
1,934
|
|
Total current liabilities
|
3,466
|
|
|
4,532
|
|
|
|
|
|
||
Non-current liabilities
|
|
|
|
||
Long-term debt
|
9,054
|
|
|
10,208
|
|
Long-term debt due to related parties
|
438
|
|
|
351
|
|
Deferred tax liabilities
|
136
|
|
|
67
|
|
Liabilities associated with assets held for sale - non-current
|
—
|
|
|
50
|
|
Other non-current liabilities
|
401
|
|
|
699
|
|
Total non-current liabilities
|
10,029
|
|
|
11,375
|
|
|
|
|
|
||
Commitments and contingencies
(see note 33)
|
—
|
|
|
—
|
|
Equity
|
2015
|
|
|
2014
|
|
Common shares of par value US$2.00 per share: 800,000,000 shares authorized 492,759,940 outstanding at December 31, 2015 (December 31, 2014, 492,759,938)
|
985
|
|
|
985
|
|
Additional paid in capital
|
3,275
|
|
|
3,258
|
|
Contributed surplus
|
1,956
|
|
|
1,956
|
|
Accumulated other comprehensive loss
|
(120
|
)
|
|
(448
|
)
|
Retained earnings
|
3,275
|
|
|
4,013
|
|
Total Shareholder’s equity
|
9,371
|
|
|
9,764
|
|
Non-controlling interest
|
604
|
|
|
626
|
|
Total equity
|
9,975
|
|
|
10,390
|
|
Total liabilities and equity
|
23,470
|
|
|
26,297
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Cash Flows from Operating Activities
|
|
|
|
|
|
|||
Net (loss)/income
|
(750
|
)
|
|
4,087
|
|
|
2,786
|
|
Adjustments to reconcile net (loss)/income to net cash provided by operating activities:
|
|
|
|
|
|
|||
Depreciation and amortization
|
779
|
|
|
693
|
|
|
711
|
|
Amortization of deferred loan charges
|
39
|
|
|
54
|
|
|
43
|
|
Amortization of unfavorable and favorable contracts
|
(116
|
)
|
|
(131
|
)
|
|
(65
|
)
|
Share of results from associated companies
|
(190
|
)
|
|
(121
|
)
|
|
223
|
|
Loss on sale of investments in associated companies
|
—
|
|
|
89
|
|
|
—
|
|
Share-based compensation expense
|
7
|
|
|
10
|
|
|
7
|
|
Gain/(loss) on disposals and deconsolidations
|
63
|
|
|
(2,971
|
)
|
|
(1,367
|
)
|
Contingent consideration realized
|
(47
|
)
|
|
—
|
|
|
—
|
|
Unrealized loss/(gain) related to derivative financial instruments
|
42
|
|
|
197
|
|
|
(249
|
)
|
Loss on Goodwill impairment
|
563
|
|
|
232
|
|
|
—
|
|
Loss on impairment of investments
|
1,274
|
|
|
—
|
|
|
—
|
|
Gain on realization of marketable securities
|
—
|
|
|
(138
|
)
|
|
—
|
|
Dividends received from associated companies
|
253
|
|
|
526
|
|
|
15
|
|
Deferred income tax
|
29
|
|
|
(6
|
)
|
|
(47
|
)
|
Unrealized foreign exchange gain on long-term debt
|
(95
|
)
|
|
(165
|
)
|
|
(47
|
)
|
Payments for long-term maintenance
|
(106
|
)
|
|
(295
|
)
|
|
(190
|
)
|
Net gain on debt extinguishment
|
(8
|
)
|
|
(12
|
)
|
|
—
|
|
Other
|
(31
|
)
|
|
(17
|
)
|
|
—
|
|
Changes in operating assets and liabilities, net of effect of acquisitions and disposals
|
|
|
|
|
|
|||
Trade accounts receivable
|
267
|
|
|
(295
|
)
|
|
(206
|
)
|
Trade accounts payable
|
58
|
|
|
21
|
|
|
(29
|
)
|
Net related party balances
|
1
|
|
|
(247
|
)
|
|
(114
|
)
|
Prepaid expenses/accrued revenue
|
(12
|
)
|
|
13
|
|
|
(45
|
)
|
Deferred revenue
|
(95
|
)
|
|
171
|
|
|
90
|
|
Other assets and liabilities, net
|
(137
|
)
|
|
(121
|
)
|
|
179
|
|
Net cash provided by operating activities
|
1,788
|
|
|
1,574
|
|
|
1,695
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Cash Flows from Investing Activities
|
|
|
|
|
|
|||
Additions to newbuildings
|
(613
|
)
|
|
(2,508
|
)
|
|
(3,884
|
)
|
Additions to drilling units and equipment
|
(322
|
)
|
|
(365
|
)
|
|
(389
|
)
|
Refund of yard installments
|
29
|
|
|
—
|
|
|
—
|
|
Contingent consideration received
|
27
|
|
|
—
|
|
|
—
|
|
Sale of rigs and equipment
|
—
|
|
|
—
|
|
|
48
|
|
Business combinations and step acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
(554
|
)
|
Sale of business, net of cash disposed
|
1,214
|
|
|
1,138
|
|
|
1,958
|
|
Cash in deconsolidated subsidiary
|
—
|
|
|
(90
|
)
|
|
—
|
|
Change in restricted cash
|
(25
|
)
|
|
(131
|
)
|
|
123
|
|
Investment in associated companies
|
(210
|
)
|
|
(586
|
)
|
|
(151
|
)
|
Proceeds from disposal of investments in associated companies
|
—
|
|
|
373
|
|
|
—
|
|
Purchase of marketable securities
|
—
|
|
|
(150
|
)
|
|
—
|
|
Loans granted to related parties
|
(523
|
)
|
|
(18
|
)
|
|
(125
|
)
|
Payments received from loans granted to related parties
|
233
|
|
|
2,096
|
|
|
10
|
|
Proceeds from disposal of marketable securities
|
—
|
|
|
307
|
|
|
—
|
|
Net cash (used in)/provided by investing activities
|
(190
|
)
|
|
66
|
|
|
(2,964
|
)
|
|
|
|
|
|
|
|||
Cash Flows from Financing Activities
|
|
|
|
|
|
|||
Proceeds from debt
|
1,516
|
|
|
5,072
|
|
|
7,703
|
|
Repayments of debt
|
(2,999
|
)
|
|
(4,344
|
)
|
|
(4,919
|
)
|
Debt fees paid
|
(16
|
)
|
|
(65
|
)
|
|
(93
|
)
|
Proceeds from debt to related party
|
143
|
|
|
90
|
|
|
756
|
|
Repayments of debt to related party
|
—
|
|
|
(910
|
)
|
|
(1,181
|
)
|
Dividends paid to non-controlling interests
|
(14
|
)
|
|
(51
|
)
|
|
(69
|
)
|
Contribution from non-controlling interests, net of issuance cost
|
—
|
|
|
115
|
|
|
365
|
|
Proceeds relating to share forward contracts and other derivatives
|
—
|
|
|
—
|
|
|
453
|
|
Purchase of treasury shares
|
—
|
|
|
(18
|
)
|
|
(39
|
)
|
Proceeds from sale of treasury shares
|
—
|
|
|
—
|
|
|
6
|
|
Dividends paid
|
—
|
|
|
(1,415
|
)
|
|
(1,287
|
)
|
Employee stock options exercised
|
—
|
|
|
5
|
|
|
—
|
|
Net cash (used in)/provided by financing activities
|
(1,370
|
)
|
|
(1,521
|
)
|
|
1,695
|
|
|
|
|
|
|
|
|||
Cash reclassified as held for sale
|
—
|
|
|
(26
|
)
|
|
—
|
|
Effect of exchange rate changes on cash and cash equivalents
|
(15
|
)
|
|
(6
|
)
|
|
—
|
|
|
|
|
|
|
|
|||
Net increase in cash and cash equivalents
|
213
|
|
|
87
|
|
|
426
|
|
Cash and cash equivalents at beginning of the year
|
831
|
|
|
744
|
|
|
318
|
|
Cash and cash equivalents at the end of year
|
1,044
|
|
|
831
|
|
|
744
|
|
|
|
|
|
|
|
|||
Supplementary disclosure of cash flow information
|
|
|
|
|
|
|||
Interest paid, net of capitalized interest
|
(458
|
)
|
|
(493
|
)
|
|
(336
|
)
|
Taxes paid
|
(136
|
)
|
|
(227
|
)
|
|
(109
|
)
|
|
|
Common shares
|
|
|
Additional paid in capital
|
|
|
Contributed surplus
|
|
|
Accumulated other comprehensive (loss)/income
|
|
|
Retained Earnings
|
|
|
Total equity before NCI
|
|
|
Non-controlling interest
|
|
|
Total equity
|
|
Balance at December 31, 2012
|
|
938
|
|
|
2,332
|
|
|
1,956
|
|
|
194
|
|
|
83
|
|
|
5,503
|
|
|
521
|
|
|
6,024
|
|
Sale of treasury shares
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
Purchase of treasury shares
|
|
—
|
|
|
(39
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(39
|
)
|
|
—
|
|
|
(39
|
)
|
Share-based compensation
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
Establishment of non-controlling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
297
|
|
|
297
|
|
Issuance of common units by Seadrill Partners to public
|
|
—
|
|
|
228
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
228
|
|
|
137
|
|
|
365
|
|
Issuances of common units by Seadrill Partners and impact on non-controlling interest
|
|
—
|
|
|
(102
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(102
|
)
|
|
102
|
|
|
—
|
|
Sale of drilling units to Seadrill Partners
|
|
—
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
209
|
|
|
(209
|
)
|
|
—
|
|
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
334
|
|
|
—
|
|
|
334
|
|
|
1
|
|
|
335
|
|
Dividends declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,287
|
)
|
|
(1,287
|
)
|
|
(69
|
)
|
|
(1,356
|
)
|
Dividend to Non-controlling interests in VIEs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(223
|
)
|
|
(223
|
)
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,653
|
|
|
2,653
|
|
|
133
|
|
|
2,786
|
|
Balance at December 31, 2013
|
|
938
|
|
|
2,641
|
|
|
1,956
|
|
|
528
|
|
|
1,449
|
|
|
7,512
|
|
|
690
|
|
|
8,202
|
|
Sale and purchase of treasury shares, net
|
|
(1
|
)
|
|
(22
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|
—
|
|
|
(23
|
)
|
Share-based compensation charge
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
10
|
|
Employee stock options issued
|
|
1
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
Conversion of convertible bond
|
|
47
|
|
|
568
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
615
|
|
|
—
|
|
|
615
|
|
Deconsolidation of Seadrill Partners
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(115
|
)
|
|
(115
|
)
|
Initial public offering of NADL
|
|
—
|
|
|
63
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63
|
|
|
52
|
|
|
115
|
|
Acquisition of West Polaris
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(7
|
)
|
|
(13
|
)
|
Sale of NCI
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(976
|
)
|
|
—
|
|
|
(976
|
)
|
|
(55
|
)
|
|
(1,031
|
)
|
Dividends declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,415
|
)
|
|
(1,415
|
)
|
|
(51
|
)
|
|
(1,466
|
)
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,979
|
|
|
3,979
|
|
|
108
|
|
|
4,087
|
|
Balance at December 31, 2014
|
|
985
|
|
|
3,258
|
|
|
1,956
|
|
|
(448
|
)
|
|
4,013
|
|
|
9,764
|
|
|
626
|
|
|
10,390
|
|
Sale and purchase of treasury shares, net
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
10
|
|
Share-based compensation charge
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
Sale of NCI
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
328
|
|
|
—
|
|
|
328
|
|
|
8
|
|
|
336
|
|
Distributions to Non-controlling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
(14
|
)
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(738
|
)
|
|
(738
|
)
|
|
(12
|
)
|
|
(750
|
)
|
Balance at December 31, 2015
|
|
985
|
|
|
3,275
|
|
|
1,956
|
|
|
(120
|
)
|
|
3,275
|
|
|
9,371
|
|
|
604
|
|
|
9,975
|
|
•
|
Floaters: Services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contracts relate to semi-submersible rigs and drillships for harsh and benign environments in mid-, deep- and ultra-deep waters.
|
•
|
Jack-up rigs: Services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contracts relate to jack-up rigs for operations in harsh and benign environment.
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Floaters
|
2,906
|
|
|
3,360
|
|
|
3,698
|
|
Jack-up rigs
|
1,293
|
|
|
1,478
|
|
|
1,175
|
|
Tender Rigs
|
—
|
|
|
—
|
|
|
382
|
|
Other
|
136
|
|
|
159
|
|
|
27
|
|
Total
|
4,335
|
|
|
4,997
|
|
|
5,282
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Floaters
|
340
|
|
|
1,992
|
|
|
1,472
|
|
Jack-up Rigs
|
664
|
|
|
275
|
|
|
450
|
|
Tender Rigs
|
—
|
|
|
—
|
|
|
176
|
|
Other
|
15
|
|
|
12
|
|
|
—
|
|
Operating income
|
1,019
|
|
|
2,279
|
|
|
2,098
|
|
Unallocated items:
|
|
|
|
|
|
|
|
|
Total financial items and other
|
(1,561
|
)
|
|
1,827
|
|
|
842
|
|
Income tax expense
|
(208
|
)
|
|
(19
|
)
|
|
(154
|
)
|
Net income
|
(750
|
)
|
|
4,087
|
|
|
2,786
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
Floaters
|
12,189
|
|
|
12,849
|
|
Jack-up Rigs
|
4,220
|
|
|
4,326
|
|
Tender Rigs
|
—
|
|
|
—
|
|
Total Drilling Units and Newbuildings
|
16,409
|
|
|
17,175
|
|
Assets held for sale
|
128
|
|
|
1,239
|
|
Investments in Associated companies
|
2,590
|
|
|
2,898
|
|
Marketable securities
|
324
|
|
|
751
|
|
Goodwill
|
—
|
|
|
604
|
|
Cash and restricted cash
|
1,292
|
|
|
1,280
|
|
Other assets
|
2,727
|
|
|
2,350
|
|
Total
|
23,470
|
|
|
26,297
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
Floaters
|
—
|
|
|
604
|
|
Total
|
—
|
|
|
604
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Floaters
|
950
|
|
|
2,327
|
|
|
3,178
|
|
Jack-up Rigs
|
95
|
|
|
776
|
|
|
1,371
|
|
Tender Rigs
|
—
|
|
|
—
|
|
|
150
|
|
Total
|
1,045
|
|
|
3,103
|
|
|
4,699
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Brazil
|
877
|
|
|
991
|
|
|
825
|
|
Norway
|
641
|
|
|
1,071
|
|
|
1,198
|
|
Angola
|
527
|
|
|
707
|
|
|
734
|
|
Nigeria
|
499
|
|
|
21
|
|
|
207
|
|
Others *
|
1,791
|
|
|
2,207
|
|
|
2,318
|
|
Total Revenue
|
4,335
|
|
|
4,997
|
|
|
5,282
|
|
(US$ millions)
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Petroleo Brasileiro S.A ("Petrobras")
|
|
19
|
%
|
|
20
|
%
|
|
16
|
%
|
Total S.A Group ("Total")
|
|
16
|
%
|
|
13
|
%
|
|
14
|
%
|
Exxon Mobil Corp ("Exxon")
|
|
14
|
%
|
|
10
|
%
|
|
12
|
%
|
Statoil ASA ("Statoil")
|
|
12
|
%
|
|
13
|
%
|
|
14
|
%
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
Brazil
|
4,074
|
|
|
2,798
|
|
Norway
|
2,094
|
|
|
2,252
|
|
Angola
|
1,452
|
|
|
1,852
|
|
Others *
|
7,310
|
|
|
8,243
|
|
Total
|
14,930
|
|
|
15,145
|
|
|
Year ended December 31
|
|||||||
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Amortization of unfavorable contracts
|
116
|
|
|
130
|
|
|
67
|
|
Amortization of favorable contracts
|
—
|
|
|
—
|
|
|
(2
|
)
|
Revenues related party
|
119
|
|
|
97
|
|
|
2
|
|
External management fees with third parties
|
30
|
|
|
62
|
|
|
45
|
|
Total
|
265
|
|
|
289
|
|
|
112
|
|
(In US$ millions)
|
Net proceeds/recoverable amount
|
|
|
Book value on
disposal
|
|
|
(Loss)/gain
|
|
Year ended December 31, 2015:
|
|
|
|
|
|
|||
Cancellation of West Mira
|
199
|
|
|
279
|
|
|
(80
|
)
|
West Rigel Transferred to Asset held for sale
|
128
|
|
|
210
|
|
|
(82
|
)
|
Sale of West Polaris
|
235
|
|
|
312
|
|
|
(77
|
)
|
SeaMex Limited
|
1,240
|
|
|
1,059
|
|
|
181
|
|
Assets written off
|
—
|
|
|
5
|
|
|
(5
|
)
|
Total for year ended December 31, 2015
|
1,802
|
|
|
1,865
|
|
|
(63
|
)
|
|
|
|
|
|
|
|||
Year ended December 31, 2014:
|
|
|
|
|
|
|
|
|
Sale of West Auriga business
|
466
|
|
|
26
|
|
|
440
|
|
Sale of West Vela business
|
536
|
|
|
344
|
|
|
192
|
|
Total for year ended December 31, 2014
|
1,002
|
|
|
370
|
|
|
632
|
|
|
|
|
|
|
|
|||
Year ended December 31, 2013:
|
|
|
|
|
|
|
|
|
Sale of Jack-up rig West Janus
|
73
|
|
|
12
|
|
|
61
|
|
Total for year ended December 31, 2013
|
73
|
|
|
12
|
|
|
61
|
|
|
Year ended December 31
|
|||||||
(In US$ millions) |
2015
|
|
|
2014
|
|
|
2013
|
|
Gross interest expense
|
475
|
|
|
548
|
|
|
540
|
|
Capitalized interest
|
(60
|
)
|
|
(70
|
)
|
|
(95
|
)
|
Net interest expense
|
415
|
|
|
478
|
|
|
445
|
|
(In $ millions)
|
Year ended December 31, 2015
|
|
Impairments of Investment in associated companies
|
|
|
Seadrill Partners - Total direct ownership investments
|
302
|
|
Seadrill Partners - Subordinated units
|
125
|
|
Seadrill Partners - Seadrill member interest and IDRs
|
106
|
|
Total impairment of investments in associated companies
|
533
|
|
|
|
|
Impairments of Marketable securities
(refer to Note 14)
|
|
|
Seadrill Partners - Common Units
|
574
|
|
SapuraKencana
|
167
|
|
Total impairment of marketable securities investments (reclassification from OCI)
|
741
|
|
|
|
|
Total impairment of investments
|
1,274
|
|
|
Year ended December 31
|
|||||||
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Current tax expense:
|
|
|
|
|
|
|||
Bermuda
|
—
|
|
|
—
|
|
|
—
|
|
Foreign
|
177
|
|
|
23
|
|
|
200
|
|
Deferred tax expense/(benefit):
|
|
|
|
|
|
|
|
|
Bermuda
|
—
|
|
|
—
|
|
|
—
|
|
Foreign
|
31
|
|
|
(4
|
)
|
|
(50
|
)
|
Tax related to internal sale of assets in subsidiary, amortized for group purposes
|
—
|
|
|
—
|
|
|
4
|
|
Total tax expense
|
208
|
|
|
19
|
|
|
154
|
|
Effective tax rate
|
(38.4
|
)%
|
|
0.5
|
%
|
|
5.2
|
%
|
|
Year ended December 31
|
|||||||
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Income taxes at statutory rate
|
—
|
|
|
—
|
|
|
—
|
|
Effect of transfers to new tax jurisdictions
|
—
|
|
|
—
|
|
|
4
|
|
Effect of change on uncertain tax positions relating to prior year
|
—
|
|
|
(85
|
)
|
|
(7
|
)
|
Effect of unremitted earnings of subsidiaries
|
38
|
|
|
—
|
|
|
—
|
|
Effect of taxable income in various countries
|
170
|
|
|
104
|
|
|
157
|
|
Total tax expense
|
208
|
|
|
19
|
|
|
154
|
|
(In US$ millions)
|
December 31,
2015 |
|
|
December 31,
2014 |
|
Pensions and stock options
|
9
|
|
|
19
|
|
Provisions
|
16
|
|
|
20
|
|
Net operating losses carried forward
|
265
|
|
|
291
|
|
Other
|
2
|
|
|
3
|
|
Gross deferred tax asset
|
292
|
|
|
333
|
|
Valuation allowance related to net operating losses carried forward
|
(211
|
)
|
|
(280
|
)
|
Net deferred tax asset
|
81
|
|
|
53
|
|
(In US$ millions)
|
December 31,
2015 |
|
|
December 31,
2014 |
|
Property, plant and equipment
|
98
|
|
|
60
|
|
Unremitted Earnings of Subsidiaries
|
38
|
|
|
—
|
|
Foreign exchange
|
—
|
|
|
7
|
|
Gross deferred tax liability
|
136
|
|
|
67
|
|
Net deferred tax
|
(55
|
)
|
|
(14
|
)
|
(In US$ millions)
|
December 31,
2015 |
|
|
December 31,
2014 |
|
Deferred tax asset
|
81
|
|
|
53
|
|
Deferred tax liability
|
(136
|
)
|
|
(67
|
)
|
Net deferred tax
|
(55
|
)
|
|
(14
|
)
|
|
Year ended December 31
|
|||||||
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Balance beginning of period
|
9
|
|
|
147
|
|
|
154
|
|
Increases as a result of positions taken in prior periods
|
—
|
|
|
9
|
|
|
29
|
|
Increases as a result of positions taken during the current period
|
—
|
|
|
—
|
|
|
12
|
|
Decreases as a result of positions taken in prior periods
|
—
|
|
|
(147
|
)
|
|
(14
|
)
|
Decreases as a result of positions taken in the current period
|
—
|
|
|
—
|
|
|
(34
|
)
|
Balance end of period
|
9
|
|
|
9
|
|
|
147
|
|
Jurisdiction
|
Earliest Open Year
|
United States
|
2013
|
Angola
|
2010
|
Australia
|
2011
|
Nigeria
|
2009
|
Norway
|
2013
|
Thailand
|
2005
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|||
Net (loss)/income attributable to the parent
|
(738
|
)
|
|
3,979
|
|
|
2,653
|
|
Less: Allocation to participating securities
|
—
|
|
|
(6
|
)
|
|
—
|
|
Net (loss)/income available to stockholders
|
(738
|
)
|
|
3,973
|
|
|
2,653
|
|
Effect of dilution
|
—
|
|
|
117
|
|
|
38
|
|
Diluted net (loss)/income available to stockholders
|
(738
|
)
|
|
4,090
|
|
|
2,691
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Basic earnings per share:
|
|
|
|
|
|
|||
Weighted average number of common shares outstanding
|
492.8
|
|
|
478.0
|
|
|
469.0
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
Effect of dilutive convertible bonds
|
—
|
|
|
14.0
|
|
|
22.0
|
|
Effect of dilutive share options*
|
—
|
|
|
1.0
|
|
|
1.0
|
|
Weighted average number of common shares outstanding adjusted for the effects of dilution
|
492.8
|
|
|
493.0
|
|
|
492.0
|
|
(In US$)
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|||
Basic EPS
|
(1.49
|
)
|
|
8.32
|
|
|
5.66
|
|
Diluted EPS
|
(1.49
|
)
|
|
8.30
|
|
|
5.47
|
|
(In $ millions) |
As at June 19, 2015
|
|
Initial enterprise value
|
540
|
|
Less: Debt assumed
|
(336
|
)
|
Initial purchase price
|
204
|
|
|
|
|
Plus: Working capital adjustment
|
31
|
|
Adjusted initial purchase price
|
235
|
|
|
|
|
Cash
|
204
|
|
Plus: Working capital receivable
|
31
|
|
Fair value of purchase consideration recognized on disposal
|
235
|
|
|
|
|
Less: net carrying value of assets and liabilities
|
(271
|
)
|
Less: allocated goodwill to subsidiaries
|
(41
|
)
|
Loss on disposal
|
(77
|
)
|
|
|
|
Contingent consideration realized since disposal
|
32
|
|
(In $ millions)
|
|
As at March 10, 2015
|
|
FAIR VALUE OF CONSIDERATION RECEIVED
|
|
|
|
Net cash consideration received
|
|
749
|
|
Seller’s credit recognized
|
|
250
|
|
Direct repayment of debt by the JV on behalf of Seadrill
|
|
150
|
|
Consideration receivable in respect of
West Titania
|
|
162
|
|
Other related party balances payable
|
|
(71
|
)
|
Cash paid to acquire 50% interest in the JV
|
|
(163
|
)
|
Fair value of consideration received
|
|
1,077
|
|
|
|
|
|
FAIR VALUE OF RETAINED 50% INVESTMENT IN SEAMEX LIMITED
|
|
163
|
|
|
|
|
|
CARRYING VALUE OF NET ASSETS
|
|
|
|
Current assets
|
|
|
|
Cash and cash equivalents
|
|
40
|
|
Deferred tax assets - short term
|
|
8
|
|
Other current assets
|
|
20
|
|
Total current assets
|
|
68
|
|
|
|
|
|
Non-current assets
|
|
|
|
Drilling units
|
|
969
|
|
Deferred tax asset - long term
|
|
4
|
|
Other non-current assets
|
|
86
|
|
Goodwill
|
|
49
|
|
Total non-current assets
|
|
1,108
|
|
Total assets
|
|
1,176
|
|
|
|
|
|
LIABILITIES
|
|
|
|
Current liabilities
|
|
|
|
Trade accounts payable
|
|
(1
|
)
|
Other current liabilities
|
|
(56
|
)
|
Total current liabilities
|
|
(57
|
)
|
|
|
|
|
Non-current liabilities
|
|
|
|
Other non-current liabilities
|
|
(60
|
)
|
Total non-current liabilities
|
|
(60
|
)
|
Total liabilities
|
|
(117
|
)
|
Carrying value of net assets
|
|
1,059
|
|
|
|
|
|
GAIN ON DISPOSAL
|
|
181
|
|
(In US$ millions)
|
As at January 2, 2014
|
|
Fair value of investment in Seadrill Partners (a)
|
3,724
|
|
Carrying value of the non-controlling interest in Seadrill Partners
|
115
|
|
Subtotal
|
3,839
|
|
Less:
|
|
|
Carrying value of Seadrill Partners’ net assets
|
1,260
|
|
Goodwill allocated to Seadrill Partners
|
240
|
|
Gain on deconsolidation of Seadrill Partners
|
2,339
|
|
(In US$ millions)
|
As of January 2, 2014
|
|
Common units (i)
|
671
|
|
Subordinated units (ii)
|
427
|
|
Seadrill Member Interest and Incentive Distribution Rights ("IDRs") (iii)
|
244
|
|
Direct ownership interests (iv)
|
2,382
|
|
Total
|
3,724
|
|
•
|
70%
ownership in Seadrill Operating LP
|
•
|
49%
ownership in Seadrill Capricorn Holdings LLC
|
•
|
39%
ownership of Seadrill Deepwater Drillship Ltd. and
39%
(indirect) ownership of Seadrill Mobile Units (Nigeria) Ltd.
|
(In US$ millions)
|
Book value
|
|
Fair value
|
|
Basis Difference
|
|
Seadrill's share of basis difference
(1)
|
||||
Drilling units
|
3,444
|
|
|
5,245
|
|
|
1,801
|
|
|
1,295
|
|
Drilling contracts
|
—
|
|
|
170
|
|
|
170
|
|
|
142
|
|
Goodwill
|
—
|
|
|
1,214
|
|
|
1,214
|
|
|
352
|
|
Total
|
3,444
|
|
|
6,629
|
|
|
3,185
|
|
|
1,789
|
|
(In US$ millions)
|
March 21, 2014
|
|
Enterprise value
|
1,240
|
|
Less: Debt assumed
|
(443
|
)
|
Purchase price
|
797
|
|
|
|
|
Less: Working capital adjustment
|
(331
|
)
|
Adjusted purchase price
|
466
|
|
|
|
|
Cash
|
697
|
|
Discount note issued
|
100
|
|
Less: Working capital payable
|
(331
|
)
|
Fair value of purchase consideration
|
466
|
|
|
|
|
Less: net carrying value of assets and liabilities
|
7
|
|
Less: allocated goodwill to subsidiaries
|
(33
|
)
|
Gain on sale
|
440
|
|
(In US$ millions)
|
November 4, 2014
|
|
Enterprise value
|
900
|
|
Deferred consideration receivable
|
74
|
|
Less: Debt assumed
|
(433
|
)
|
Purchase price
|
541
|
|
|
|
|
Less: Working capital adjustment
|
(6
|
)
|
Adjusted purchase price
|
535
|
|
|
|
|
Cash
|
467
|
|
Deferred consideration receivable
|
74
|
|
Less: Working capital payable
|
(6
|
)
|
Fair value of purchase consideration
|
535
|
|
|
|
|
Less: net carrying value of assets and liabilities
|
(303
|
)
|
Less: allocated goodwill to subsidiaries
|
(41
|
)
|
Gain on sale
|
191
|
|
(In US$ millions)
|
December 31, 2013
|
|
Fair value of consideration received
|
2,600
|
|
Carry value of assets and liabilities
|
1,324
|
|
Other related costs to sale
|
20
|
|
Total gain on sale
|
1,256
|
|
(In US$ millions)
|
|
January 3, 2013
|
|
|
|
|
|
Fair value of net assets acquired:
|
|
|
|
Drilling units
|
|
698
|
|
Unfavorable contract – Other current liabilities
|
|
(27
|
)
|
Unfavorable contract – Other non-current liabilities
|
|
(81
|
)
|
Net assets acquired
|
|
590
|
|
|
|
|
|
Fair value of consideration
|
|
590
|
|
(In US$ millions)
|
|
March 25, 2013
|
|
|
|
|
|
Cash and cash equivalents
|
|
1
|
|
Current assets
|
|
1
|
|
Drilling units
|
|
633
|
|
Non-current assets
|
|
633
|
|
Construction obligation
|
|
(316
|
)
|
Other current liabilities
|
|
(8
|
)
|
Current liabilities
|
|
(324
|
)
|
Non-current liabilities
|
|
—
|
|
Net assets acquired
|
|
310
|
|
|
|
|
|
Net book value of equity investment
|
|
185
|
|
Fair value of previously held equity investment
|
|
195
|
|
Gain on re-measurement of previously held equity investment
|
|
10
|
|
|
|
|
|
Fair value of establishment of non-controlling interest
|
|
100
|
|
|
|
|
|
Bargain purchase
|
|
|
|
Fair value of establishment of non-controlling interest
|
|
100
|
|
Fair value of previously held equity investment
|
|
195
|
|
Total
|
|
295
|
|
|
|
|
|
Net assets acquired
|
|
310
|
|
Gain on bargain purchase
|
|
15
|
|
(In US$ millions) |
|
July 2,
2013 |
|
|
|
|
|
Cash and cash equivalents
|
|
54
|
|
Restricted cash
|
|
63
|
|
Trade and other receivables
|
|
49
|
|
Current assets
|
|
166
|
|
Drilling units
|
|
1,246
|
|
Newbuildings
|
|
1,227
|
|
Deferred income tax asset
|
|
76
|
|
Valuation allowance income tax asset
|
|
(76
|
)
|
Other non-current assets
|
|
1
|
|
Non-current assets
|
|
2,474
|
|
Total assets
|
|
2,640
|
|
|
|
|
|
Current portion of long-term debt
|
|
(112
|
)
|
Trade and other payables
|
|
(115
|
)
|
Construction obligation
|
|
(923
|
)
|
Unfavorable contracts
|
|
(79
|
)
|
Other current liabilities
|
|
(26
|
)
|
Current liabilities
|
|
(1,255
|
)
|
Long-term interest bearing debt
|
|
(703
|
)
|
Unfavorable contracts
|
|
(257
|
)
|
Other non-current liabilities
|
|
(16
|
)
|
Non-current liabilities
|
|
(976
|
)
|
Total liabilities
|
|
(2,231
|
)
|
Net assets acquired
|
|
409
|
|
|
|
|
|
Net book value of equity investment
|
|
109
|
|
Fair value of previously held equity investment
|
|
117
|
|
Gain on re-measurement of previously held equity investment
|
|
8
|
|
|
|
|
|
Fair value of establishment of non-controlling interest
|
|
197
|
|
|
|
|
|
Bargain purchase
|
|
|
|
Fair value of consideration transferred
|
|
78
|
|
Fair value of establishment of non-controlling interest
|
|
197
|
|
Fair value of previously held equity investment
|
|
117
|
|
Total
|
|
392
|
|
|
|
|
|
Net assets acquired
|
|
409
|
|
Gain on bargain purchase
|
|
17
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
CIRR deposits (1)
|
71
|
|
|
124
|
|
Margin calls related to share forward agreements
|
170
|
|
|
264
|
|
Cash pledged as collateral under credit facilities
|
—
|
|
|
50
|
|
Tax withholding deposits
|
7
|
|
|
11
|
|
Total restricted cash
|
248
|
|
|
449
|
|
Long-term restricted cash
(related to CIRR deposits and margin calls)
|
198
|
|
|
181
|
|
Short-term restricted cash
|
50
|
|
|
268
|
|
|
As at December 31, 2015
|
||||
(In US$ millions)
|
Amortized
cost |
|
Cumulative unrealized fair value gains/(losses)
|
|
Carrying
value |
Sapura Kencana
|
206
|
|
22
|
|
228
|
Seadrill Partners - Common Units
|
247
|
|
(151)
|
|
96
|
Total
|
453
|
|
(129)
|
|
324
|
|
As at December 31, 2014
|
||||
(In US$ millions)
|
Amortized
cost |
|
Cumulative unrealized fair value gains/(losses)
|
|
Carrying
value |
Sapura Kencana
|
373
|
|
(48)
|
|
325
|
Seadrill Partners - Common Units
|
821
|
|
(395)
|
|
426
|
Total
|
1,194
|
|
(443)
|
|
751
|
|
Year ended December 31, 2015
|
||||||||||||
(In US$ millions)
|
Gross realized gains
|
|
Gross realized losses
|
|
Gross Unrealized gains
|
|
Gross Unrealized losses
|
|
Gross proceeds from sales
|
|
Recognition and purchases
|
|
Gain/(loss) reclassified into income
|
Sapura Kencana
|
—
|
|
—
|
|
—
|
|
(97)
|
|
—
|
|
—
|
|
(167)
|
Seadrill Partners - Common Units
|
—
|
|
—
|
|
—
|
|
(330)
|
|
—
|
|
—
|
|
(574)
|
Total
|
—
|
|
—
|
|
—
|
|
(427)
|
|
—
|
|
—
|
|
(741)
|
|
Year ended December 31, 2014
|
||||||||||||
(In US$ millions)
|
Gross realized gains
|
|
Gross realized losses
|
|
Gross Unrealized gains
|
|
Gross Unrealized losses
|
|
Gross proceeds from sales
|
|
Recognition and purchases
|
|
Gain/(loss) reclassified into income
|
Petromena
|
6
|
|
—
|
|
—
|
|
—
|
|
10
|
|
—
|
|
—
|
Sapura Kencana
|
—
|
|
—
|
|
—
|
|
(456)
|
|
297
|
|
—
|
|
131
|
Seadrill Partners - Common Units
|
—
|
|
—
|
|
—
|
|
(395)
|
|
—
|
|
821
|
|
—
|
Total
|
6
|
|
—
|
|
—
|
|
(851)
|
|
307
|
|
821
|
|
131
|
|
Year ended December 31, 2013
|
||||||||||||
(In US$ millions)
|
Gross realized gains
|
|
Gross realized losses
|
|
Gross Unrealized gains
|
|
Gross Unrealized losses
|
|
Gross proceeds from sales
|
|
Recognition and purchases
|
|
Gain/(loss) reclassified into income
|
Petromena
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Sapura Kencana
|
—
|
|
—
|
|
333
|
|
—
|
|
—
|
|
416
|
|
—
|
Total
|
—
|
|
—
|
|
333
|
|
—
|
|
—
|
|
416
|
|
—
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Prepaid expenses
|
42
|
|
|
30
|
|
Reimbursable amounts due from customers
|
48
|
|
|
79
|
|
Deferred mobilization cost
|
55
|
|
|
7
|
|
Deferred consideration
(1)
|
166
|
|
|
—
|
|
Taxes receivable
|
32
|
|
|
29
|
|
Other current assets
|
52
|
|
|
77
|
|
Total other current assets
|
395
|
|
|
222
|
|
(1)
|
The deferred consideration receivable relates to the disposal of the tender rig business to SapuraKencana in 2013, and the balance includes interest accrued. Refer to
Note 11
for more information.
|
Ownership percentage
|
December 31, 2015
|
|
|
December 31, 2014
|
|
|
December 31, 2013
|
|
Archer
|
39.9
|
%
|
|
39.9
|
%
|
|
39.9
|
%
|
Seabras Sapura Participacoes SA (”Seabras Sapura Participacoes”)
|
50.0
|
%
|
|
50.0
|
%
|
|
50.0
|
%
|
Seabras Sapura Holding GmbH (”Seabras Sapura Holdco”)
|
50.0
|
%
|
|
50.0
|
%
|
|
50.0
|
%
|
Itaunas Drilling B.V. (”Itaunas Drilling”)
|
30.0
|
%
|
|
30.0
|
%
|
|
30.0
|
%
|
Camburi Drilling B.V. (”Camburi Drilling”)
|
30.0
|
%
|
|
30.0
|
%
|
|
30.0
|
%
|
Sahy Drilling B.V. (”Sahy Drilling”)
|
30.0
|
%
|
|
30.0
|
%
|
|
30.0
|
%
|
Seadrill Partners (”SDLP”)
|
Note 1
|
|
|
Note 1
|
|
|
Note 1
|
|
SeaMex Ltd. (”SeaMex”)
|
50.0
|
%
|
|
—
|
%
|
|
—
|
%
|
(1)
|
As of the deconsolidation date of Seadrill Partners on January 2, 2014, we recognized our ownership interests in Seadrill Partners and direct ownership interests in Seadrill Partners subsidiaries, at fair value at the date of deconsolidation. Refer to Seadrill Partners paragraph below for additional information.
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Archer
|
—
|
|
|
—
|
|
Seabras Sapura Participacoes
|
29
|
|
|
21
|
|
Seabras Sapura Holding
|
158
|
|
|
117
|
|
Itaunas Drilling
|
3
|
|
|
3
|
|
Camburi Drilling
|
6
|
|
|
6
|
|
Sahy Drilling
|
4
|
|
|
4
|
|
Seadrill Partners - Total direct ownership interests
|
1,767
|
|
|
2,091
|
|
Seadrill Partners - Subordinated Units
|
293
|
|
|
412
|
|
Seadrill Partners - Seadrill Member Interest and IDRs
(1)
|
137
|
|
|
244
|
|
Seamex Ltd.
|
193
|
|
|
—
|
|
Total
|
2,590
|
|
|
2,898
|
|
(1)
|
The Seadrill Partners - Seadrill Member Interest and Incentive Distribution Rights (“IDR’s”) are accounted for as cost-method investments on the basis that they do not represent common stock interests and their fair value is not readily determinable. The investments are held at cost and not subsequently re-measured. For more details on the deconsolidation of Seadrill Partners see
Note 11
for more information.
|
i.
|
42%
in Seadrill Operating LP
: Seadrill Operating LP is a limited partnership and is controlled by its General Partner, Seadrill Operating GP LLC, which is wholly owned by Seadrill Partners.
|
ii.
|
49%
Seadrill Capricorn Holdings LLC
: Seadrill Capricorn Holdings LLC is a limited liability company. There is only
one
class of member interest which is deemed to represent voting common stock.
|
iii.
|
39%
in Seadrill Deepwater Drillship Ltd
and
39%
indirect interest in Seadrill Mobile Units (Nigeria) Ltd.
: Both entities are limited companies and only have
one
class of stock, which is deemed to represent voting common stock.
|
|
As of December 31, 2015
|
|||||||||||||
(In US$ millions)
|
Current assets
|
|
|
Non-current
assets
|
|
|
Current liabilities
|
|
|
Non-current liabilities
|
|
|
Non-Controlling interest
|
|
Archer
|
363
|
|
|
904
|
|
|
319
|
|
|
751
|
|
|
—
|
|
Seabras Sapura Participacoes
|
76
|
|
|
308
|
|
|
79
|
|
|
258
|
|
|
—
|
|
Seabras Sapura Holding
|
133
|
|
|
1,183
|
|
|
80
|
|
|
1,199
|
|
|
—
|
|
Seadrill Partners
|
892
|
|
|
5,949
|
|
|
847
|
|
|
3,897
|
|
|
1,133
|
|
SeaMex
|
218
|
|
|
1,157
|
|
|
176
|
|
|
799
|
|
|
—
|
|
Total
|
1,682
|
|
|
9,501
|
|
|
1,501
|
|
|
6,904
|
|
|
1,133
|
|
|
December 31, 2014
|
|||||||||||||
(In US$ millions)
|
Current assets
|
|
|
Non-current
assets
|
|
|
Current liabilities
|
|
|
Non-current liabilities
|
|
|
Non-Controlling interest
|
|
Archer
|
633
|
|
|
1,171
|
|
|
441
|
|
|
817
|
|
|
—
|
|
Seabras Sapura Participacoes
|
17
|
|
|
194
|
|
|
14
|
|
|
149
|
|
|
—
|
|
Seabras Sapura Holding
|
104
|
|
|
690
|
|
|
52
|
|
|
730
|
|
|
—
|
|
Seadrill Partners
|
762
|
|
|
5,585
|
|
|
686
|
|
|
3,617
|
|
|
1,116
|
|
SeaMex
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
1,516
|
|
|
7,640
|
|
|
1,193
|
|
|
5,313
|
|
|
1,116
|
|
|
Year ended December 31, 2015
|
||||||||||
(In US$ millions)
|
Operating revenues
|
|
|
Net operating
income
|
|
|
Net
income
|
|
|
Net income attributable to non-controlling interest
|
|
Archer
|
1,321
|
|
|
(13
|
)
|
|
(359
|
)
|
|
—
|
|
Seabras Sapura Participacoes
|
53
|
|
|
3
|
|
|
1
|
|
|
—
|
|
Seabras Sapura Holding
|
124
|
|
|
76
|
|
|
51
|
|
|
—
|
|
Seadrill Partners
|
1,742
|
|
|
844
|
|
|
488
|
|
|
231
|
|
Seamex
|
238
|
|
|
79
|
|
|
24
|
|
|
—
|
|
Total
|
3,478
|
|
|
989
|
|
|
205
|
|
|
231
|
|
|
Year ended December 31, 2014
|
||||||||||
(In US$ millions)
|
Operating revenues
|
|
|
Net operating
income
|
|
|
Net
income
|
|
|
Net income attributable to non-controlling interest
|
|
Archer
|
2,254
|
|
|
29
|
|
|
(96
|
)
|
|
—
|
|
Seabras Sapura Participacoes
|
29
|
|
|
(6
|
)
|
|
(6
|
)
|
|
—
|
|
Seabras Sapura Holding
|
39
|
|
|
24
|
|
|
13
|
|
|
—
|
|
Seadrill Partners
|
1,343
|
|
|
615
|
|
|
315
|
|
|
176
|
|
Seamex
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
3,665
|
|
|
662
|
|
|
226
|
|
|
176
|
|
|
Year ended December 31, 2013
|
||||||||||
(In US$ millions)
|
Operating revenues
|
|
|
Net operating
income
|
|
|
Net
income
|
|
|
Net income attributable to non-controlling interest
|
|
Archer
|
2,041
|
|
|
(438
|
)
|
|
(519
|
)
|
|
—
|
|
Seabras Sapura Participacoes
|
—
|
|
|
(2
|
)
|
|
(1
|
)
|
|
—
|
|
Seabras Sapura Holding
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
Seadrill Partners
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Seamex
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
2,041
|
|
|
(440
|
)
|
|
(521
|
)
|
|
—
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
|
December 31, 2013
|
|
Archer
|
79
|
|
|
218
|
|
|
253
|
|
Seabras Sapura Participacoes
|
24
|
|
|
24
|
|
|
13
|
|
Seabras Sapura Holding
|
19
|
|
|
6
|
|
|
—
|
|
Seadrill Partners *
|
N/A
|
|
|
N/A
|
|
|
—
|
|
Seamex
|
200
|
|
|
—
|
|
|
—
|
|
Total
|
322
|
|
|
261
|
|
|
277
|
|
*
|
The Company accounts for its direct interests in operating subsidiaries of Seadrill Partners, and its ownership of Seadrill Partners Subordinated Units, under the equity method. The Company’s share of Seadrill Partner’s recorded equity consists of the equity attributable to non-controlling interests in Seadrill Partners, and additionally a proportionate share of equity attributable to Seadrill Partners’ unitholders.
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Opening balance
|
2,030
|
|
|
3,419
|
|
Additions
|
601
|
|
|
2,433
|
|
Capitalized interest and loan related costs
|
60
|
|
|
70
|
|
Re-classified as Drilling Units
|
(725
|
)
|
|
(3,892
|
)
|
Reclassification to Assets held for sale*
|
(210
|
)
|
|
—
|
|
Reclassification to Non-current assets**
|
(199
|
)
|
|
—
|
|
Disposals**
|
(78
|
)
|
|
—
|
|
Closing balance
|
1,479
|
|
|
2,030
|
|
*
|
On December 2, 2015, the
West Rigel
was classified as an Asset held for sale. As at the transfer date the
West Rigel
held assets at its book value of
$210.0 million
. Please refer to
Note 37
to the consolidated financial statements, included herein, for more details.
|
**
|
On September 14, 2015, the Company cancelled the construction contract for the
West Mira
with HSHI Please refer to
Note 5
to the consolidated financial statements, included herein, for more details.
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Cost
|
17,606
|
|
|
19,101
|
|
Accumulated depreciation
|
(2,676
|
)
|
|
(2,991
|
)
|
Re-classified as assets held for sale
|
—
|
|
|
(965
|
)
|
Net book value
|
14,930
|
|
|
15,145
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Cost
|
80
|
|
|
73
|
|
Accumulated depreciation
|
(34
|
)
|
|
(27
|
)
|
Net book value
|
46
|
|
|
46
|
|
(In $ millions)
|
Year ended December 31,
2015 |
|
|
Year ended December 31,
2014 |
|
Opening balance
|
|
|
|
||
Goodwill
|
836
|
|
|
1,200
|
|
Accumulated impairment losses
|
(232
|
)
|
|
—
|
|
Total opening goodwill
|
604
|
|
|
1,200
|
|
|
|
|
|
||
Disposals and deconsolidations (see note 11)
|
(41
|
)
|
|
(315
|
)
|
Impairment of goodwill
|
(563
|
)
|
|
(232
|
)
|
Re-classified as assets held for sale
|
—
|
|
|
(49
|
)
|
|
|
|
|
||
Closing balance
|
|
|
|
||
Goodwill
|
795
|
|
|
836
|
|
Accumulated impairment losses
|
(795
|
)
|
|
(232
|
)
|
Total closing goodwill
|
—
|
|
|
604
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net carrying amount
|
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net carrying amount
|
||||||
Unfavorable contracts - intangible liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at beginning of period
|
444
|
|
|
(197
|
)
|
|
247
|
|
|
444
|
|
|
(67
|
)
|
|
377
|
|
Additions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Amortization of unfavorable contracts
|
—
|
|
|
(116
|
)
|
|
(116
|
)
|
|
—
|
|
|
(130
|
)
|
|
(130
|
)
|
Balance at end of period
|
444
|
|
|
(313
|
)
|
|
131
|
|
|
444
|
|
|
(197
|
)
|
|
247
|
|
|
Year ended December 31
|
||||||||||||||||
(In US$ millions)
|
2016
|
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
Total
|
|
Amortization of unfavorable contracts
|
65
|
|
|
43
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
131
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Deferred tax effect of internal transfer of assets
|
92
|
|
|
102
|
|
Deferred mobilization costs
|
32
|
|
|
47
|
|
Deferred consideration
|
—
|
|
|
154
|
|
Receivable from shipyard
(1)
|
199
|
|
|
—
|
|
Other
|
8
|
|
|
8
|
|
Total other non-current assets
|
331
|
|
|
311
|
|
(1)
|
The Receivable from shipyard relates to the
West Mira
. Please see
Note 5
–
(Loss)/gain on disposals
for more information
|
(In US$ millions), unless stated otherwise
|
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Credit facilities:
|
|
|
|
|
||
$700 facility
|
|
—
|
|
|
420
|
|
$2,000 facility (NADL)
|
|
1,200
|
|
|
1,367
|
|
$400 facility
|
|
240
|
|
|
280
|
|
$420 facility
|
|
—
|
|
|
351
|
|
$440 facility
|
|
224
|
|
|
258
|
|
$450 facility
|
|
—
|
|
|
416
|
|
$1,450 facility
|
|
393
|
|
|
433
|
|
$360 facility (Asia Offshore Drilling)
|
|
273
|
|
|
309
|
|
$300 facility
|
|
186
|
|
|
210
|
|
$1,750 facility (Sevan Drilling)
|
|
1,085
|
|
|
1,225
|
|
$150 facility
|
|
—
|
|
|
150
|
|
$450 Eminence facility
|
|
344
|
|
|
397
|
|
$1,500 facility
|
|
1,344
|
|
|
1,469
|
|
$1,350 facility
|
|
1,181
|
|
|
1,317
|
|
$950 facility
|
|
688
|
|
|
—
|
|
$450 facility (2015)
|
|
215
|
|
|
—
|
|
Total credit facilities
|
|
7,373
|
|
|
8,602
|
|
|
|
|
|
|
||
Ship Finance Loans
|
|
|
|
|
|
|
$375 facility (SFL Hercules)
|
|
256
|
|
|
284
|
|
$390 facility (SFL Deepwater)
|
|
221
|
|
|
303
|
|
$475 facility (SFL Linus)
|
|
354
|
|
|
451
|
|
Total Ship Finance Loans
|
|
831
|
|
|
1,038
|
|
|
|
|
|
|
||
Unsecured bonds
|
|
|
|
|
||
NOK1,800 million bond
|
|
203
|
|
|
242
|
|
$350 bond
|
|
—
|
|
|
342
|
|
$1,000 bond
|
|
948
|
|
|
1,000
|
|
$500 bond
|
|
479
|
|
|
479
|
|
NOK1,500 million bond (NADL)
|
|
161
|
|
|
190
|
|
$ 600 bond (NADL)
|
|
413
|
|
|
413
|
|
SEK 1,500 bond
|
|
177
|
|
|
190
|
|
Total unsecured bonds
|
|
2,381
|
|
|
2,856
|
|
|
|
|
|
|
||
Other credit facilities with corresponding restricted cash deposits
|
|
76
|
|
|
124
|
|
Total debt principal
|
|
10,661
|
|
|
12,620
|
|
|
|
|
|
|
||
Less: current portion
|
|
(1,526
|
)
|
|
(2,309
|
)
|
Long-term portion
|
|
9,135
|
|
|
10,311
|
|
|
|
Outstanding balance as at December 31, 2015
|
|||||
(In $ millions)
|
|
Principal outstanding
|
|
Less: Debt Issuance Costs
|
|
Total Debt
|
|
Current portion of long-term debt
|
|
1,526
|
|
(37
|
)
|
1,489
|
|
Long-term debt
|
|
9,135
|
|
(81
|
)
|
9,054
|
|
Total
|
|
10,661
|
|
(118
|
)
|
10,543
|
|
|
|
Outstanding debt as at December 31, 2014
|
|||||
(In $ millions)
|
|
Principal outstanding
|
|
Less: Debt Issuance Costs
|
|
Total Debt
|
|
Current portion of long-term debt
|
|
2,309
|
|
(42
|
)
|
2,267
|
|
Long-term debt
|
|
10,311
|
|
(103
|
)
|
10,208
|
|
Total
|
|
12,620
|
|
(145
|
)
|
12,475
|
|
(In US$ millions)
|
|
December 31, 2015
|
|
2016
|
|
1,526
|
|
2017
|
|
2,872
|
|
2018
|
|
2,432
|
|
2019
|
|
2,817
|
|
2020
|
|
1,014
|
|
2021 and thereafter
|
|
—
|
|
Total debt principal
|
|
10,661
|
|
•
|
Aggregated minimum liquidity requirement for the group: to maintain cash and cash equivalents of at least
$150 million
within the group.
|
•
|
Interest coverage ratio: to maintain an EBITDA to interest expense ratio of at least
2.5
:1.
|
•
|
Current ratio: to maintain current assets to current liabilities ratio of at least
1
:1. Current assets are defined as book value less minimum liquidity, but including up to
20.0%
of shares in listed companies owned
20.0%
or more. Current liabilities are defined as book value less the current portion of long term debt.
|
•
|
Equity ratio: to maintain total equity to total assets ratio of at least
30.0%
. Both equity and total assets are adjusted for the difference between book and market values of drilling units.
|
•
|
Leverage ratio: to maintain a ratio of net debt to EBITDA no greater than
4.5
:1. This was amended in May 2015, which has been discussed further below. Net debt is calculated as all interest bearing debt less cash and cash equivalents excluding minimum liquidity requirements.
|
•
|
Debt service coverage ratio: The
$1,450 million
senior secured credit facility for the combined borrowers, and the
$1,500 million
senior secured credit facility for the individual borrowers, contain a requirement to maintain a ratio of EBITDA of the respective borrower to debt services (being all finance charges and principal) of not less than
1.15
:1.
|
•
|
6.0
:1, from and including the financial quarter starting on July 1, 2015 and including the financial quarter ending on September 30, 2016;
|
•
|
5.5
:1, from and including the financial quarter starting on October 1, 2016 and including the financial quarter ending December 31, 2016;
|
•
|
4.5
:1, from and including the financial quarter starting on January 1, 2017 until the final maturity date.
|
•
|
.125%
per annum if the leverage ratio is
4.50
:1 up to and including
4.99
:1;
|
•
|
.25%
per annum if the leverage ratio is
5.00
:1 up to and including
5.49
:1;
|
•
|
.75%
per annum if the leverage ratio is
5.50
:1 up to and including
6.00
:1
|
•
|
Extensions:
|
◦
|
$450 million Senior Secured Credit Facility
: The maturity of the
$450 million
senior secured credit facility, relating to the
Eminence
rig, has been extended from June 20, 2016 to December 31, 2016. In addition, the margin has been reset to 250 basis points.
|
◦
|
$400 million Senior Secured Credit Facility
: The maturity of the
$400 million
senior secured credit facility, relating to jack-up rigs
West Cressida
,
West Callisto
,
West Leda
and
West Triton,
has been extended from December 8, 2016 to May 31, 2017.
|
◦
|
$2 billion Senior Secured Credit Facility
: The maturity of the
$2 billion
senior secured credit facility of our majority-owned subsidiary NADL has been extended from April 15, 2017 to June 30, 2017.
|
•
|
Key amendments and waivers:
|
◦
|
Equity ratio
: The Company is required to maintain a total equity to total assets ratio of at least
30.0%
. Prior to the amendment, both total equity and total assets were adjusted for the difference between book and market values of drilling units, as determined by independent broker valuations. The amendment removes the need for the market value adjustment from the calculation of the equity ratio until June 30, 2017.
|
•
|
Leverage ratio
: The Company is required to maintain a ratio of net debt to EBITDA. Prior to the amendment the leverage ratio had to be no greater than
6.0
:1, falling to
5.5
:1 from October 1, 2016, and falling again to
4.5
:1 from January 1, 2017. The amendment retains the ratio at
6.0
:1 until December 31, 2016, and then increases to
6.5
:1 between January 1, 2017 and June 30, 2017.
|
•
|
Minimum-value-clauses
: The Company’s secured bank credit facilities contain loan-to-value clauses, or minimum-value-clauses (“MVC”), which could require the Company to post additional collateral or prepay a portion of the outstanding
|
•
|
Minimum Liquidity
: The Company has previously been required to maintain a minimum of
$150 million
of liquidity. This has been reset to
$250 million
until June 30, 2017.
|
•
|
Additional undertakings:
|
◦
|
Further process
: The Company has agreed to consultation, information provision and certain processes in respect of further discussions with its lenders under its senior secured credit facilities.
|
◦
|
Restrictive undertakings
: The Company has agreed to additional near-term restrictive undertakings applicable during this process, including (without limitation) limitations in respect of:
|
▪
|
dividends, share capital repurchases and total return swaps;
|
▪
|
investments in, extensions of credit to or the provision of financial support for non-wholly owned subsidiaries;
|
▪
|
investments in, extensions of credit to or the provision of financial support for joint ventures or associated entities;
|
▪
|
acquisitions;
|
▪
|
dispositions;
|
▪
|
prepayment, repayment or repurchase of any debt obligations;
|
▪
|
granting security; and
|
▪
|
payments in respect of newbuild drilling units,
|
•
|
Other changes and provisions:
|
◦
|
Undrawn availability
: The Company has agreed to refrain from borrowing any undrawn commitments under its senior secured credit facilities.
|
◦
|
Fees
: The Company has agreed to pay certain fees to its lenders in consideration of these extensions and amendments.
|
•
|
total loss or sale of a drilling unit securing a credit facility;
|
•
|
cancellation or termination of any existing charter contract or satisfactory drilling contract; and
|
•
|
a change of control.
|
•
|
failure to comply with the financial or insurance covenants;
|
•
|
cross-default to other indebtedness held by both Seadrill Partners and its subsidiaries and by the Company;
|
•
|
failure by the Company to remain listed on a stock exchange;
|
•
|
the occurrence of a material adverse change;
|
•
|
revocation, termination, or modification of any authorization, license, consent, permission, or approval as necessary to conduct operations as contemplated by the applicable Rig Financing Agreement; and
|
•
|
the destruction, abandonment, seizure, appropriation or forfeiture of property of the guarantors or the Company and its subsidiaries, or the limitation by seizure, expropriation, nationalization, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority, of the authority or ability of the Company or any subsidiary thereof to conduct its business, which has or reasonably may be expected to have a material adverse effect.
|
•
|
guarantees from rig owning subsidiaries (guarantors),
|
•
|
a first priority share pledge over all the shares issued by each of the guarantors,
|
•
|
a first priority perfected mortgage in all collateral rigs and any deed of covenant thereto, subject to contractual agreed “quiet enjoyment” undertakings with the end-user of the collateral rigs to be entered into if this is required by the relevant end-user pursuant to the relevant contract,
|
•
|
a first priority security interest over each of the rig owners’ with respect to all earnings and proceeds of insurance, and
|
•
|
a first priority security interest in the earnings accounts.
|
•
|
Ship Finance must maintain cash and cash equivalents of at least
$25 million
.
|
•
|
Ship Finance must maintain positive working capital.
|
•
|
Ship Finance must have a ratio of total liabilities to total assets of at least
0.8
to
1.0
at the end of each quarter.
|
•
|
The Company’s covenants under the bank loans listed above also apply.
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Taxes payable
|
168
|
|
|
160
|
|
Employee withheld taxes, social security and vacation payment
|
87
|
|
|
122
|
|
Intangible liabilities - unfavorable contracts (1)
|
65
|
|
|
116
|
|
Accrued interest expense
|
70
|
|
|
77
|
|
Liabilities relating to investment in shares (2)
|
—
|
|
|
167
|
|
Deferred mobilization revenue
|
208
|
|
|
178
|
|
Derivative financial instruments (3)
|
424
|
|
|
372
|
|
Accrued expenses
|
173
|
|
|
292
|
|
Construction obligation (4)
|
460
|
|
|
428
|
|
Other current liabilities
|
29
|
|
|
22
|
|
Total other current liabilities
|
1,684
|
|
|
1,934
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Accrued pension liabilities
|
37
|
|
|
84
|
|
Deferred mobilization revenues
|
128
|
|
|
224
|
|
Intangible liabilities - unfavorable contracts (1)
|
66
|
|
|
131
|
|
Financing secured on SapuraKencana shares (Note 32)
|
160
|
|
|
250
|
|
Other non-current liabilities
|
10
|
|
|
10
|
|
Total other non-current liabilities
|
401
|
|
|
699
|
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||
All shares are common shares of $2.00 par value each
|
Shares
|
|
|
$millions
|
|
|
Shares
|
|
|
$millions
|
|
|
Shares
|
|
|
$millions
|
|
Authorized share capital
|
800,000,000
|
|
|
1,600
|
|
|
800,000,000
|
|
|
1,600
|
|
|
800,000,000
|
|
|
1,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Issued and fully paid share capital
|
493,078,680
|
|
|
986
|
|
|
493,078,678
|
|
|
986
|
|
|
469,250,933
|
|
|
939
|
|
Treasury shares held by Company
|
(318,740
|
)
|
|
(1
|
)
|
|
(318,740
|
)
|
|
(1
|
)
|
|
(272,441
|
)
|
|
(1
|
)
|
Outstanding shares in issue
|
492,759,940
|
|
|
985
|
|
|
492,759,938
|
|
|
985
|
|
|
468,978,492
|
|
|
938
|
|
(In US$ millions)
|
|
Ship Finance International Ltd VIEs
|
|
North Atlantic Drilling Ltd
|
|
Seadrill Partners LLC
|
|
Asia Offshore Drilling Ltd
|
|
Sevan Drilling ASA
|
|
Seadrill Offshore Nigeria Limited and Seadrill Nigeria Operations Limited
|
|
Total
|
|||||||
December 31, 2012
|
|
274
|
|
|
168
|
|
|
79
|
|
|
—
|
|
|
—
|
|
|
|
|
|
521
|
|
Changes in 2013
|
|
(220
|
)
|
|
(56
|
)
|
|
15
|
|
|
100
|
|
|
197
|
|
|
|
|
|
36
|
|
Net income attributable to non-controlling interest in 2013
|
|
24
|
|
|
61
|
|
|
21
|
|
|
11
|
|
|
16
|
|
|
|
|
|
133
|
|
December 31, 2013
|
|
78
|
|
|
173
|
|
|
115
|
|
|
111
|
|
|
213
|
|
|
—
|
|
|
690
|
|
Changes in 2014
|
|
(57
|
)
|
|
(4
|
)
|
|
(115
|
)
|
|
—
|
|
|
—
|
|
|
4
|
|
|
(172
|
)
|
Net income attributable to non-controlling interest in 2014
|
|
11
|
|
|
36
|
|
|
—
|
|
|
23
|
|
|
38
|
|
|
—
|
|
|
108
|
|
December 31, 2014
|
|
32
|
|
|
205
|
|
|
—
|
|
|
134
|
|
|
251
|
|
|
4
|
|
|
626
|
|
Changes in 2015
|
|
—
|
|
|
8
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
(4
|
)
|
|
(10
|
)
|
Net income attributable to non-controlling interest in 2015
|
|
(17
|
)
|
|
(46
|
)
|
|
—
|
|
|
20
|
|
|
31
|
|
|
—
|
|
|
(12
|
)
|
December 31, 2015
|
|
15
|
|
|
167
|
|
|
—
|
|
|
140
|
|
|
282
|
|
|
—
|
|
|
604
|
|
(In US$ millions)
|
December 31,
2015 |
|
|
December 31,
2014 |
|
Unrealized (loss)/gain on marketable securities
|
(129
|
)
|
|
(443
|
)
|
Unrealized gain on foreign exchange
|
36
|
|
|
51
|
|
Actuarial loss relating to pension
|
(38
|
)
|
|
(57
|
)
|
Share in unrealized gains from associated companies
|
11
|
|
|
1
|
|
Accumulated other comprehensive (loss)/income
|
(120
|
)
|
|
(448
|
)
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||
|
Options
|
|
|
Weighted average exercise price
$
|
|
|
Options
|
|
|
Weighted average exercise price
$
|
|
|
Options
|
|
|
Weighted average exercise price
$
|
|
Outstanding at beginning of year
|
2,241,116
|
|
|
35.10
|
|
|
2,838,758
|
|
|
28.53
|
|
|
3,875,891
|
|
|
29.88
|
|
Granted
|
710,000
|
|
|
12.04
|
|
|
—
|
|
|
—
|
|
|
270,000
|
|
|
45.66
|
|
Exercised
|
—
|
|
|
—
|
|
|
(461,477
|
)
|
|
20.19
|
|
|
(700,418
|
)
|
|
22.60
|
|
Forfeited
|
(935,945
|
)
|
|
32.81
|
|
|
(136,165
|
)
|
|
34.57
|
|
|
(606,715
|
)
|
|
32.30
|
|
Outstanding at end of year
|
2,015,171
|
|
|
28.53
|
|
|
2,241,116
|
|
|
35.10
|
|
|
2,838,758
|
|
|
28.53
|
|
Exercisable at end of year
|
882,152
|
|
|
36.14
|
|
|
1,169,584
|
|
|
27.38
|
|
|
1,080,306
|
|
|
27.38
|
|
Restricted Stock Units - Seadrill
|
2015
|
|
2014
|
|
2013
|
|||
Outstanding at beginning of year
|
525,210
|
|
|
373,700
|
|
|
—
|
|
Granted
|
937,970
|
|
|
162,560
|
|
|
373,700
|
|
Forfeited
|
(60,200
|
)
|
|
(11,050
|
)
|
|
—
|
|
Outstanding at end of year
|
1,402,980
|
|
|
525,210
|
|
|
373,700
|
|
Restricted Stock Units - NADL
|
2015
|
|
2014
|
|
2013
|
|||
Outstanding at beginning of year
|
253,870
|
|
|
278,778
|
|
|
—
|
|
Granted
|
1,587,719
|
|
|
—
|
|
|
278,778
|
|
Adjustment *
|
(1,571,251
|
)
|
|
—
|
|
|
—
|
|
Forfeited
|
(95,755
|
)
|
|
(24,908
|
)
|
|
—
|
|
Outstanding at end of year
|
174,583
|
|
|
253,870
|
|
|
278,778
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
Non-current liabilities
|
37
|
|
|
82
|
|
Deferred tax asset
|
(8
|
)
|
|
(22
|
)
|
Shareholders equity
|
29
|
|
|
60
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Service cost
|
12
|
|
|
13
|
|
|
14
|
|
Interest cost on prior years’ benefit obligation
|
4
|
|
|
7
|
|
|
7
|
|
Gross pension cost for the year
|
16
|
|
|
20
|
|
|
21
|
|
Expected return on plan assets
|
(3
|
)
|
|
(6
|
)
|
|
(4
|
)
|
Administration charges
|
1
|
|
|
1
|
|
|
—
|
|
Net pension cost for the year
|
14
|
|
|
15
|
|
|
17
|
|
Social security cost
|
2
|
|
|
2
|
|
|
2
|
|
Amortization of actuarial gains/losses
|
3
|
|
|
2
|
|
|
2
|
|
Impact of settlement/curtailment funded status
|
—
|
|
|
—
|
|
|
(2
|
)
|
Total net pension cost
|
19
|
|
|
19
|
|
|
19
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Projected benefit obligations at end of period
|
130
|
|
|
186
|
|
Plan assets at market value
|
(97
|
)
|
|
(114
|
)
|
Accrued pension liability exclusive social security
|
33
|
|
|
72
|
|
Social security related to pension obligations
|
4
|
|
|
10
|
|
Accrued pension liabilities
|
37
|
|
|
82
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
Projected benefit obligations at beginning of period
|
186
|
|
|
180
|
|
Interest cost
|
4
|
|
|
7
|
|
Service cost
|
12
|
|
|
13
|
|
Benefits paid
|
(2
|
)
|
|
(2
|
)
|
Change in unrecognized actuarial gain
|
(20
|
)
|
|
23
|
|
Settlement
|
(20
|
)
|
|
—
|
|
Foreign currency translations
|
(30
|
)
|
|
(35
|
)
|
Projected benefit obligations at end of period
|
130
|
|
|
186
|
|
(In US$ millions)
|
2015
|
|
|
2014
|
|
Fair value of plan assets at beginning of year
|
114
|
|
|
129
|
|
Estimated return
|
3
|
|
|
2
|
|
Contribution by employer
|
12
|
|
|
17
|
|
Administration charges
|
(1
|
)
|
|
(1
|
)
|
Benefits paid
|
(2
|
)
|
|
(2
|
)
|
Change in unrecognized actuarial loss
|
—
|
|
|
(9
|
)
|
Settlement
|
(11
|
)
|
|
—
|
|
Foreign currency translations
|
(18
|
)
|
|
(22
|
)
|
Fair value of plan assets at end of year
|
97
|
|
|
114
|
|
(In %)
|
2015
|
|
|
2014
|
|
Equity securities
|
6.1
|
%
|
|
7.2
|
%
|
Debt securities
|
47.5
|
%
|
|
51.9
|
%
|
Real estate
|
14.7
|
%
|
|
14.2
|
%
|
Money market
|
25.2
|
%
|
|
23.5
|
%
|
Other
|
6.5
|
%
|
|
3.20
|
%
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
(In US$ millions)
|
December 31, 2015
|
|
2016
|
12
|
|
2017
|
12
|
|
2018
|
12
|
|
2019
|
13
|
|
2020
|
13
|
|
2021-2025
|
70
|
|
Total payments expected during the next 10 years
|
132
|
|
•
|
Seadrill Partners
|
•
|
Archer
|
•
|
SeaMex
|
•
|
Seabras Sapura
|
•
|
Hemen and affiliated companies
|
(In US$ millions)
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Management fees charged to Seadrill Partners - Other revenues (a) and (b)
|
|
75
|
|
|
59
|
|
|
—
|
|
Rig operating expenses charged to Seadrill Partners - Other revenues (c)
|
|
29
|
|
|
22
|
|
|
—
|
|
Insurance premiums charged to Seadrill Partners (d)
|
|
20
|
|
|
21
|
|
|
—
|
|
Rig operating costs charged by Seadrill Partners (e)
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
Bareboat charter arrangements (f)
|
|
(2
|
)
|
|
(26
|
)
|
|
—
|
|
Interest expenses charged to Seadrill Partners (g)
|
|
16
|
|
|
40
|
|
|
—
|
|
Derivatives recharged to Seadrill Partners (h)
|
|
10
|
|
|
42
|
|
|
—
|
|
Net related party income from Seadrill Partners
|
|
135
|
|
|
158
|
|
|
—
|
|
(In US$ millions)
|
|
December 31,
2015 |
|
|
December 31,
2014 |
|
Rig financing agreements and Loan Agreements (i)
|
|
197
|
|
|
237
|
|
$109.5 million Vendor financing loan (j)
|
|
110
|
|
|
110
|
|
Deferred consideration receivable (k)
|
|
96
|
|
|
74
|
|
Other receivables (l)
|
|
355
|
|
|
264
|
|
Other payables (l)
|
|
(179
|
)
|
|
(77
|
)
|
•
|
Ship Finance International Limited (“Ship Finance”);
|
•
|
Metrogas Holdings Inc (“Metrogas”);
|
•
|
Frontline Management (Bermuda) Limited (“Frontline”); and
|
•
|
Seatankers Management Norway AS (“Seatankers”).
|
•
|
an immediate non-cash cancellation of the total commitment under the MRCFA from
$750 million
to
$687.5 million
;
|
•
|
relaxation of certain financial covenants on the bank loan; and
|
•
|
A further repayment and cancellation of the commitment under the MRCFA from
$687.5 million
to
$625 million
by April 30, 2016
|
(In $ millions)
|
|
December 31, 2015
|
|
|
December 31,
2014 |
|
Seller’s credit
|
|
250
|
|
|
—
|
|
Short term funding
|
|
45
|
|
|
—
|
|
Other receivables
|
|
34
|
|
|
—
|
|
Maturity date
|
|
Total outstanding principal as at December 31, 2015
|
|
Receive rate
|
|
Pay rate range
|
||
|
|
(In US$ millions)
|
|
|
|
|
|
|
Expiring in 2016
|
|
1,000
|
|
3 month LIBOR
|
|
2.14%
|
|
2.24%
|
Expiring in 2016
|
|
18
|
|
6 month LIBOR
|
|
3.83%
|
|
3.83%
|
Expiring in 2017
|
|
1,406
|
|
3 month LIBOR
|
|
0.74%
|
|
3.8%
|
Expiring in 2018
|
|
1,000
|
|
3 month LIBOR
|
|
2.83%
|
|
3.34%
|
Expiring in 2019
|
|
680
|
|
3 month LIBOR
|
|
1.11%
|
|
1.36%
|
Expiring in 2020
|
|
2,632
|
|
3 month LIBOR
|
|
1.36%
|
|
2.19%
|
Expiring in 2021 and thereafter
|
|
352
|
|
3 month LIBOR
|
|
1.38%
|
|
2.92%
|
Total
|
|
7,088
|
|
|
|
|
|
|
Variable interest entity
|
|
Outstanding principal as at December 31, 2015
|
|
Receive rate
|
|
Pay rate
|
|
Length of contract
|
|
|
(In US$ millions)
|
|
|
|
|
|
|
SFL Linus Limited
(West Linus)
|
|
4.0
|
|
1 month LIBOR
|
|
2.01%
|
|
Mar 2014 - Oct 2018
|
SFL Linus Limited
(West Linus)
|
|
4.0
|
|
2 month LIBOR
|
|
2.01%
|
|
Mar 2014 - Nov 2018
|
SFL Linus Limited
(West Linus)
|
|
191.9
|
|
3 month LIBOR
|
|
1.77%
|
|
Dec 2013 - Dec 2018
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In US$ millions)
|
|
Fair
value
|
|
|
Carrying
value
|
|
|
Fair
value
|
|
|
Carrying
value
|
|
Assets
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
1,044
|
|
|
1,044
|
|
|
831
|
|
|
831
|
|
Restricted cash
|
|
248
|
|
|
248
|
|
|
449
|
|
|
449
|
|
Related party loans receivable - short term
|
|
371
|
|
|
371
|
|
|
69
|
|
|
69
|
|
Related party loans receivable - long term
|
|
464
|
|
|
464
|
|
|
311
|
|
|
311
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||
Current portion of floating rate debt
|
|
1,493
|
|
|
1,493
|
|
|
1,928
|
|
|
1,928
|
|
Long-term portion of floating rate debt
|
|
6,711
|
|
|
6,711
|
|
|
7,713
|
|
|
7,713
|
|
Current portion of fixed rate CIRR loans
|
|
33
|
|
|
33
|
|
|
39
|
|
|
39
|
|
Long term portion of fixed rate CIRR loans
|
|
43
|
|
|
43
|
|
|
84
|
|
|
84
|
|
Fixed interest bonds - short term
|
|
—
|
|
|
—
|
|
|
323
|
|
|
342
|
|
Fixed interest bonds - long term
|
|
944
|
|
|
1,840
|
|
|
1,545
|
|
|
1,892
|
|
Floating interest bonds - long term
|
|
283
|
|
|
541
|
|
|
483
|
|
|
622
|
|
Related party fixed rate debt - long term
|
|
415
|
|
|
415
|
|
|
415
|
|
|
415
|
|
|
|
Fair value
|
|
|
Fair value measurements
at reporting date using
|
|||||||
|
|
|
|
Quoted Prices in Active Markets for Identical Assets
|
|
|
Significant Other Observable Inputs
|
|
|
Significant Unobservable Inputs
|
|
|
(In US$ millions)
|
|
December 31, 2015
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
||||
Marketable securities - current and non-current assets
|
|
324
|
|
|
324
|
|
|
—
|
|
|
—
|
|
Interest rate swap contracts – non-current assets
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
Total assets
|
|
326
|
|
|
324
|
|
|
2
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||
Interest rate swap contracts – current liabilities
|
|
124
|
|
|
—
|
|
|
124
|
|
|
—
|
|
Interest rate swap contracts – non-current liabilities
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
Cross currency interest rate swap contracts – current liabilities
|
|
291
|
|
|
—
|
|
|
291
|
|
|
—
|
|
Other derivative instruments – current liabilities
|
|
9
|
|
|
—
|
|
|
9
|
|
|
—
|
|
Total liabilities
|
|
426
|
|
|
—
|
|
|
426
|
|
|
—
|
|
|
|
Fair value
|
|
|
Fair value measurements
at reporting date using
|
|||||||
|
|
|
|
Quoted Prices in Active Markets for Identical Assets
|
|
|
Significant Other Observable Inputs
|
|
|
Significant Unobservable Inputs
|
|
|
(In US$ millions)
|
|
December 31, 2014
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
||||
Marketable securities - current and non-current assets
|
|
751
|
|
|
751
|
|
|
—
|
|
|
—
|
|
Interest rate swap contracts – non-current assets
|
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
Total assets
|
|
756
|
|
|
751
|
|
|
5
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||
Interest rate swap contracts – current liabilities
|
|
139
|
|
|
—
|
|
|
139
|
|
|
—
|
|
Interest rate swap contracts – non-current liabilities
|
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
Cross currency interest rate swap contracts – current liabilities
|
|
201
|
|
|
—
|
|
|
201
|
|
|
—
|
|
Foreign exchange forwards – current liabilities
|
|
27
|
|
|
—
|
|
|
27
|
|
|
—
|
|
Other derivative instruments – current liabilities
|
|
5
|
|
|
—
|
|
|
5
|
|
|
—
|
|
Total liabilities
|
|
375
|
|
|
—
|
|
|
375
|
|
|
—
|
|
(In US$ millions)
|
|
|
Beginning balance January 1, 2014
|
4
|
|
Beginning balance Realization
|
6
|
|
Beginning balance Proceeds on disposal
|
(10
|
)
|
Closing balance December 31, 2014
|
—
|
|
|
|
|
Closing balance December 31, 2015
|
—
|
|
(US$ millions)
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Petroleo Brasileiro S.A ("Petrobras")
|
|
19
|
%
|
|
20
|
%
|
|
16
|
%
|
Total S.A Group ("Total")
|
|
16
|
%
|
|
13
|
%
|
|
14
|
%
|
Exxon Mobil Corp ("Exxon")
|
|
14
|
%
|
|
10
|
%
|
|
12
|
%
|
Statoil ASA ("Statoil")
|
|
12
|
%
|
|
13
|
%
|
|
14
|
%
|
(In US$ millions)
|
2016
|
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021 and thereafter
|
|
|
Total
|
|
Newbuildings
|
188
|
|
|
2,158
|
|
|
1,174
|
|
|
529
|
|
|
—
|
|
|
—
|
|
|
4,049
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Guarantees in favor of customers
1, 2 ,3
|
1,530
|
|
|
1,824
|
|
Guarantees in favor of banks
1, 2, 3, 4
|
1,632
|
|
|
1,254
|
|
Guarantees in favor of suppliers
1, 3, 4
|
2,744
|
|
|
3,898
|
|
Total
|
5,906
|
|
|
8,404
|
|
(1)
|
Guarantees to Seadrill Partners -
Within guarantees in favor of customers are guarantees provided on behalf of Seadrill Partners of
$370 million
(
2014
:
$370 million
). Guarantees in favor of banks include guarantees provided on behalf of Seadrill Partners of
$698 million
(
2014
:
$423 million
). Guarantees in favor of suppliers includes guarantees on behalf of Seadrill Partners of
$86 million
(
2014
:
$92 million
). See
Note 31
to the consolidated financial statements included herein.
|
(2)
|
Guarantees to SeaMex -
Within guarantees in favor of customers are guarantees provided on behalf of SeaMex of
$30 million
(
2014
:
$0 million
). Guarantees in favor of banks includes guarantees on behalf of SeaMex of
$81 million
(
2014
:
$0 million
). See
Note 31
to the consolidated financial statements included herein.
|
(3)
|
Guarantees to Archer -
Within guarantees provided to customers are guarantees provided on behalf of Archer of
$8 million
(
2014
:
nil
). Within guarantees in favor of banks are guarantees provided on behalf of Archer of
$268 million
and
EUR 33 million
(
$36 million
)
|
(4)
|
Guarantees to Seabras Sapura -
Within guarantees in favor of banks are guarantees provided on behalf of Seabras Sapura Participacoes and Seabras Sapura Holdco totaling
$550 million
(
2014
:
$293 million
). Within guarantees in favor of suppliers are guarantees provided in relation to our joint ventures Seabras Sapura Participacoes and Seabras Sapura Holdco of EUR
0
million (
$0 million
) and
$125 million
respectively (
2014
: EUR
47 million
(
$60 million
) and
$375 million
respectively). See
Note 31
to the consolidated financial statements included herein.
|
Year
|
(In US$ millions)
|
|
2016
|
11
|
|
2017
|
10
|
|
2018
|
8
|
|
2019
|
6
|
|
2020
|
6
|
|
2021 and thereafter
|
13
|
|
Total
|
54
|
|
Unit
|
|
Effective
from
|
|
Sale value
(In $ millions)
|
|
First
repurchase
option
(In $ millions)
|
|
Month of first
repurchase
option
|
|
Last
repurchase
option *
(In $ millions)
|
|
Month of last
repurchase
Option *
|
West Taurus
|
|
Nov 2008
|
|
850
|
|
418
|
|
February 2015
|
|
149
|
|
November 2023
|
West Hercules
|
|
Oct 2008
|
|
850
|
|
580
|
|
August 2011
|
|
135
|
|
August 2023
|
West Linus
|
|
June 2013
|
|
600
|
|
370
|
|
June 2018
|
|
170
|
|
June 2028
|
(In US$ millions)
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||
|
SFL
Deepwater Limited |
|
|
SFL
Hercules Limited |
|
|
SFL
Linus Limited |
|
|
SFL West
Polaris Limited * |
|
SFL
Deepwater Ltd. |
|
|
SFL
Hercules Limited |
|
|
SFL
Linus Limited |
|
Name of unit
|
West Taurus
|
|
|
West Hercules
|
|
|
West Linus
|
|
|
West
Polaris |
|
West
Taurus and West Hercules |
|
|
West Hercules
|
|
|
West Linus
|
|
Investment in finance lease
|
394
|
|
|
394
|
|
|
530
|
|
|
N/A
|
|
429
|
|
|
426
|
|
|
574
|
|
Amount due from related parties
|
4
|
|
|
5
|
|
|
—
|
|
|
N/A
|
|
45
|
|
|
5
|
|
|
14
|
|
Other assets
|
2
|
|
|
2
|
|
|
—
|
|
|
N/A
|
|
13
|
|
|
10
|
|
|
—
|
|
Total assets
|
400
|
|
|
401
|
|
|
530
|
|
|
N/A
|
|
487
|
|
|
441
|
|
|
588
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Short-term interest bearing debt
|
23
|
|
|
28
|
|
|
51
|
|
|
N/A
|
|
32
|
|
|
28
|
|
|
51
|
|
Long-term interest bearing debt
|
198
|
|
|
229
|
|
|
302
|
|
|
N/A
|
|
271
|
|
|
256
|
|
|
400
|
|
Other liabilities
|
3
|
|
|
1
|
|
|
2
|
|
|
N/A
|
|
6
|
|
|
1
|
|
|
3
|
|
Short-term debt due to related parties
|
—
|
|
|
—
|
|
|
23
|
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
Long-term debt due to related parties
|
137
|
|
|
125
|
|
|
125
|
|
|
N/A
|
|
145
|
|
|
145
|
|
|
125
|
|
Total liabilities
|
361
|
|
|
383
|
|
|
503
|
|
|
N/A
|
|
454
|
|
|
430
|
|
|
579
|
|
Equity
|
39
|
|
|
18
|
|
|
27
|
|
|
N/A
|
|
33
|
|
|
11
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Book value of units in the Company's consolidated accounts
|
434
|
|
|
571
|
|
|
559
|
|
|
N/A
|
|
450
|
|
|
603
|
|
|
581
|
|
Date
|
Number of Common Units Issued to the Public
|
|
Number of Common Units Issued to Seadrill
|
|
Offering Price ($)
|
|
Gross proceeds from public
($'millions) |
|
Net proceeds from public ($'millions)
|
|
Seadrill's ownership after the offering
|
|
October 24, 2012 (IPO)
|
10,062,500
|
|
14,752,525
|
|
22.00
|
|
221
|
|
203
|
|
75.67
|
%
|
October 18, 2013
|
—
|
|
3,310,622
|
|
32.29
|
|
—
|
|
—
|
|
77.47
|
%
|
December 13, 2013
|
12,880,000
|
|
3,394,916
|
|
29.50
|
|
380
|
|
365
|
|
62.35
|
%
|
(In US$millions)
|
T-15
|
|
T-16
|
|
West Sirius
|
|
West Leo
|
|
Total
|
|
Adjusted sales price *
|
74
|
|
68
|
|
922
|
|
729
|
|
1,793
|
|
Less net assets transferred
|
5
|
|
—
|
|
(375
|
)
|
(116
|
)
|
(486
|
)
|
Excess of sales price over net assets transferred
|
79
|
|
68
|
|
547
|
|
613
|
|
1,307
|
|
Deemed contribution to Seadrill shareholders from non-controlling interest
|
19
|
|
16
|
|
105
|
|
69
|
|
209
|
|
(In millions of US$)
|
|
As at December 31, 2015
|
|
West Rigel newbuild investment, classified as held for sale
|
|
210
|
|
Loss on disposal
|
|
(82
|
)
|
Non-current assets held for sale
|
|
128
|
|
(In US$ millions)
|
|
As at December 31, 2014
|
|
ASSETS
|
|
|
|
Current assets
|
|
|
|
Cash and cash equivalents
|
|
27
|
|
Accounts receivables, net
|
|
78
|
|
Deferred tax assets
|
|
9
|
|
Other current assets
|
|
20
|
|
Total current assets
|
|
134
|
|
|
|
|
|
Non-current assets
|
|
|
|
Drilling units
|
|
965
|
|
Deferred tax assets LT
|
|
5
|
|
Goodwill
|
|
49
|
|
Other non-current assets
|
|
86
|
|
Total non-current assets
|
|
1,105
|
|
Total assets
|
|
1,239
|
|
|
|
|
|
LIABILITIES
|
|
|
|
Current liabilities
|
|
|
|
Trade accounts payable
|
|
(2
|
)
|
Other current liabilities
|
|
(56
|
)
|
Total current liabilities
|
|
(58
|
)
|
|
|
|
|
Non-current liabilities
|
|
|
|
Other non-current liabilities
|
|
(50
|
)
|
Total non-current liabilities
|
|
(50
|
)
|
Total liabilities
|
|
(108
|
)
|
(In US$ millions) |
December 31, 2015
|
|
|
December 31, 2014
|
|
|
December 31, 2013
|
|
Non-cash investing activities
|
|
|
|
|
|
|||
Disposal of subsidiaries - existing bank loan repaid (1)
|
150
|
|
|
—
|
|
|
—
|
|
Disposal of West Auriga - consideration received as a loan note (2)
|
—
|
|
|
100
|
|
|
—
|
|
Disposal of West Vela - deferred consideration receivable (2)
|
—
|
|
|
74
|
|
|
—
|
|
Disposal of tender rig business - deferred consideration received in shares (2)
|
|
|
—
|
|
|
416
|
|
|
Disposal of tender rig business - deferred consideration in receivables (2)
|
|
|
—
|
|
|
145
|
|
|
Acquisition of Archer shares, settled against existing related party loan (3)
|
—
|
|
|
—
|
|
|
55
|
|
Acquisition of AOD shares, settled against existing related party loan (4)
|
—
|
|
|
—
|
|
|
67
|
|
Non-cash financing activities
|
|
|
|
|
|
|||
Repayment of bank loan through disposal of subsidiaries (1)
|
(150
|
)
|
|
—
|
|
|
—
|
|
Repayment relating to share forward contracts and other derivatives (5)
|
(136
|
)
|
|
—
|
|
|
—
|
|
Repayment relating to SapuraKencana financing agreements (6)
|
(93
|
)
|
|
—
|
|
|
—
|
|
Conversion of convertible bond into shares, decrease in long term debt (7)
|
—
|
|
|
584
|
|
|
—
|
|
Conversion of convertible bond into shares, net increase in equity (7)
|
—
|
|
|
615
|
|
|
—
|
|
Purchase of SFL Polaris, net increase in related party payables and net decrease in equity (8)
|
—
|
|
|
13
|
|
|
—
|
|
Dividend to non-controlling interests in VIEs (9)
|
—
|
|
|
—
|
|
|
223
|
|
1.
|
Existing debt of the Company was directly settled as consideration for the disposal of certain drilling rigs to the SeaMex joint venture - see
Note 5
to the consolidated financial statements included herein
,
for more details.
|
2.
|
Disposals of the
West Auriga
,
West Vela
, in 2014 and the disposal of the tender rig business in 2013 - refer to
Note 11
to the consolidated financial statements included herein
,
for more details.
|
3.
|
Private placement of Archer shares in February 2013 was settled against related party loan receivable - refer to
Note 17
to the consolidated financial statements included herein
,
for more details.
|
4.
|
Private placement of AOD shares in March 2013 was settled against elated party loan receivable - refer to
Note 17
to the consolidated financial statements included herein
,
for more details. -
|
5.
|
During the period, Company settled Sevan share repurchase agreements using cash balances already classified as restricted.
|
6.
|
During the period, the Company settled SapuraKencana financing agreements using cash balances already classified as restricted.
|
7.
|
In July 2014, the Company launched a voluntary incentive payment offer to convert any and all of the
$650 million
principal amount of
3.375%
convertible bonds. Holders converted at the contractual conversion price of
$27.69
per share and received an incentive payment of
$12,102.95
per
$100,000
principal amount of bond held. As a result of the transaction, the number of common shares outstanding in the Company increased by
23.8 million
shares, with an increase to equity of
$893 million
.
$278 million
of the total consideration transferred on conversion was allocated to the reacquisition of the embedded conversion option and recognized as a reduction of stockholders’ equity.
|
8.
|
Purchase of SFL Polaris from Ship Finance - refer to Note 35 - VIEs.
|
9.
|
Dividends declared by VIEs in 2013 to Ship Finance was settled against related party balances with Ship Finance - refer to Note 27 - Non-Controlling interests.
|
•
|
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
•
|
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Company's receipts and expenditures are being made only in accordance with authorizations of Company's management and directors; and
|
•
|
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Operating revenues
|
|
|
|
|
|
|
||||||
Contract revenues
|
|
$
|
1,603.6
|
|
|
$
|
1,302.7
|
|
|
$
|
1,047.1
|
|
Reimbursable revenues
|
|
49.9
|
|
|
39.9
|
|
|
11.4
|
|
|||
Other revenues
|
*
|
88.1
|
|
|
—
|
|
|
5.8
|
|
|||
Total operating revenues
|
|
1,741.6
|
|
|
1,342.6
|
|
|
1,064.3
|
|
|||
|
|
|
|
|
|
|
||||||
Operating expenses
|
|
|
|
|
|
|
||||||
Vessel and rig operating expenses
|
*
|
495.5
|
|
|
425.0
|
|
|
375.2
|
|
|||
Amortization of favorable contracts
|
|
66.9
|
|
|
14.8
|
|
|
—
|
|
|||
Reimbursable expenses
|
|
45.7
|
|
|
37.9
|
|
|
10.6
|
|
|||
Depreciation and amortization
|
|
237.5
|
|
|
198.7
|
|
|
141.2
|
|
|||
General and administrative expenses
|
*
|
52.3
|
|
|
51.4
|
|
|
49.6
|
|
|||
Total operating expenses
|
|
897.9
|
|
|
727.8
|
|
|
576.6
|
|
|||
|
|
|
|
|
|
|
||||||
Operating income
|
|
843.7
|
|
|
614.8
|
|
|
487.7
|
|
|||
|
|
|
|
|
|
|
||||||
Financial items
|
|
|
|
|
|
|
||||||
Interest income
|
|
9.8
|
|
|
3.7
|
|
|
4.4
|
|
|||
Interest expense
|
*
|
(192.5
|
)
|
|
(140.9
|
)
|
|
(92.2
|
)
|
|||
(Loss)/gain on derivative financial instruments
|
*
|
(82.9
|
)
|
|
(124.9
|
)
|
|
49.9
|
|
|||
Currency exchange gain / (loss)
|
|
1.6
|
|
|
(3.3
|
)
|
|
(1.2
|
)
|
|||
Gain on bargain purchase
|
*
|
9.3
|
|
|
—
|
|
|
—
|
|
|||
Total financial items
|
|
(254.7
|
)
|
|
(265.4
|
)
|
|
(39.1
|
)
|
|||
|
|
|
|
|
|
|
||||||
Income before income taxes
|
|
589.0
|
|
|
349.4
|
|
|
448.6
|
|
|||
Income taxes
|
|
(100.6
|
)
|
|
(34.8
|
)
|
|
(33.2
|
)
|
|||
Net income
|
|
$
|
488.4
|
|
|
$
|
314.6
|
|
|
$
|
415.4
|
|
Net income attributable to the non-controlling interest
|
|
(231.2
|
)
|
|
(176.4
|
)
|
|
(271.0
|
)
|
|||
Net income attributable to Seadrill Partners LLC owners
|
|
$
|
257.2
|
|
|
$
|
138.2
|
|
|
$
|
144.4
|
|
|
|
|
|
|
|
|
||||||
Earnings per unit (basic and diluted)
|
|
|
|
|
|
|
||||||
Common unitholders
|
|
$
|
2.45
|
|
|
$
|
1.75
|
|
|
$
|
2.15
|
|
Subordinated unitholders
|
|
$
|
2.45
|
|
|
$
|
1.75
|
|
|
$
|
1.83
|
|
|
|
2015
|
|
2014
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
319.0
|
|
|
$
|
242.7
|
|
Accounts receivables, net
|
|
278.3
|
|
|
294.5
|
|
||
Amount due from related party
|
|
128.1
|
|
|
62.7
|
|
||
Other current assets
|
|
166.6
|
|
|
129.3
|
|
||
Total current assets
|
|
892.0
|
|
|
729.2
|
|
||
Non-current assets:
|
|
|
|
|
||||
Drilling units
|
|
5,547.3
|
|
|
5,141.1
|
|
||
Goodwill
|
|
3.2
|
|
|
3.2
|
|
||
Deferred tax assets
|
|
34.2
|
|
|
18.4
|
|
||
Amount due from related party
|
|
50.0
|
|
|
—
|
|
||
Other non-current assets
|
|
314.4
|
|
|
376.2
|
|
||
Total non-current assets
|
|
5,949.1
|
|
|
5,538.9
|
|
||
Total assets
|
|
$
|
6,841.1
|
|
|
$
|
6,268.1
|
|
|
|
|
|
|
||||
LIABILITIES AND MEMBERS’ CAPITAL
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Current portion of long-term debt
|
|
$
|
93.8
|
|
|
$
|
68.9
|
|
Current portion of long-term related party debt
|
|
145.8
|
|
|
40.4
|
|
||
Trade accounts payable and accruals
|
|
24.1
|
|
|
7.9
|
|
||
Current portion of deferred and contingent consideration to related party
|
|
60.4
|
|
|
25.8
|
|
||
Related party payable
|
|
304.7
|
|
|
250.0
|
|
||
Other current liabilities
|
|
217.9
|
|
|
227.4
|
|
||
Total current liabilities
|
|
846.7
|
|
|
620.4
|
|
||
Non-current liabilities:
|
|
|
|
|
||||
Long-term debt
|
|
3,440.4
|
|
|
3,156.6
|
|
||
Long-term related party debt
|
|
160.2
|
|
|
306.1
|
|
||
Deferred and contingent consideration to related party
|
|
185.4
|
|
|
111.2
|
|
||
Deferred tax liability
|
|
43.7
|
|
|
—
|
|
||
Long-term related party payable
|
|
50.0
|
|
|
—
|
|
||
Other non-current liabilities
|
|
17.3
|
|
|
29.5
|
|
||
Total non-current liabilities
|
|
3,897.0
|
|
|
3,603.4
|
|
||
|
|
|
|
|
||||
Commitments and contingencies (see note 15)
|
|
—
|
|
|
—
|
|
||
Equity
|
|
|
|
|
||||
Members’ Capital:
|
|
|
|
|
||||
Common unitholders (issued 75,278,250 units)
|
|
945.5
|
|
|
913.3
|
|
||
Subordinated unitholders (issued 16,543,350 units)
|
|
18.7
|
|
|
11.7
|
|
||
Seadrill member interest
|
|
—
|
|
|
3.2
|
|
||
Total members’ capital
|
|
964.3
|
|
|
928.2
|
|
||
Non-controlling interest
|
|
1,133.1
|
|
|
1,116.1
|
|
||
Total equity
|
|
2,097.4
|
|
|
2,044.3
|
|
||
Total liabilities and equity
|
|
$
|
6,841.1
|
|
|
$
|
6,268.1
|
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Cash Flows from Operating Activities
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
488.4
|
|
|
$
|
314.6
|
|
|
$
|
415.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization
|
|
237.5
|
|
|
198.7
|
|
|
141.2
|
|
|||
Amortization of deferred loan charges
|
|
20.2
|
|
|
17.6
|
|
|
7.1
|
|
|||
Amortization of favorable contracts
|
|
66.9
|
|
|
14.8
|
|
|
—
|
|
|||
Gain on bargain purchase
|
|
(9.3
|
)
|
|
—
|
|
|
—
|
|
|||
Unrealized loss / (gain) related to derivative financial instruments
|
|
31.8
|
|
|
99.1
|
|
|
(60.2
|
)
|
|||
Unrealized foreign exchange gain
|
|
(1.7
|
)
|
|
—
|
|
|
—
|
|
|||
Payment for long term maintenance
|
|
(49.8
|
)
|
|
(39.1
|
)
|
|
(26.5
|
)
|
|||
Deferred income tax (benefit) / expense
|
|
27.9
|
|
|
(8.6
|
)
|
|
(9.2
|
)
|
|||
West Aquarius
settlement
|
|
—
|
|
|
—
|
|
|
25.0
|
|
|||
Accretion of discount on deferred consideration
|
|
13.3
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities, net of effect of acquisitions
|
|
|
|
|
|
|
||||||
Trade accounts receivable
|
|
49.8
|
|
|
(46.3
|
)
|
|
(9.4
|
)
|
|||
Prepaid expenses and accrued income
|
|
(1.9
|
)
|
|
—
|
|
|
—
|
|
|||
Trade accounts payable
|
|
15.3
|
|
|
(10.7
|
)
|
|
48.6
|
|
|||
Related party balances
|
|
(29.0
|
)
|
|
31.4
|
|
|
56.9
|
|
|||
Other assets
|
|
57.9
|
|
|
9.9
|
|
|
2.0
|
|
|||
Other liabilities
|
|
(45.0
|
)
|
|
41.7
|
|
|
(14.0
|
)
|
|||
Changes in deferred revenue
|
|
(12.0
|
)
|
|
(14.4
|
)
|
|
(12.9
|
)
|
|||
Other, net
|
|
(0.5
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash provided by operating activities
|
|
$
|
859.8
|
|
|
$
|
608.7
|
|
|
$
|
564.0
|
|
|
|
|
|
|
|
|
||||||
Cash Flows from Investing Activities
|
|
|
|
|
|
|
||||||
Additions to newbuildings and drilling units
|
|
(18.6
|
)
|
|
(31.6
|
)
|
|
(159.3
|
)
|
|||
Acquisition of subsidiaries, net of cash acquired
|
|
(214.7
|
)
|
|
(1,137.7
|
)
|
|
—
|
|
|||
Loan granted to related parties
|
|
(143.0
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of non-controlling interest in Seadrill Operating LP
|
|
—
|
|
|
(373.5
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
|
$
|
(376.3
|
)
|
|
$
|
(1,542.8
|
)
|
|
$
|
(159.3
|
)
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Cash Flows from Financing Activities
|
|
|
|
|
|
|
||||||
Net proceeds from long term debt
|
|
$
|
—
|
|
|
$
|
2,825.4
|
|
|
$
|
98.0
|
|
Repayments of long term debt
|
|
(97.6
|
)
|
|
(472.1
|
)
|
|
(348.8
|
)
|
|||
Debt fees paid
|
|
(0.8
|
)
|
|
—
|
|
|
—
|
|
|||
Net proceeds from related party debt
|
|
143.0
|
|
|
—
|
|
|
409.5
|
|
|||
Repayments of related party debt
|
|
(40.3
|
)
|
|
(1,588.3
|
)
|
|
|
||||
Proceeds from revolving credit facility
|
|
50.0
|
|
|
—
|
|
|
169.6
|
|
|||
Contingent consideration paid
|
|
(26.6
|
)
|
|
—
|
|
|
—
|
|
|||
Repayments of revolving credit facility
|
|
—
|
|
|
(125.9
|
)
|
|
(43.7
|
)
|
|||
Repayments of related party discount notes
|
|
—
|
|
|
(399.9
|
)
|
|
—
|
|
|||
Cash distributions
|
|
(435.3
|
)
|
|
(660.2
|
)
|
|
(140.9
|
)
|
|||
Proceeds on issuance of equity, net of fees
|
|
—
|
|
|
937.8
|
|
|
464.8
|
|
|||
Proceeds on issuance of equity to related parties
|
|
—
|
|
|
—
|
|
|
106.9
|
|
|||
Proceeds on issuance of units by Seadrill Capricorn Holdings LLC
|
|
—
|
|
|
570.3
|
|
|
—
|
|
|||
Distribution to Seadrill Limited for the acquisition of
T-15, T-16, West Leo
and
West
Sirius
(1)
|
|
—
|
|
|
—
|
|
|
(939.2
|
)
|
|||
Owner’s funding repaid
|
|
—
|
|
|
—
|
|
|
(112.4
|
)
|
|||
Net cash provided by/ (used in) financing activities
|
|
$
|
(407.6
|
)
|
|
$
|
1,087.1
|
|
|
$
|
(336.2
|
)
|
|
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
Net increase in cash and cash equivalents
|
|
76.3
|
|
|
153.0
|
|
|
68.5
|
|
|||
Cash and cash equivalents at beginning of the year
|
|
242.7
|
|
|
89.7
|
|
|
21.2
|
|
|||
Cash and cash equivalents at the end of year
|
|
$
|
319.0
|
|
|
$
|
242.7
|
|
|
$
|
89.7
|
|
|
|
|
|
|
|
|
||||||
Supplementary disclosure of cash flow information
|
|
|
|
|
|
|
||||||
Interest paid net of capitalized interest
|
|
$
|
228.6
|
|
|
$
|
128.3
|
|
|
$
|
92.2
|
|
Taxes paid
|
|
57.0
|
|
|
42.6
|
|
|
35.1
|
|
|
|
Members’ Capital
|
|
|
|
|
|
|
||||||||||||||||
|
|
Common
Units
|
|
Subordinated
Units
|
|
Seadrill
Member
|
|
Total Before
Non-
Controlling
interest
|
|
Non-
controlling
Interest
|
|
Total
Equity |
||||||||||||
Consolidated and Combined Balance at December 31, 2012
|
|
$
|
294.1
|
|
|
$
|
3.7
|
|
|
$
|
226.8
|
|
|
$
|
524.6
|
|
|
$
|
899.8
|
|
|
$
|
1,424.4
|
|
Movement in invested equity
|
|
—
|
|
|
—
|
|
|
(62.3
|
)
|
|
(62.3
|
)
|
|
(50.1
|
)
|
|
(112.4
|
)
|
||||||
Acquisition of dropdown companies from Seadrill
|
|
—
|
|
|
—
|
|
|
(831.5
|
)
|
|
(831.5
|
)
|
|
(962.5
|
)
|
|
(1,794.0
|
)
|
||||||
Deemed distribution to Seadrill for the acquisition of dropdown companies
|
|
—
|
|
|
—
|
|
|
609.7
|
|
|
609.7
|
|
|
696.9
|
|
|
1,306.6
|
|
||||||
Allocation of deemed distribution to Seadrill for the acquisition of dropdown companies
|
|
(609.7
|
)
|
|
—
|
|
|
—
|
|
|
(609.7
|
)
|
|
(696.9
|
)
|
|
(1,306.6
|
)
|
||||||
Equity contribution from Seadrill to Seadrill Operating LP
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
511.1
|
|
|
511.1
|
|
||||||
Units issued by Seadrill Capricorn Holdings LLC to Seadrill Limited
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
338.8
|
|
|
338.8
|
|
||||||
Common units issued to Seadrill for the acquisition of the T-16
|
|
106.9
|
|
|
—
|
|
|
—
|
|
|
106.9
|
|
|
—
|
|
|
106.9
|
|
||||||
Common units issued to Seadrill and public - (net of transaction costs of $15.3m)
|
|
464.8
|
|
|
—
|
|
|
—
|
|
|
464.8
|
|
|
—
|
|
|
464.8
|
|
||||||
Capital injection due to forgiveness of related party payables
|
|
9.9
|
|
|
6.6
|
|
|
—
|
|
|
16.5
|
|
|
24.0
|
|
|
40.5
|
|
||||||
Consolidated and Combined carve-out net income
|
|
53.4
|
|
|
33.7
|
|
|
57.3
|
|
|
144.4
|
|
|
271.0
|
|
|
415.4
|
|
||||||
Cash Distributions paid
|
|
(39.2
|
)
|
|
(25.2
|
)
|
|
—
|
|
|
(64.4
|
)
|
|
(76.5
|
)
|
|
(140.9
|
)
|
||||||
Consolidated Balance at December 31, 2013
|
|
$
|
280.2
|
|
|
$
|
18.8
|
|
|
$
|
—
|
|
|
$
|
299.0
|
|
|
$
|
955.6
|
|
|
$
|
1,254.6
|
|
Purchase of non-controlling interest
|
|
(279.6
|
)
|
|
—
|
|
|
—
|
|
|
(279.6
|
)
|
|
(93.2
|
)
|
|
(372.8
|
)
|
||||||
Common units issued to Seadrill and public (net of transaction costs)
|
|
937.8
|
|
|
—
|
|
|
—
|
|
|
937.8
|
|
|
—
|
|
|
937.8
|
|
||||||
Contribution from non-controlling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
570.3
|
|
|
570.3
|
|
||||||
Net income
|
|
102.2
|
|
|
26.8
|
|
|
9.2
|
|
|
138.2
|
|
|
176.4
|
|
|
314.6
|
|
||||||
Cash Distributions
|
|
(127.3
|
)
|
|
(33.9
|
)
|
|
(6.0
|
)
|
|
(167.2
|
)
|
|
(493.0
|
)
|
|
(660.2
|
)
|
||||||
Consolidated Balance at December 31, 2014
|
|
$
|
913.3
|
|
|
$
|
11.7
|
|
|
$
|
3.2
|
|
|
$
|
928.2
|
|
|
$
|
1,116.1
|
|
|
$
|
2,044.3
|
|
Net income
|
|
$
|
203.0
|
|
|
$
|
44.6
|
|
|
$
|
9.5
|
|
|
$
|
257.2
|
|
|
$
|
231.2
|
|
|
$
|
488.4
|
|
Cash Distributions
|
|
$
|
(170.8
|
)
|
|
$
|
(37.6
|
)
|
|
$
|
(12.7
|
)
|
|
$
|
(221.1
|
)
|
|
$
|
(214.2
|
)
|
|
$
|
(435.3
|
)
|
Consolidated balance at December 31, 2015
|
|
$
|
945.5
|
|
|
$
|
18.7
|
|
|
$
|
—
|
|
|
$
|
964.3
|
|
|
$
|
1,133.1
|
|
|
$
|
2,097.4
|
|
(In US$ millions)
|
June 19, 2015
|
|
Consideration
|
|
|
Cash
|
204.0
|
|
Contingent consideration
|
95.3
|
|
Seller's Credit
|
44.6
|
|
Plus: Working capital adjustment
|
30.7
|
|
Fair value of total consideration transferred
|
374.6
|
|
|
|
|
Recognized amounts of identifiable assets acquired and liabilities assumed at estimated fair value
|
|
|
Cash
|
20.0
|
|
Current assets
|
52.1
|
|
Intangible asset - favorable drilling contract
|
124.3
|
|
Drilling unit
|
575.3
|
|
Long term interest bearing debt
|
(336.0
|
)
|
Current liabilities
|
(20.2
|
)
|
Non-current liabilities
|
(1.3
|
)
|
Total identifiable net assets at acquisition
|
414.2
|
|
|
|
|
Measurement period adjustment
|
(30.3
|
)
|
Gain on bargain purchase
|
(9.3
|
)
|
Total
|
374.6
|
|
|
Year ended December 31,
|
||||||||||||||
(In US$ millions)
|
2015
|
|
2014
|
||||||||||||
|
Seadrill Partners LLC as reported
|
|
Supplemental pro forma combined entity
|
|
Seadrill Partners LLC as reported
|
|
Supplemental pro forma combined entity
|
||||||||
Total Revenue
|
$
|
1,741.6
|
|
|
$
|
1,851.3
|
|
|
$
|
1,342.6
|
|
|
$
|
1,564.1
|
|
Net Income
|
488.4
|
|
|
535.7
|
|
|
314.6
|
|
|
388.9
|
|
||||
Net income attributable to Seadrill Partners LLC members
|
257.2
|
|
|
284.6
|
|
|
138.2
|
|
|
181.3
|
|
(In US$ millions)
|
March 21, 2014
|
|
Consideration
|
|
|
Cash
|
696.9
|
|
Discount note issued
|
100.0
|
|
Working capital adjustment
|
(330.4
|
)
|
Fair value of total consideration transferred
|
466.5
|
|
|
|
|
Recognized amounts of identifiable assets acquired and liabilities assumed at estimated fair value
|
|
|
Cash
|
24.4
|
|
Current assets
|
44.4
|
|
Intangible asset - favorable drilling contract
|
76.2
|
|
Drilling unit
|
1,065.7
|
|
Non current assets
|
76.6
|
|
Long term interest bearing debt
|
(443.1
|
)
|
Current liabilities
|
(380.6
|
)
|
Total identifiable net assets
|
463.6
|
|
|
|
|
Goodwill
|
2.9
|
|
Total
|
466.5
|
|
|
Year ended December 31,
|
||||||||||
(In US$ millions)
|
2014
|
|
2013
|
||||||||
|
Seadrill Partners LLC as reported
|
|
Supplemental pro forma combined entity
|
|
Seadrill Partners LLC as reported
|
|
Supplemental pro forma combined entity
|
||||
Revenues
|
1,342.6
|
|
|
1,390.7
|
|
|
1,064.3
|
|
|
1,096.1
|
|
Net Income
|
314.6
|
|
|
331.0
|
|
|
415.4
|
|
|
412.5
|
|
(In US$ millions)
|
November 4, 2014
|
|
Consideration
|
|
|
Cash
|
467.0
|
|
Mobilization payable
|
73.7
|
|
Contingent consideration
|
65.7
|
|
Less: Working capital adjustment
|
(6.0
|
)
|
Fair value of total consideration transferred
|
600.4
|
|
|
|
|
Recognized amounts of identifiable assets acquired and liabilities assumed at estimated fair value
|
|
|
Cash
|
1.9
|
|
Current assets
|
61.4
|
|
Intangible asset - favorable drilling contract
|
204.7
|
|
Drilling unit
|
755.8
|
|
Non current assets
|
61.8
|
|
Long term interest bearing debt
|
(433.1
|
)
|
Current liabilities
|
(52.3
|
)
|
Total identifiable net assets
|
600.2
|
|
|
|
|
Goodwill
|
0.2
|
|
Total
|
600.4
|
|
|
Year ended December 31,
|
||||||||||
(In US$ millions)
|
2014
|
|
2013
|
||||||||
|
Seadrill Partners LLC as reported
|
|
Supplemental pro forma combined entity
|
|
Seadrill Partners LLC as reported
|
|
Supplemental pro forma combined entity
|
||||
Revenues
|
1,342.6
|
|
|
1,532.4
|
|
|
1,064.3
|
|
|
1,083.4
|
|
Net Income
|
314.6
|
|
|
407.6
|
|
|
415.4
|
|
|
403.8
|
|
(In US$ millions)
|
|
T-15
|
|
T-16
|
|
West Sirius
|
|
West Leo
|
|
Total
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|||||
Total purchase price
|
|
210.0
|
|
|
200.0
|
|
|
1,035.0
|
|
|
1,250.0
|
|
|
2,695.0
|
|
Debt assumed
|
|
(100.5
|
)
|
|
(93.1
|
)
|
|
(220.2
|
)
|
|
(485.0
|
)
|
|
(898.8
|
)
|
Purchase price less debt
|
|
109.5
|
|
|
106.9
|
|
|
814.8
|
|
|
765.0
|
|
|
1,796.2
|
|
Working capital adjustments
|
|
(34.9
|
)
|
|
(39.0
|
)
|
|
106.7
|
|
|
(35.0
|
)
|
|
(2.2
|
)
|
Adjusted purchase price
|
|
74.6
|
|
|
67.9
|
|
|
921.5
|
|
|
730.0
|
|
|
1,794.0
|
|
Carrying value of net assets / (liabilities) acquired
|
|
(4.8
|
)
|
|
0.3
|
|
|
374.6
|
|
|
117.3
|
|
|
487.4
|
|
Excess of sales price over net assets acquired
|
|
79.4
|
|
|
67.6
|
|
|
546.9
|
|
|
612.7
|
|
|
1,306.6
|
|
|
2015
|
|
2014
|
|
2013
|
|||
BP
|
44.8
|
%
|
|
41.5
|
%
|
|
35.0
|
%
|
ExxonMobil *
|
32.1
|
%
|
|
26.4
|
%
|
|
14.5
|
%
|
Tullow
|
13.5
|
%
|
|
17.4
|
%
|
|
18.8
|
%
|
Chevron
|
8.5
|
%
|
|
14.7
|
%
|
|
12.1
|
%
|
Total
|
—
|
%
|
|
—
|
%
|
|
19.6
|
%
|
Other
|
1.1
|
%
|
|
—
|
%
|
|
—
|
%
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
||||||
United States
|
$
|
781.1
|
|
|
$
|
556.6
|
|
|
$
|
370.4
|
|
Nigeria
|
250.1
|
|
|
228.5
|
|
|
213.3
|
|
|||
Ghana
|
234.7
|
|
|
233.5
|
|
|
198.6
|
|
|||
Canada
|
190.9
|
|
|
126.1
|
|
|
153.5
|
|
|||
Angola
|
179.4
|
|
|
92.3
|
|
|
87.9
|
|
|||
Thailand
|
99.8
|
|
|
105.6
|
|
|
40.6
|
|
|||
Other
|
5.6
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
1,741.6
|
|
|
$
|
1,342.6
|
|
|
$
|
1,064.3
|
|
(In US$ millions)
|
2015
|
|
2014
|
||||
United States
|
$
|
2,927.4
|
|
|
$
|
3,024.3
|
|
Ghana
|
591.5
|
|
|
608.4
|
|
||
Angola
|
571.3
|
|
|
182.5
|
|
||
Canada
|
519.2
|
|
|
539.3
|
|
||
Nigeria
|
508.0
|
|
|
525.4
|
|
||
Thailand
|
251.5
|
|
|
261.2
|
|
||
Myanmar
|
178.4
|
|
|
—
|
|
||
Total
|
$
|
5,547.3
|
|
|
$
|
5,141.1
|
|
(1)
|
The fixed assets referred to in the table above include the eleven drilling units at December 31, 2015 and ten drilling units at December 31, 2014. Asset locations at the end of a period are not necessarily indicative of the geographic distribution of the revenues or operating profits generated by such assets during such period.
|
|
Year Ended December 31,
|
|||||||
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Current tax expense:
|
|
|
|
|
|
|||
United Kingdom
|
—
|
|
|
—
|
|
|
—
|
|
Foreign
|
72.6
|
|
|
43.5
|
|
|
42.4
|
|
Total current tax expense
|
72.6
|
|
|
43.5
|
|
|
42.4
|
|
Deferred tax (benefit) expense:
|
|
|
|
|
|
|||
United Kingdom
|
—
|
|
|
—
|
|
|
—
|
|
Foreign
|
28.0
|
|
|
(8.7
|
)
|
|
(9.2
|
)
|
Total income tax expense
|
100.6
|
|
|
34.8
|
|
|
33.2
|
|
|
2015
|
|
2014
|
|
2013
|
|||
U.K. statutory income tax rate
|
20.3
|
%
|
|
21.3
|
%
|
|
23.3
|
%
|
Non-U.K. taxes
|
(3.2
|
)%
|
|
(11.3
|
)%
|
|
(15.8
|
)%
|
Effective income tax rate
|
17.1
|
%
|
|
10.0
|
%
|
|
7.5
|
%
|
(In US$ millions)
|
2015
|
|
2014
|
||
Long-term deferred tax asset
|
34.2
|
|
|
18.4
|
|
Long-term deferred tax liability
|
(43.7
|
)
|
|
—
|
|
Net deferred tax (liability) / asset
|
(9.5
|
)
|
|
18.4
|
|
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Balance beginning of period
|
—
|
|
|
—
|
|
|
—
|
|
Increases as a result of positions taken in prior periods
|
—
|
|
|
—
|
|
|
—
|
|
Increases as a result of positions taken during the current period
|
9.0
|
|
|
—
|
|
|
—
|
|
Decreases as a result of positions taken in prior periods
|
—
|
|
|
—
|
|
|
—
|
|
Decreases as a result of positions taken in the current period
|
—
|
|
|
—
|
|
|
—
|
|
Balance end of period
|
9.0
|
|
|
—
|
|
|
—
|
|
|
Year Ended December 31,
|
|||||||
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Termination payments revenue
|
74.7
|
|
|
—
|
|
|
—
|
|
Related party other revenues
|
13.4
|
|
|
—
|
|
|
5.8
|
|
Total
|
88.1
|
|
|
—
|
|
|
5.8
|
|
(In US$ millions)
|
December 31,
2015 |
|
December 31,
2014 |
||
Reimbursable amounts due from customers
|
23.5
|
|
|
18.5
|
|
Mobilization revenue receivable - short-term
|
42.0
|
|
|
42.0
|
|
Favorable contracts to be amortized - short-term
|
70.5
|
|
|
40.5
|
|
Insurance receivable
|
12.1
|
|
|
14.9
|
|
Prepaid expenses
|
13.1
|
|
|
11.2
|
|
Other
|
5.4
|
|
|
2.2
|
|
Total other current assets
|
166.6
|
|
|
129.3
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net carrying amount
|
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net carrying amount
|
||||||
Favorable contracts - intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance at beginning of period
|
280.9
|
|
|
(14.8
|
)
|
|
266.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Additions *
|
76.4
|
|
|
—
|
|
|
76.4
|
|
|
280.9
|
|
|
—
|
|
|
280.9
|
|
Amortization of favorable contracts
|
—
|
|
|
(66.9
|
)
|
|
(66.9
|
)
|
|
—
|
|
|
(14.8
|
)
|
|
(14.8
|
)
|
Balance at end of period
|
357.3
|
|
|
(81.7
|
)
|
|
275.6
|
|
|
280.9
|
|
|
(14.8
|
)
|
|
266.1
|
|
|
Year ended December 31
|
||||||||||||||||
(In US$ millions)
|
2016
|
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
Total
|
|
Amortization of favorable contracts
|
70.5
|
|
|
70.5
|
|
|
50.6
|
|
|
45.6
|
|
|
38.4
|
|
|
275.6
|
|
(In US$ millions)
|
December 31,
2015 |
|
December 31,
2014 |
||
Cost
|
6,434.2
|
|
|
5,790.5
|
|
Accumulated depreciation
|
(886.9
|
)
|
|
(649.4
|
)
|
Net book value
|
5,547.3
|
|
|
5,141.1
|
|
(In US$ millions)
|
December 31,
2015 |
|
December 31,
2014 |
||
Mobilization revenue receivable - long-term portion
|
109.2
|
|
|
150.6
|
|
Favorable contract – long-term portion
|
205.2
|
|
|
225.6
|
|
Total other non-current assets
|
314.4
|
|
|
376.2
|
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
External debt agreements
|
|
|
|
||
Amended Senior Secured Credit Facilities
|
2,894.7
|
|
|
2,881.0
|
|
$1,450 Senior Secured Credit Facility
|
382.6
|
|
|
422.9
|
|
$420 West Polaris Facility
|
315.0
|
|
|
—
|
|
Sub-total external debt
|
3,592.3
|
|
|
3,303.9
|
|
Less current portion long term external debt
|
(105.3
|
)
|
|
(76.5
|
)
|
Long-term external debt
|
3,487.0
|
|
|
3,227.4
|
|
|
|
|
|
||
Related party debt agreements
|
|
|
|
||
Rig Financing and Loan Agreements
|
|
|
|
||
West Vencedor
Loan Agreement (previously $1,200 facility)
|
57.5
|
|
|
78.2
|
|
$440 Rig Financing Agreement
|
139.0
|
|
|
158.8
|
|
Sub-total Rig Financing Agreements
|
196.5
|
|
|
237.0
|
|
|
|
|
|
||
Other related party debt
|
|
|
|
||
$109.5 T-15 vendor financing facility
|
109.5
|
|
|
109.5
|
|
Total related party debt
|
306.0
|
|
|
346.5
|
|
Less current portion of related party debt
|
(145.8
|
)
|
|
(40.4
|
)
|
Long-term related party debt and related party loan notes
|
160.2
|
|
|
306.1
|
|
|
|
|
|
||
Total external and related party debt
|
3,898.3
|
|
|
3,650.4
|
|
|
|
Outstanding debt as of December 31, 2015
|
||||||||
(In $ millions)
|
|
Principal outstanding
|
|
Debt Issuance Costs
|
|
Total Debt
|
|
|||
Current portion of long-term external debt
|
|
$
|
105.3
|
|
$
|
(11.5
|
)
|
$
|
93.8
|
|
Long-term external debt
|
|
3,487.0
|
|
(46.6
|
)
|
3,440.4
|
|
|||
Total external debt
|
|
$
|
3,592.3
|
|
$
|
(58.1
|
)
|
$
|
3,534.2
|
|
|
|
Outstanding debt as of December 31, 2014
|
||||||||
(In $ millions)
|
|
Principal outstanding
|
|
Debt Issuance Costs
|
|
Total Debt
|
|
|||
Current portion of long-term external debt
|
|
$
|
76.5
|
|
$
|
(7.6
|
)
|
$
|
68.9
|
|
Long-term external debt
|
|
3,227.4
|
|
(70.8
|
)
|
3,156.6
|
|
|||
Total external debt
|
|
$
|
3,303.9
|
|
$
|
(78.4
|
)
|
$
|
3,225.5
|
|
•
|
Limitations on the incurrence of indebtedness and issuance of preferred equity;
|
•
|
Limitations on the incurrence of liens;
|
•
|
Limitations on dividends and other restricted payments;
|
•
|
Limitations on investments;
|
•
|
Limitations on mergers, consolidation and sales of all or substantially all assets;
|
•
|
Limitations on asset sales;
|
•
|
Limitations on transactions with affiliates;
|
•
|
Limitation on business activities to businesses similar to those now being conducted; and
|
•
|
Requirement to maintain a senior secured net leverage ratio of no more than 5.5 to 1.0 (5.0 to 1.0 for the fiscal quarter ending March 31, 2015 and thereafter).
|
•
|
Failure of any borrow of the term loan to pay principal, interest or other amounts owing with respect to the loans under the Amended Senior Secured Credit Facilities;
|
•
|
Breach in any material respect of any representation or warranty contained in Amended Senior Secured Credit Facilities documentation;
|
•
|
Breach of any covenant contained in Amended Senior Secured Credit Facilities documentation;
|
•
|
The occurrence of a payment default under, or acceleration of, any indebtedness aggregating $25 million or more other than the term loan;
|
•
|
Failure by our subsidiaries that are borrowers or guarantors of our Amended Senior Secured Credit Facilities to pay or stay any judgment in excess of $25 million;
|
•
|
Repudiation by our subsidiaries that are borrowers or guarantors of our Amended Senior Secured Credit Facilities of any guarantee or collateral documents related to the Amended Senior Secured Credit Facilities;
|
•
|
Any guarantee related to the Amended Senior Secured Credit Facilities is found to be unenforceable or invalid or is not otherwise effective;
|
•
|
Any of our subsidiaries that are borrowers or guarantors of our Amended Senior Secured Credit Facilities file for bankruptcy or become the subject of an involuntary bankruptcy case or other similar proceeding;
|
•
|
The equity interests of any of the company, Seadrill Operating LP or Seadrill Capricorn Holdings LLC is pledged to anyone other than the collateral agent for the term loan; and
|
•
|
The occurrence of a change of control.
|
•
|
sell the applicable drilling unit;
|
•
|
incur additional indebtedness or guarantee other indebtedness;
|
•
|
make investments or acquisitions;
|
•
|
pay dividends or make any other distributions if an event of default occurs; or
|
•
|
enter into inter-company charter arrangements for the drilling units not contemplated by the applicable Rig Facility.
|
•
|
Aggregated minimum liquidity requirement for Seadrill's consolidated group: to maintain cash and cash equivalents of at least $150 million within the group.
|
•
|
Interest coverage ratio: to maintain an EBITDA to interest expense ratio of at least 2.5:1.
|
•
|
Current ratio: to maintain current assets to current liabilities ratio of at least 1:1. Current assets are defined as book value less minimum liquidity, but including up to 20.0% of shares in listed companies owned 20.0% or more. Current liabilities are defined as book value less the current portion of long term debt.
|
•
|
Equity to asset ratio: to maintain total equity to total assets ratio of at least 30.0%. Both equity and total assets are adjusted for the difference between book and market values of drilling units.
|
•
|
Leverage ratio: to maintain a ratio of net debt to EBITDA no greater than 4.5:1, up to the effective date of the amended covenants discussed further below. Net debt is calculated as all interest bearing debt less cash and cash equivalents excluding minimum liquidity requirements.
|
•
|
6.0:1, from and including the financial quarter starting on July 1, 2015 and including the financial quarter ending on September 30, 2016;
|
•
|
5.5:1, from and including the financial quarter starting on October 1, 2016 and including the financial quarter ending December 31, 2016;
|
•
|
4.5:1, from and including the financial quarter starting on January 1, 2017 until the final maturity date.
|
•
|
.125 percent per annum if the leverage ratio is 4.50:1 up to and including 4.99:1;
|
•
|
.25 percent per annum if the leverage ratio is 5.00:1 up to and including 5.49:1;
|
•
|
.75 percent per annum if the leverage ratio is 5.50:1 up to and including 6.00:1
|
•
|
total loss or sale of a drilling unit securing a Rig Financing Agreements;
|
•
|
cancellation or termination of any existing charter contract or satisfactory drilling contract; and
|
•
|
a change of control.
|
•
|
failure to comply with the financial or insurance covenants;
|
•
|
cross-default to other indebtedness held by both Seadrill and its subsidiaries and by the Company;
|
•
|
failure by Seadrill or by the Company to remain listed on a stock exchange;
|
•
|
the occurrence of a material adverse change;
|
•
|
revocation, termination, or modification of any authorization, license, consent, permission, or approval as necessary to conduct operations as contemplated by the applicable Rig Financing Agreement ; and
|
•
|
the destruction, abandonment, seizure, appropriation or forfeiture of property of the guarantors or Seadrill and its subsidiaries, or the limitation by seizure, expropriation, nationalization, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority, of the authority or ability of Seadrill or any subsidiary thereof to conduct its business, which has or reasonably may be expected to have a material adverse effect.
|
•
|
guarantees from rig owning subsidiaries (guarantors),
|
•
|
a first priority share pledge over all the shares issued by each of the guarantors,
|
•
|
a first priority perfected mortgage in all collateral rigs and any deed of covenant thereto, subject to contractual agreed "quiet enjoyment" undertakings with the end-user of the collateral rigs to be entered into if this is required by the relevant end-user pursuant to the relevant contract,
|
•
|
a first priority security interest over each of the rig owners' with respect to all earnings and proceeds of insurance, and
|
•
|
a first priority security interest in the earnings accounts.
|
•
|
Key amendments and waivers:
|
◦
|
Equity ratio
: Seadrill is required to maintain a total equity to total assets ratio of at least 30.0%. Prior to the amendment, both total equity and total assets were adjusted for the difference between book and market values of drilling units, as determined by independent broker valuations. The amendment removes the need for the market value adjustment from the calculation of the equity ratio until June 30, 2017.
|
•
|
Leverage ratio
: Seadrill is required to maintain a ratio of net debt to EBITDA. Prior to the amendment the leverage ratio had to be no greater than 6.0:1, falling to 5.5:1 from October 1, 2016, and falling again to 4.5:1 from January 1, 2017. The amendment retains the ratio at 6.0:1 until December 31, 2016, and then increases to 6.5:1 between January 1, 2017 and June 30, 2017.
|
•
|
Minimum-value-clauses
: Seadrill’s secured bank credit facilities contain loan-to-value clauses, or minimum-value-clauses (“MVC”), which could require Seadrill to post additional collateral or prepay a portion of the outstanding borrowings should the value of the drilling units securing borrowings under each of such agreements decrease below required levels. Subject to compliance with the terms of the amendment, this covenant has been suspended until June 30, 2017.
|
•
|
Minimum Liquidity
: Seadrill has previously been required to maintain a minimum of $150 million of liquidity. This has been reset to $250 million until June 30, 2017.
|
•
|
Additional undertakings:
|
◦
|
Further process
: Seadrill has agreed to consultation, information provision and certain processes in respect of further discussions with its lenders under its senior secured credit facilities, including agreements in respect of progress milestones towards the agreement of, and implementation plan in respect of, a comprehensive financing package.
|
◦
|
Restrictive undertakings
: Seadrill has agreed to additional near-term restrictive undertakings applicable during this process, applicable to Seadrill and its subsidiaries, including (without limitation) limitations in respect of:
|
▪
|
incurrence and maintenance of certain indebtedness
|
▪
|
dividends, share capital repurchases and total return swaps;
|
▪
|
investments in, extensions of credit to or the provision of financial support for non-wholly owned subsidiaries;
|
▪
|
investments in, extensions of credit to or the provision of financial support for joint ventures or associated entities;
|
▪
|
acquisitions;
|
▪
|
dispositions;
|
▪
|
prepayment, repayment or repurchase of any debt obligations;
|
▪
|
granting security; and
|
▪
|
payments in respect of newbuild drilling units,
|
•
|
Other changes and provisions:
|
◦
|
Undrawn availability
: Seadrill has agreed it will not borrow any undrawn commitments under its senior secured credit facilities unless the coordinating committee of lenders has been provided 15 days notice of such borrowing.
|
◦
|
Fees
: Seadrill has agreed to pay certain fees to its lenders in consideration of these extensions and amendments.
|
•
|
notify Seadrill of the occurrence of any default or event of default; and
|
•
|
provide Seadrill with information in respect of its business and financial status as Seadrill may reasonably require, including, but not limited to, copies of the Company's unaudited quarterly financial statements and its audited annual financial statements.
|
•
|
failure to pay any sum payable under the revolving credit facility when due;
|
•
|
breach of certain covenants and obligations of the revolving credit facility;
|
•
|
a material inaccuracy of any representation or warranty;
|
•
|
default under other indebtedness in excess of $25.0 million;
|
•
|
bankruptcy or insolvency events; and
|
•
|
commencement of proceedings seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of the Company’s assets that results in an entry of an order for any such relief that is not vacated, discharged, stayed or bonded pending appeal within sixty days of the entry thereof.
|
(In US$ millions)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Taxes payable
|
28.4
|
|
|
12.1
|
|
Employee and business withheld taxes, social security and vacation payment
|
15.4
|
|
|
19.5
|
|
VAT payable
|
4.0
|
|
|
6.1
|
|
Deferred mobilization/demobilization revenues short-term
|
18.0
|
|
|
15.9
|
|
Unrealized loss on derivatives
|
84.2
|
|
|
56.1
|
|
Accrued expenses and other current liabilities
|
67.9
|
|
|
117.7
|
|
Total other current liabilities
|
217.9
|
|
|
227.4
|
|
(In US$ millions)
|
|
2015
|
|
2014
|
|
2013
|
|||
Management and administrative fees (a) and (b)
|
|
75.3
|
|
|
58.6
|
|
|
47.1
|
|
Rig operating costs (c)
|
|
29.3
|
|
|
22.4
|
|
|
16.5
|
|
Insurance premiums (d)
|
|
20.2
|
|
|
21.8
|
|
|
21.8
|
|
Interest expense (e)
|
|
13.7
|
|
|
87.7
|
|
|
87.7
|
|
Commitment fee (f)
|
|
2.0
|
|
|
2.2
|
|
|
4.5
|
|
Derivative (gains) / losses (o)
|
|
10.2
|
|
|
41.6
|
|
|
(49.9
|
)
|
Bareboat charters (h)
|
|
(1.6
|
)
|
|
(25.8
|
)
|
|
(4.9
|
)
|
Other revenues - operating expenses recharged to Seadrill (i)
|
|
(13.4
|
)
|
|
—
|
|
|
(5.8
|
)
|
Operating expenses related to operations recharged to Seadrill (i)
|
|
12.8
|
|
|
—
|
|
|
5.5
|
|
Accretion of discount on deferred consideration (j)
|
|
13.3
|
|
|
—
|
|
|
—
|
|
Total
|
|
161.8
|
|
|
158.1
|
|
|
122.5
|
|
(In US$ millions)
|
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Trading balances due from Seadrill and subsidiaries (k)
|
|
175.9
|
|
|
56.7
|
|
Trading balances due to Seadrill and subsidiaries (k)
|
|
(354.7
|
)
|
|
(250.0
|
)
|
Revolving credit facility with Seadrill (f)
|
|
—
|
|
|
—
|
|
$440 Million Rig Financing Agreement with Seadrill (T-15 and T-16) (g)
|
|
(139.0
|
)
|
|
(158.8
|
)
|
West Vencedor Loan Agreement with Seadrill (West Vencedor) (g)
|
|
(57.5
|
)
|
|
(78.2
|
)
|
Vendor financing loan agreement with Seadrill (l)
|
|
(109.5
|
)
|
|
(109.5
|
)
|
Discount notes with Seadrill (m)
|
|
—
|
|
|
—
|
|
Deferred and contingent consideration to related party - short term portion (j)
|
|
(60.4
|
)
|
|
(25.8
|
)
|
Deferred and contingent consideration to related party - long term portion (j)
|
|
(185.4
|
)
|
|
(111.2
|
)
|
Derivatives with Seadrill - interest rate swaps (n)
|
|
2.2
|
|
|
6.0
|
|
(a)
|
Management and administrative services agreements –
In connection with the IPO, OPCO entered into a management and administrative services agreement with Seadrill Management a wholly owned subsidiary of Seadrill, pursuant to which Seadrill Management provides the Company certain management and administrative services. The services provided by Seadrill Management are charged at cost plus management fee equal to 5% of Seadrill Management’s costs and expenses incurred in connection with providing these services. The agreement has an initial term for 5 years and can be terminated by providing 90 days written notice.
|
(b)
|
Technical and administrative service agreement –
In connection with the IPO, OPCO entered into certain advisory, technical and/or administrative services agreements with subsidiaries of Seadrill. The services provided by Seadrill’s subsidiaries are charged at cost plus service fee equal to approximately 5% of Seadrill’s costs and expenses incurred in connection with providing these services.
|
(c)
|
Rig operating costs
– relates to rig operating costs recharged by Seadrill in relation to costs incurred on behalf of the
West Polaris
and the
West Vencedor
operating in Angola. These costs are recharged by Seadrill at a markup of 5%.
|
(d)
|
Insurance premiums
– the Company’s drilling units are insured by a Seadrill company and the insurance premiums incurred are recharged to the Company.
|
(e)
|
Interest expense –
consists of interest expense incurred on the $440 Million Rig Financing Agreement, West Vencedor Loan Agreement, discount notes and the $109.5 million
T-15
Vendor Financing Loan. Prior to entering these agreements, these costs were allocated to the Company from Seadrill based on the Company’s debt as a percentage of Seadrill’s overall debt. Upon entering these agreements, the costs and expenses have been incurred by the Company.
|
(f)
|
$100 million revolving credit facility
– In October 2012 the Company entered into a $300 million revolving credit facility with Seadrill. The facility is for a term of five years and bears interest at a rate of LIBOR plus 5% per annum, with an annual 2% commitment fee on the undrawn balance. On March 1, 2014, the revolving credit facility was amended to reduce the maximum borrowing limit from $300 million to $100 million. During 2015 the Company drew down nothing from the revolving credit facility and repaid nothing. As at December 31, 2015 and 2014, the outstanding balance was nil and nil, respectively.
|
(g)
|
Rig Financing Agreements
and
Loan Agreements
– See Note 11 - Debt for details of the $440 Million Rig Financing Agreement and West Vencedor Loan Agreement. Under the agreements each rig owning subsidiary makes payments of principal and interest directly to the lenders under each Rig Financing Agreement, at Seadrill’s direction and on its behalf, corresponding to payments of principal and interest due under each Rig Financing Agreement that are allocable to each rig.
|
(h)
|
Bareboat charters
– In connection with the transfer of the
West Aquarius
operations to Canada, the
West Aquarius
drilling contract was assigned to Seadrill Canada Ltd., a wholly owned subsidiary of OPCO, necessitating certain changes to the related party contractual arrangements relating to the
West Aquarius
. Seadrill China Operations Ltd, the owner of the
West Aquarius
and a wholly-owned subsidiary of OPCO, had previously entered into a bareboat charter arrangement with Seadrill Offshore AS, a wholly-owned subsidiary of Seadrill, providing Seadrill Offshore AS with the right to use the
West Aquarius
. In October 2012, this bareboat charter arrangement was replaced with a new bareboat charter between Seadrill China Operations Ltd and Seadrill Offshore AS, and at the same time, Seadrill Offshore AS entered into a bareboat charter arrangement providing Seadrill Canada Ltd. with the right to use the
West Aquarius
in order to perform its obligations under the drilling contract described above. The net effect to OPCO of these bareboat charter arrangements is a cost of $25,500 per day, but due to the downtime of the rig during 2015 the total effect was income of $2.1 million.
|
(i)
|
Other revenues and expenses
- The Company incurs certain operating costs on behalf of Seadrill drilling units and recharges them at a markup of 5%. During the year ended December 31, 2015 the Company earned $13.4 million in other revenues within our Nigerian service company from Seadrill for certain services, including the provision of onshore and offshore personnel, which the Company provided to Seadrill’s
West Jupiter
and
West Saturn
drilling rigs. Operating expenses relating to these related party revenues were $12.8 million in the year ended December 31, 2015.
|
(j)
|
Deferred consideration to related party
- On the acquisition of the
West Polaris
in 2015 the Company recognized a seller's credit balance payable of $44.6 million, a long term deferred consideration balance of $63.7 million
and a short-term deferred consideration balance of $31.6 million.
|
(k)
|
Trading balances –
Receivables and payables with Seadrill and its subsidiaries are comprised primarily of unpaid management fees, advisory and administrative services, as well as, accrued interest. In addition, certain receivables and payables arise when the Company pays an invoice on behalf of a related party and vice versa. Receivables and payables are generally settled quarterly in arrears. Trading balances to Seadrill and its subsidiaries are unsecured, generally bear interest at a rate equal to LIBOR plus approximately 4% per annum, and are intended to be settled in the ordinary course of business.
|
(l)
|
$109.5 million Vendor financing loan
- On May 17, 2013, Seadrill Operating LP borrowed from Seadrill $109.5 million as vendor financing to fund the acquisition of the
T-15
. The loan bears interest at a rate of LIBOR plus a margin of 5% and matures in May 2016.
|
(m)
|
Discount loan notes:
|
•
|
$229.9 million discount note -
On December 13, 2013, as part of the acquisition of the
West Sirius
, Seadrill Capricorn Holdings issued a zero coupon discount note from Seadrill for $229.9 million. The note was repayable in June 2015 and upon maturity, the Company was due to pay $238.5 million to Seadrill. This note was repaid in full in February 2014 with proceeds from the Senior Secured Credit Facilities.
|
•
|
$70.0 million discount note -
On December 13, 2013, as part of the acquisition of the
West Sirius
, the Company issued a zero coupon discount note from Seadrill for $70.0 million. The note was repayable in June 2015 and upon maturity, the Company was due to pay $72.6 million to Seadrill.This note was repaid in full in February 2014 with proceeds from the Senior Secured Credit Facilities.
|
•
|
$100.0 million discount note
-
On March 21, 2014, as part of the acquisition of the
West Auriga
, Seadrill Capricorn Holdings issued a zero coupon discount note to Seadrill in an initial amount of $100.0 million. The note was repayable in September 2015 and upon maturity, the Company was due to pay $103.7 million to Seadrill. This note was repaid in June 2014 with proceeds from the Senior Secured Credit Facilities.
|
(o)
|
Derivatives with Seadrill - Interest rate swaps -
As of December 31, 2015, the Company was party to interest rate swap agreements with Seadrill for a combined outstanding principal amount of approximately $655.3 million at rates between 1.10% per annum and 1.93% per annum. The swap agreements mature between July 2018 and December 2020. The net loss recognized on the Company’s interest rate swaps for the year ended December 31, 2015, was $10.2 million (year ended December 31, 2014: loss of $41.6 million). Refer to Note 14 for further information.
|
Outstanding principal as at December 31, 2015
|
|
Receive rate
|
Pay rate
|
Expiry of contract
|
|
(In US$ millions)
|
|
|
|
|
|
416.3
|
|
(1), (2)
|
3 month LIBOR
|
1.10%
|
July 2, 2018
|
100.0
|
|
(2)
|
3 month LIBOR
|
1.36%
|
October 29, 2019
|
70.4
|
|
(1), (2)
|
3 month LIBOR
|
1.11%
|
June 19, 2020
|
68.6
|
|
(1), (2)
|
3 month LIBOR
|
1.93%
|
December 21, 2020
|
2,851.9
|
|
(1)
|
3 month LIBOR
|
2.45% to 2.52%
|
February 21, 2021
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||
(In US$ millions)
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||
Cash and cash equivalents
|
319.0
|
|
|
319.0
|
|
|
242.7
|
|
|
242.7
|
|
Current portion of long-term debt
|
88.0
|
|
|
105.3
|
|
|
68.3
|
|
|
76.5
|
|
Current portion of long-term debt to related party
|
145.8
|
|
|
145.8
|
|
|
40.4
|
|
|
40.4
|
|
Long-term debt
|
1,763.5
|
|
|
3,487.0
|
|
|
2,574.8
|
|
|
3,227.4
|
|
Long-term portion of debt to related party
|
160.2
|
|
|
160.2
|
|
|
306.1
|
|
|
306.1
|
|
Related party deferred and contingent consideration
|
245.8
|
|
|
245.8
|
|
|
137.0
|
|
|
137.0
|
|
|
|
Fair value measurements
at reporting date using
|
||||||
|
Total fair value as at December 31, 2015
|
Quoted Prices
in Active
Markets for
Identical Assets
|
Significant
Other
Observable
Inputs
|
Significant
Unobservable
Inputs
|
||||
(In US$ millions)
|
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||
Current assets:
|
|
|
|
|
||||
Derivative instruments - Interest rate swap contracts (related party)
|
2.2
|
|
—
|
|
2.2
|
|
—
|
|
Total assets
|
2.2
|
|
—
|
|
2.2
|
|
—
|
|
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Derivative instruments - Interest rate swap contracts
|
(84.2
|
)
|
—
|
|
(84.2
|
)
|
—
|
|
Total liabilities
|
(84.2
|
)
|
—
|
|
(84.2
|
)
|
—
|
|
|
|
Fair value measurements
at reporting date using
|
||||||
|
Total fair value as at December 31, 2014
|
Quoted Prices
in Active
Markets for
Identical Assets
|
Significant
Other
Observable
Inputs
|
Significant
Unobservable
Inputs
|
||||
(In US$ millions)
|
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||
Current assets:
|
|
|
|
|
||||
Derivative instruments - Interest rate swap contracts (related party)
|
6.0
|
|
—
|
|
6.0
|
|
—
|
|
Total assets
|
6.0
|
|
—
|
|
6.0
|
|
—
|
|
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Derivative instruments - Interest rate swap contracts (related party)
|
(56.1
|
)
|
—
|
|
(56.1
|
)
|
—
|
|
Total liabilities
|
(56.1
|
)
|
—
|
|
(56.1
|
)
|
—
|
|
|
2015
|
|
2014
|
|
2013
|
|||
BP
|
44.8
|
%
|
|
41.5
|
%
|
|
35.0
|
%
|
ExxonMobil *
|
32.1
|
%
|
|
26.4
|
%
|
|
14.5
|
%
|
Tullow
|
13.5
|
%
|
|
17.4
|
%
|
|
18.8
|
%
|
Chevron
|
8.5
|
%
|
|
14.7
|
%
|
|
12.1
|
%
|
Total
|
—
|
%
|
|
—
|
%
|
|
19.6
|
%
|
Other
|
1.1
|
%
|
|
—
|
%
|
|
—
|
%
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Year ended December 31,
|
||||||||||
(in US $ millions, except per unit data)
|
2015
|
|
2014
|
|
2013
|
||||||
Net income attributable to:
|
|
|
|
|
|
||||||
Common unitholders
|
$
|
184.1
|
|
|
$
|
109.2
|
|
|
$
|
56.4
|
|
Subordinated unitholders
|
40.5
|
|
|
29.0
|
|
|
30.2
|
|
|||
Seadrill member interest
(1)
|
32.6
|
|
|
—
|
|
|
57.8
|
|
|||
Net income attributable to Seadrill Partners LLC owners
|
$
|
257.2
|
|
|
$
|
138.2
|
|
|
$
|
144.4
|
|
|
|
|
|
|
|
||||||
Weighted average units outstanding (basic and diluted) (in thousands):
|
|
|
|
|
|
||||||
Common unitholders
|
75,278
|
|
|
62,374
|
|
|
26,266
|
|
|||
Subordinated unitholders
|
16,543
|
|
|
16,543
|
|
|
16,543
|
|
|||
|
|
|
|
|
|
||||||
Earnings per unit (basic and diluted):
|
|
|
|
|
|
||||||
Common unitholders
|
$
|
2.45
|
|
|
$
|
1.75
|
|
|
$
|
2.15
|
|
Subordinated unitholders
|
$
|
2.45
|
|
|
$
|
1.75
|
|
|
$
|
1.83
|
|
|
|
|
|
|
|
||||||
Cash distributions declared and paid in the period per unit
(2)
|
$
|
1.7025
|
|
|
$
|
1.6025
|
|
|
$
|
1.2325
|
|
|
|
|
|
|
|
||||||
Subsequent event: Cash distributions declared and paid relating to the period per unit
(3)
:
|
$
|
0.2500
|
|
|
$
|
0.5675
|
|
|
$
|
0.4450
|
|
(1)
|
Pre-acquisition net income from entities acquired from Seadrill in common control transactions during 2013 (See Note 3), has been allocated to the Seadrill member interest. The Seadrill member interest, and its rights to the incentive distribution rights, is owned by the predecessor owner of acquired entities, Seadrill Limited. Included within the amount allocated to the Seadrill member interest in 2013 is $0.5 million allocated to the incentive distribution rights.
|
(2)
|
Refers to the cash distributions relating to the period declared and paid during the year.
|
(3)
|
Refers to the cash distribution relating to the period, declared and paid subsequent to the year-end.
|
•
|
First, to the common unitholders, pro-rata, until the Company distributes for each outstanding common unit an amount equal to the minimum quarterly distribution for that quarter;
|
•
|
Second, to the common unitholders, pro-rata, until the Company distributes for each outstanding common an amount equal to any arrearages in payment of the minimum quarterly distribution on the common units for prior quarters during the subordination period; and
|
•
|
Third, to the subordinated units, pro-rata, the Company distributes for each subordinated unit an amount equal to the minimum quarterly distribution for that quarter;
|
•
|
The Company has distributed available cash from operating surplus to the common and subordinated unitholders in an amount equal to the minimum quarterly distribution; and
|
•
|
The Company has distributed available cash from operating surplus on outstanding common units in an amount necessary to eliminate any cumulative arrearages in payment of the minimum quarterly distribution;
|
•
|
first, 100.0% to all unitholders, until each unitholder receives a total of $0.4456 per unit for that quarter (the “first target distribution”);
|
•
|
second, 85% to all unitholders, pro rata, and 15.0% to the holders of the incentive distribution rights, pro rata, until each unitholder receives a total of $0.4844 per unit for that quarter (the “second target distribution”);
|
•
|
third, 75.0% to all unitholders, pro rata, and 25.0% to the holders of the incentive distribution rights, pro rata, until each unitholder receives a total of $0.5813 per unit for that quarter (the “third target distribution”); and
|
•
|
thereafter, 50.0% to all unitholders, and 50.0% to the holders of the incentive distribution rights, pro rata.
|
•
|
distributions of available cash from operating surplus on each of the outstanding common units and subordinated units equaled or exceeded the minimum quarterly distribution for each of the three consecutive, non-overlapping four-quarter periods immediately preceding that date;
|
•
|
the “adjusted operating surplus” (as defined in the partnership agreement) generated during each of the three consecutive, non-overlapping four-quarter periods immediately preceding that date equaled or exceeded the sum of the minimum quarterly distributions on all of the outstanding common units and subordinated units during those periods on a fully diluted weighted average basis during those periods; and
|
•
|
there are no outstanding arrearages in payment of the minimum quarterly distribution on the common units.
|
|
Year ended December 31,
|
|||||||
(in US $ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Distributions paid to incentive distribution rights holders
|
9.5
|
|
|
9.2
|
|
|
—
|
|
(In US$ millions)
|
2015
|
|
2014
|
|
2013
|
|||
Purchase of
West Auriga
, issuance of loan note to related party (1)
|
—
|
|
|
100.0
|
|
|
—
|
|
Purchase of
West Vela
, deferred consideration payable to related party (2)
|
—
|
|
|
73.7
|
|
|
—
|
|
Purchase of
West Vela
, contingent consideration payable to related party (2)
|
—
|
|
|
65.7
|
|
|
—
|
|
Purchase of the
West Polaris
, deferred consideration payable to related party (3)(4)
|
65.0
|
|
|
—
|
|
|
—
|
|
Purchase of the
West Polaris
, seller's credit payable to related party (3)
|
44.6
|
|
|
—
|
|
|
—
|
|
Capital injection due to forgiveness of related party payables
|
—
|
|
|
—
|
|
|
40.5
|
|
1.
|
The purchase of the
West Auriga
was financed by the issuance of a discount loan note: refer to Note 3
- Business acquisitions
|
2.
|
The purchase of the
West Vela
was financed partly by deferred and contingent consideration: refer to Note 3
- Business acquisitions
|
3.
|
The purchase of the
West Polaris
was financed party by a seller's credit and deferred consideration: refer to Note 3
- Business acquisitions.
|
4.
|
The contingent consideration payable to Seadrill was reduced by a measurement period adjustment in the year ended December 31, 2015. Refer to Note 3
- Business acquisitions.
|
|
|
SEADRILL PARTNERS LLC
(Registrant)
|
|
|
|
|
|
Date: April 28, 2016
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Mark Morris
|
|
|
Name:
|
Mark Morris
|
|
|
Title:
|
Chief Executive Officer of Seadrill Partners LLC
(Principal Executive Officer of Seadrill Partners LLC)
|
From:
|
Rosneft Oil Company
|
To :
|
Seadrill Limited
|
1.
|
We refer to the framework agreement dated 20 August 2014 (as amended from time to time, the "
Framework
Agreement
") between Rosneft Oil Company ("
Rosneft
"), Seadrill Limited ("
Seadrill
") and North Atlantic Drilling Ltd. ("
NADL
" and together with Rosneft and Seadrill, the "
Parties
" and each a "
Party
") in relation to,
inter alia
, the issuance by NADL of a certain number of NADL shares to Rosneft in consideration of the transfer by Rosneft to NADL of the 100% participatory interest in limited liability company "RN Burenie" and the issuance by NADL of certain additional NADL shares to Rosneft in consideration of a cash payment.
|
2.
|
In this letter, unless the context requires otherwise, terms defined in the Framework Agreement and not otherwise defined herein, shall have the same meanings in this letter. The principles of interpretation in Clause 1 (Interpretation) of the Framework Agreement shall also apply to this letter. References in the Framework Agreement to the “Agreement” and the “Key Agreements” include this letter and the Framework Agreement as amended by the terms of this letter and the letters dated 7 November 2014 and 13 April 2015.
|
3.
|
In accordance with Clause 25.6 of the Framework Agreement, the Parties have agreed to vary the Framework Agreement on the terms of paragraphs 4 and 9 of this letter with effect from 1 May 2015 (the "
Effective Date
"). The provisions of Clauses 23 to 36 of the Framework Agreement shall apply to this letter as though incorporated herein
mutatis mutandis
.
|
4.
|
The Parties agree that the Framework Agreement shall be amended with effect from the Effective Date as follows:
|
(A)
|
Clause 8 shall be deleted and replaced with the following:
|
(B)
|
Clause 9 shall be deleted and replaced with the following:
|
9.
|
The Parties acknowledge and agree that, although Clause 6.2 of the Framework Agreement requires Rosneft to use its reasonable endeavours to fulfil certain of the Conditions as soon as possible after the date of the Framework Agreement and Clause 6.3 of the Framework Agreement requires NADL and Seadrill to use their respective reasonable endeavours to fulfil certain of the Conditions as soon as possible after the date of the Framework Agreement, with effect from the Effective Date the Parties do not intend to take any steps to satisfy the Conditions unless and until the terms of the Transaction have been renegotiated, as contemplated in paragraph 7 of the letter dated 13 April 2015.
|
10.
|
Other than as provided in paragraphs 4 and 9 above, the Framework Agreement shall continue in full force and effect. Nothing in this letter shall be construed as any waiver by any of the Parties of any of the Conditions in the Framework Agreement.
|
11.
|
Please confirm your agreement to the terms of this letter by countersigning below and returning one copy to us. This letter may be executed in any number of counterparts and by the Parties on separate counterparts, but shall not be effective unless each Party has executed at least one counterpart. Each counterpart shall constitute an original of this letter, but all the counterparts shall together constitute but one and the same instrument.
|
/s/ Alf Ragnar Løvdal
|
June 30, 2015
|
……………………………………………….
North Atlantic Drilling Ltd.
|
……………………………………………….
Date
|
|
|
/s/ Jon Olav Østhus
|
July 3, 2015
|
……………………………………………….
Seadrill Limited
|
……………………………………………….
Date
|
(1)
|
JURONG SHIPYARD PTE LTD
, a corporation organized under the laws of Singapore, having its registered office at 29 Tanjong Kling Road, Singapore 628054 (the “
Builder
”);
|
(2)
|
NORTH ATLANTIC RIGEL LTD
, a company organized under the laws of Bermuda and having its office at Par-la-Ville Place, 4
th
Floor, 14 Par-la-Ville Road, Hamilton HMGX, Bermuda (the “
Purchaser
”)
|
A.
|
The Builder and the Purchaser have entered into a contract dated 2 April 2012 (the “Contract”) for the design, procurement, construction, equipment, commissioning and delivery to the Purchaser of one (1) Moss Maritime CS60 semi-submersible drilling rig bearing hull number 11-1112 to be known as “WEST RIGEL” (the “Unit”).
|
B.
|
There is a dispute between the Parties as to responsibility for the delay in Delivery and entitlement to Permissible Delays.
|
C.
|
The Parties wish to agree terms on which the Parties agree to fully and finally settle the disputes between them as summarized herein, and during a defined period (the “Deferral Period” as defined in this Amendment), Delivery of the Unit to the Purchaser shall be postponed, and the Purchaser shall attempt to find satisfactory employment for the Unit *****.
|
D.
|
If the Deferral Period should expire without any employment contract or sale of the Unit, the Unit shall be transferred into the ownership of a joint asset holding company and the joint asset holding agreement at Appendix 1 shall then be immediately effective.
|
1.
|
Definitions
|
1.1.
|
All capitalized terms used in this Amendment which are expressly defined in the Contract shall have the meaning set out therein, unless defined in this Amendment which definition shall prevail.
|
1.2.
|
The following capitalized terms used in this Amendment shall have the following meanings:-
|
“Builder’s Stacking Costs”
|
|
has the meaning set out in Clause 5.4.
|
“Deferral Period”
|
|
means the period commencing on the Effective Date of this Amendment, and ending on the earliest of (i) the sale of the Unit to a third party pursuant to Clause 5 below; (ii) Delivery of the Unit to the Purchaser pursuant to Clause 6 below; or (iii) midnight London time on the date falling 6 months from the Effective Date of this Amendment unless prior to such date the Parties have agreed in writing to an extension to the Deferral Period.
|
“Delivery Notice”
|
|
has the meaning set out in Clause 6.2.
|
“Effective Date of this Amendment”
|
|
has the meaning set out in Clause 9.2.
|
|
|
|
“Purchaser’s Crewing Costs”
|
|
has the meaning set out in Clause 5.6.
|
“Qualifying Drilling Contract”
|
|
means a drilling contract for the Unit with a third party employer acceptable to the Purchaser in its absolute discretion and with an Operating Rate and contract duration acceptable to the Purchaser in its absolute discretion.
|
“Third Party Purchaser”
|
|
has the meaning set out in Clause 5.1.
|
“Third Party Sale”
|
|
has the meaning set out in Clause 5.1.
|
“Third Party Sale Notice”
|
|
has the meaning set out in Clause 5.2.
|
“Final Installment Interest Amount”
|
|
has the meaning set out in Clause 5.5.
|
“Joint Asset Holding Agreement”
|
|
means the joint asset holding agreement as set out in Appendix 1 hereof scheduled to be entered into by the Builder and North Atlantic Drilling Ltd as set out in Clause 7.1 hereof.
|
“Joint Asset Holding Company”
|
|
means the Company as defined in the Joint Asset Holding
Agreement
|
A.
|
THE DEFERRAL PERIOD
|
2.
|
Completion of the Unit
|
2.1.
|
During the Deferral Period:-
|
2.1.1.
|
the Builder shall complete all the items set out in Sections A and B of Appendix 4 hereto;
|
2.1.2.
|
subject to the completion by the Builder of the items set out in Section A of Appendix 4 hereto, Technical Acceptance of the Unit by the Purchaser shall take place; and
|
2.1.3.
|
after Technical Acceptance of the Unit, the Builder shall, at its exclusive cost and risk and to the standards of a prudent major international shipyard:
|
(i)
|
maintain the Unit at the quayside of the Builder’s yard in Singapore and in a condition to be mutually agreed;
|
(ii)
|
maintain and preserve in operational order all machinery, equipment and spare parts relating to the Unit; and
|
(iii)
|
provide security for the Unit to ensure that no personnel other than (i) the personnel of the Builder or of its subcontractors who are working on the Unit, (ii) personnel working for the Purchaser, (iii) personnel from any third party interested in buying the Unit (who shall provide confidentiality undertakings in a form reasonably satisfactory to the Purchaser) or (iv) other personnel authorized by the Purchaser and the Builder, can board the Unit or inspect the Unit or any machinery and equipment relating to the Unit.
|
2.1.4
|
After Technical Acceptance of the Unit, the Purchaser shall, at its exclusive cost, supply a crew for the maintenance of the drilling and subsea equipment of the Unit, who shall be deemed to be Purchaser’s Personnel for the purposes of Clause 24 of the Contract.
|
3.
|
Title and Risk of Loss
|
3.1.
|
As further provided in the Contract, the Builder shall at all times prior to Delivery retain legal title to, and all risks of loss of, or damage to, the Unit, including for the avoidance of doubt the drilling and subsea equipment of the Unit, and be responsible for insuring her by extending its existing Builder’s All Risk Insurance and other insurances in respect thereof.
|
(i)
|
if:
|
a.
|
an order or an effective resolution is passed for the winding up of either Party (otherwise than for the purposes of a reconstruction or amalgamation previously approved by the Builder or the Purchaser, as the case may be, such approval not to be unreasonably withheld or delayed) or if a receiver is appointed over the whole or any substantial part of the undertaking or property of either Party or if such Party becomes insolvent or suspends payment generally of its debts or ceases to carry on its business or makes any special arrangement or composition with its creditors; or
|
b.
|
a Party is in breach of any of its obligations under Clause 7 of this Amendment;
|
(ii)
|
Clause 11.2 of the Contract shall continue to apply in the event of a total loss of the Unit.
|
4.
|
Marketing and Employment of the Unit
|
4.1.
|
During the Deferral Period, the Purchaser shall undertake worldwide marketing of the Unit for the purposes of seeking to obtain satisfactory drilling contract employment for the Unit within its specified capabilities.
|
4.2.
|
The Purchaser shall provide to the Builder on a monthly basis a report setting out the status of any such drilling contract opportunities.
|
4.3.
|
As further provided in Clause 6 hereof, if the Purchaser enters into a binding Qualifying Drilling Contract for the Unit, subject to Technical Acceptance having occurred, the Purchaser shall accept Delivery of the Unit from the Builder in accordance with Clause 6 below.
|
5.
|
Sale of the Unit
|
5.1.
|
*****
|
5.2.
|
*****
|
5.3.
|
The contract price under a Third Party Sale shall be paid as follows:
|
5.3.1.
|
that part of the contract price equal to the Builder’s Stacking Costs plus the Final Installment Interest Amount shall be paid by the Third Party Purchaser to the Builder;
|
5.3.2.
|
that part of the contract price equal to the sum of (i) the Purchaser’s Crewing Costs at the Builder’s shipyard, (ii) all costs and expenses of the Purchaser relating to the purchase and supply of Purchaser’s Supplies for the Unit which have not been returned to the Purchaser, (iii) all costs and expenses of the Purchaser relating to the preparation for operation of the Unit at the Builder’s shipyard, and (iv) interest on the First Instalment calculated at three percent (3%) above LIBOR from the date of payment of the First Instalment by the Purchaser to the date of payment of the sum referred to in paragraph
|
5.3.3.
|
the balance of the contract price after deduction of the sums referred to in Clauses 5.3.1 and 5.3.2 above shall be paid as follows:
|
5.3.3.1.
|
23% thereof shall be paid by the Third Party Purchaser to the Purchaser direct to an account nominated by the Purchaser. Such sum shall be paid as a condition of delivery of the Unit to the Third Party Purchaser;
|
5.4.
|
The “Builder’s Stacking Costs” shall be the Builder’s reasonable and documented costs and expenses of stacking the Unit for the period commencing upon Technical Acceptance of the Unit and ending on the date of expiry of the Deferral Period.
|
5.5.
|
The “Final Installment Interest Amount” shall be calculated at three per cent (3%) above LIBOR on the amount of the Final Instalment, but excluding any adjustment for the Builder’s Stacking Costs. The interest period shall commence after Technical Acceptance of the Unit and end on the date of payment to the Builder of the contract price under the Third Party Sale. Such interest shall be calculated on the basis of a three hundred and sixty (360) day year and compounded monthly.
|
5.6.
|
The “Purchaser’s Crewing Costs” shall be the Purchaser’s reasonable and documented costs and expenses of maintaining the drilling and subsea equipment of the Unit for the period commencing upon Technical Acceptance of the Unit and ending on the date such crew leaves the Unit.
|
5.7.
|
*****
|
5.8.
|
Upon receipt by the Purchaser of the sums referred to in Clauses 5.3.2 and 5.3.3.1 above plus interest pursuant to Clause 5.7 above, if applicable, the Contract as amended by this Amendment shall automatically terminate and the Purchaser shall be under no further obligation as to payment under the Contract save as set out herein or arising herefrom.
|
6.
|
Delivery
|
6.1.
|
During the Deferral Period, the Purchaser shall have the option to accept Delivery of the Unit at any time, but shall not be obliged to accept Delivery of the Unit unless the Purchaser has secured a binding Qualifying Drilling Contract and Technical Acceptance of the Unit has occurred.
|
6.2.
|
If the Purchaser wishes to exercise its option to take Delivery of the Unit, or enters into a binding Qualifying Drilling Contract and Technical Acceptance of the Unit has occurred, the Purchaser shall give the Builder written notice of its wish to accept Delivery of the Unit (the “Delivery Notice”). *****
|
6.3.
|
*****
|
6.4.
|
Delivery of the Unit shall be effected in accordance with the Contract no later than 10
Banking Days after receipt by the Builder of the Purchaser’s Delivery Notice
.
Upon
Delivery, the Unit shall comply in all respects with the provisions of the Contract and the Specification. For the avoidance of doubt, the Guarantee Period shall commence on Technical Acceptance in accordance with the provisions of Clause 16 of the Contract.
|
6.5
|
For the avoidance of doubt, the Final Instalment of the Contract Price, payable by the Purchaser upon acceptance of Delivery, shall not be increased by the Builder’s Stacking Costs.
|
B.
|
EXPIRY OF THE DEFERRAL PERIOD
|
7.
|
Expiry of the Deferral Period
|
7.1.
|
If the Deferral Period expires due to expiry of the 6 month period from the Effective Date of this Amendment, then upon such expiry:
|
7.1.4.
|
the Builder shall as soon as practicable transfer title to the Unit to the Joint Asset Holding Company, and having achieved Technical Acceptance for the Unit prior to the end of the Deferral Period;
|
7.1.5.
|
the Joint Asset Holding Agreement shall become automatically effective;
|
7.1.6.
|
as soon as practicable after transfer of title to the Unit to the Joint Asset Holding Company, the Purchaser shall execute a deed of assignment to assign the Contract as amended by this Amendment to the Joint Asset Holding Company and the Builder hereby confirms its consent to such assignment pursuant to Clause 22 of the Contract without imposing any conditions or terms; and
|
7.1.7.
|
the Guarantee Period under Clause 16 of the Contract shall commence upon Technical Acceptance and the Builder shall be bound by all obligations and liabilities under Clause 16 of the Contract. The Parties shall jointly discuss with the Builder’s vendors and subcontractors extending the warranties of the Builder’s vendors’ and subcontractors’ equipment for a period in excess of 12 months from Technical Acceptance. Any extension of such warranties shall be subject to the agreement of the Parties. The costs of extension of warranties of the Builder’s vendors and subcontractors for any period in excess of 12 months from Technical Acceptance shall be added to the Builder’s Stacking Costs.
|
7.2
|
*****
|
C.
|
GENERAL PROVISIONS
|
8.
|
Waiver of Claims for Liquidated Damages for Delay
|
8.1.
|
In consideration of the foregoing, the Purchaser agrees to waive its entitlement to liquidated damages for delay in Delivery pursuant to Clauses 15.1 and 15.2 of the Contract.
|
9.
|
Effective Date
|
9.1.
|
This Amendment shall become effective upon satisfaction of the following conditions precedent:-
|
9.1.2.
|
a written confirmation of Sembcorp Marine Ltd in the form set out in Appendix 2 to this Amendment (or such other form as the Purchaser may, in its absolute discretion, agree) and;
|
9.1.3.
|
a written confirmation of Seadrill Limited in the form set out in Appendix 3 to this Amendment (or such other form as the Builder may, in its absolute discretion, agree).
|
9.2.
|
The date on which such conditions precedent are satisfied is known herein as the “Effective Date of this Amendment”.
|
9.3.
|
Unless the Parties agree otherwise, if the Effective Date shall not have occurred on or before 2
nd
December 2015 this Amendment shall be null and void and of no legal effect. The Parties’ respective rights and obligations shall in such circumstances remain in all respects un-waived and unaffected by the provisions of this Amendment.
|
10.
|
Miscellaneous Provisions
|
10.1.
|
Except as provided herein, all provisions, terms and conditions of the Contract shall remain in full force and effect. In the event of any conflict between the Contract and this Amendment, this Amendment shall prevail.
|
10.2.
|
Each Party warrants and represents to the other with respect to itself that it has the full right, power and authority to execute, deliver and perform this Amendment.
|
10.3.
|
Each Party acknowledges that it has not entered into this Amendment in reliance wholly or partly on any representation or warranty made by or on behalf of the other Party (whether orally or in writing) other than as expressly set out in this Amendment.
|
10.4.
|
The law and arbitration provisions of the Contract shall equally apply to any claim, dispute or difference between the Parties arising out of or in connection with this Amendment.
|
Signed by
/s/ Jon Olav Osthus
Title
Director
for and on behalf of NORTH ATLANTIC RIGEL LTD
|
Jon Olav Osthus
............................................................
|
|
|
Signed by
/s/ William Gu
Title
General Manager (Offshore)
for and on behalf of JURONG SHIPYARD PTE LTD
|
William Gu
............................................................
|
(1)
|
Jurong Shipyard Pte. Ltd.
, a company incorporated in Singapore with its registered office at 29 Tanjong Kling Road, Singapore 628054 or its nominee (
Jurong
); and
|
(2)
|
North Atlantic Drilling Ltd.
, a company incorporated in Bermuda with its registered office at Par-la Ville Place, 14 Par-la Ville Road, Hamilton, Bermuda or its nominee (
NADL
),
|
(A)
|
The Parties have agreed to jointly incorporate and own the Company on the basis of a 23/77 percentage shareholding split whereby the Company will be the owning company for the Rig.
|
(B)
|
The Parties are desirous of pooling their respective expertise and certain of their resources together for the purpose of operating and trading the Rig. The purpose of this Agreement is therefore to set out the terms and conditions on and subject to which the activities and operations of Company shall be operated as a joint venture and the manner in which the affairs of the Company are to be regulated.
|
1
|
Definitions
|
1.1
|
In this Agreement, including the schedules and the recitals:
|
1.1
|
Clause headings are inserted for convenience of reference only and should be ignored in the interpretation of this Agreement.
|
1.2
|
References in this Agreement to Clauses and Schedules are to clauses of and schedules to this Agreement.
|
1.3
|
References to
this Agreement
are references to this Agreement (including the Schedule(s) to it) as the same may further be amended, supplemented or varied at any time.
|
1.4
|
Words importing the singular include the plural and vice versa, words importing gender or the neuter include both genders and the neuter and references to persons include bodies corporate or unincorporated.
|
1.2
|
References in this Agreement to statutory provisions shall be construed as references to those provisions as respectively amended or re-enacted (whether before or after the date hereof) from time to time and shall include any provision of which they are re-enactments (whether with or without modification) and any subordinate legislation made under such provisions.
|
1.3
|
Writing or written
includes faxes and email (save for any notice to be given under or in connection with this Agreement in accordance with Clause 27 and any variation of this Agreement made in accordance with Clause 29), and any reference to a document is a reference to the document whether in paper or (save as aforesaid) electronic form.
|
2
|
Formation of the Company
|
2.1
|
It is acknowledged that
,
prior to Completion, the Parties shall procure the formation of the Company
i
n accordance w
i
th the laws of Bermuda in a manner and structured to be as tax-efficient as possible and subject to this Agreement.
|
2.2
|
Subject to the terms of this Agreement, the Company shall bear all the costs related to its formation and registration.
|
2.3
|
The Company's Constitutional Documents shall be in a standard form for companies incorporated in Bermuda provided always that such Constitutional Documents enable the Company to carry out business in the manner contemplated by this Agreement (including, without limitation, the business objectives set out in Clause 2.6 below)
.
|
2.4
|
The issued capital of the Company shall consist of a number of shares to be determined (the
Shares
),
which on the date of Completion shall be owned as follows:
|
(a)
|
77% of the Shares shall be issued and delivered to Jurong under Share Certificate No. 1; and
|
(b)
|
23% of the Shares shall be issued and delivered to NADL under Share Certificate No. 2;
|
2.5
|
The A Shares and the B Shares shall rank pari passu in all respects.
|
2.6
|
The objectives and business of the Company shall be as follows:
|
(a)
|
the ownership of the Rig;
|
(b)
|
exploration of opportunities for the sale of the Rig to a third party; and
|
(c)
|
co-operation with NADL for the provision of offshore drilling services by the Rig through the Approved Manager.
|
3
|
Completion
|
3.1
|
The Parties agree that the following matters shall take place on or prior to the date of Completion:
|
(a)
|
the Shares shall be issued to the Parties in accordance with Clause 2.4;
|
(b)
|
the Parties shall convene a meeting of the Board to be held as necessary to:
|
(i)
|
appoint three (3) persons nominated by Jurong as A Directors and one (1) person nominated by NADL as a B Director thereof (to the extent such appointments were not made upon the incorporation of the Company); and
|
(ii)
|
appoint the officers of the Company.
|
3.2
|
The Parties agree that, as soon as practicable following Completion, all arrangements necessary for the Company to take title to the Rig in accordance with Amendment No. 1 and for the capital contributions in accordance with Clause 5.3 shall be implemented.
|
3.3
|
Each Party agrees with the other Party that it shall take such steps as lie within its power to procure and ensure that the Company performs its obligations under the Transaction Documents.
|
4
|
Financing for the Rig
|
4.1
|
If, at any time, the Parties agree to procure, on behalf of the Company, Approved Finance for the Rig with a reputable international bank or banks on the best possible terms available at the time and for a transaction of this type in the most optimum manner with the maximum debt-equity ratio, the Parties shall inter alia have regard to:
|
(a)
|
the interest rate being offered;
|
(b)
|
the fees and other costs which would apply;
|
(c)
|
the repayment terms;
|
(d)
|
the amount of such bank finance and the equity requirements from the Parties in respect of the financing of the Rig;
|
(e)
|
the security on standard terms, namely, a first priority mortgage over the Rig and collateral deed of covenants (if applicable) and an assignment of the Rig’s earnings and insurances;
|
(f)
|
the need for the terms of the Approved Finance to accommodate the objectives set out in this Agreement; and
|
(g)
|
the applicable market conditions for financing of vessels similar to the Rig at the time.
|
4.2
|
Neither Party is obliged to provide any guarantee to secure the obligations of the Company in relation to Approved Finance.
|
5
|
Funding Arrangements
|
5.1
|
The Board shall from time to time meet and agree the general financing requirements of the Company and shall agree to put into effect appropriate arrangements.
|
5.2
|
If the Board of the Company unanimously resolves that the Parties should provide additional funds to the Company, each Party shall pay with the same value date to the Company its Capital Percentage of the agreed Shareholder Contribution within thirty (30) days. .
|
5.3
|
The Parties agree that, on or following Completion:
|
5.3.2
|
Jurong shall transfer title to the Rig to the Company for a contract price payable as follows:
|
(a)
|
USD 460,246,638.41 due to Jurong; and
|
(b)
|
USD 137,529,623.00 due to NADL;
|
5.3.3
|
NADL shall transfer title to the Purchaser’s Supply (to the extent not returned to the Purchaser) to the Company for payment to the Purchaser of an amount equal to the Purchaser’s Supply Costs;
|
5.3.4
|
the Company shall reimburse Jurong for the Builder’s Stacking Costs from the date of the Technical Acceptance to the date of Completion; and
|
5.3.5
|
the Company shall pay NADL for the Crew Costs from the date of the Technical Acceptance to the date of Completion,
|
5.4
|
On Completion, the Purchaser and the Company shall enter into a deed of assignment in respect of the Construction Contract.
|
5.5
|
Each Shareholder Contribution will be treated as a shareholder loan and shall be on such terms (including, without limitation, as to interest and repayment) as the Parties may agree in writing and not as subscription monies for further Shares. The decision to make a Shareholder Contribution (other than any which the Parties are required to make under Clauses 5.3 and 6.1(e)) its terms and any amendment of those terms shall constitute a Reserved Matter.
|
5.6
|
Any further Shareholder Contribution made by a Party to the Company shall be evidenced in writing in a Shareholder Loan that shall be executed by the Party making the Shareholder Contribution and the Company in a form to be mutually agreed.
|
5.7
|
The Parties will procure that upon receipt of a Shareholder Contribution the Company will credit its shareholders' loan account with an amount equal to the amount of such Shareholder Contribution so paid.
|
6
|
Rig Arrangements
|
6.1
|
In respect of arrangements for the operation and trading of the Rig, the Parties agree as follows:
|
(a)
|
the Approved Manager shall be appointed as manager of the Rig in accordance with the terms of a management agreement in a form agreed by the Parties based on established market practice involving any major international drilling contractor (the Approved Management Agreement);
|
(b)
|
the Parties, through the Approved Manager, shall explore employment opportunities for the Rig with third party clients on commercially reasonable terms;
|
(c)
|
unless otherwise agreed by the Parties, the Rig shall be bareboat chartered by the Company to the Approved Manager or an affiliated company of the Approved Manager on the basis of the standard BIMCO Barecon terms for the duration of any employment contract with a third party (in which the Approved Manager or its affiliated company shall be the principal) at a fixed rate of hire, or as otherwise mutually agreed. The Approved Manager shall ensure that payment of the hire is paid to the Company on time;
|
(d)
|
at any time when the Rig is not employed under a Bareboat Charter, it shall be stacked at a shipyard and operated by Jurong;
|
(e)
|
all costs of keeping the Rig in an operable condition and stacking costs shall unless otherwise mutually agreed between the Parties, be funded by the Parties as Shareholder Loans.
|
6.2
|
The net proceeds from any Bareboat Charter shall (subject to maintaining a prudent reserve, if necessary) be applied in the order described in Clause 7.2.
|
6.3
|
*****
|
6.3.1
|
*****
|
6.3.2
|
*****
|
6.3.3
|
*****
|
6.4
|
*****
|
7
|
Sale of the Rig
|
7.1
|
*****
|
7.1.6
|
*****
|
7.1.7
|
*****
|
7.2
|
Any proceeds of sale of the Rig (after deducting the costs of sale) shall be applied as follows subject to the terms of any Approved Finance:
|
7.2.4
|
First, all Shareholder Contributions in respect of Stacking Costs, Crew Costs and Purchaser’s Supply Costs shall be repaid on a pro rata basis;
|
7.2.5
|
Second, the interests payable on the Shareholders Loans;
|
7.2.6
|
Third, the proceeds shall be divided between Jurong and NADL in the Capital Percentages. Each Party’s entitlement shall be applied to repaying its remaining Shareholder Contributions, and any balance due to a Party after such repayment shall be distributed to it as dividend, to the fullest extent possible.
|
7.3
|
After completion of the sale and distribution of proceeds under Clause 7.2, the Parties shall procure the winding up of the Company. Any costs of the winding up shall be borne by the Parties according to the Capital Percentages.
|
7.4
|
Notwithstanding any other provision of this Agreement, it is agreed that neither the Rig nor a Party’s Shares may be sold to a third party where such sale or that third party’s intended use or employment of the Rig would be in breach of any sanctions or laws applicable to or binding on either Party or the corporate group to which a Party belongs.
|
8
|
Purchase Obligation
|
8.1
|
If and when a Bankable Drilling Contract is awarded for the Rig, NADL shall have the obligation to purchase the Shares owned by Jurong at a value equal to the Shareholder Contributions then outstanding from the Company to Jurong with interest at 3% above LIBOR, or such other price as Parties may agree.
|
8.2
|
For the purposes of this Clause,
Bankable Drilling Contract
shall mean a drilling contract for the Rig with a third party employer acceptable to NADL in its absolute discretion and with an operating rate and contract duration acceptable to NADL in its absolute discretion.
|
9
|
Accounting Arrangements
|
9.1
|
Accounting:
|
(a)
|
management accounts on a quarterly and annual basis; and
|
(b)
|
audited accounts on an annual basis, each in accordance with US GAAP.
|
9.2
|
The Parties may inspect the books and records of the Company and the Approved Manager at any time during regular working hours and upon reasonable prior notice.
|
10
|
Board and Shareholders' Meetings
|
10.1
|
The Board shall have responsibility for the supervision and management of the Company.
|
10.2
|
The Board shall consist of no less than four (4) directors and shall be made up of three (3) A Directors and one (1) B Director. In any case where there is a requirement for the Board to appoint a Chairman (or similar officer), the post of Chairman (or similar officer) shall be held by an A Director, but such appointment shall not carry any additional voting rights whatsoever.
|
10.3
|
A Party may remove a director appointed by it and appoint a new director in his or her place by notice in writing to the Company and the other Party. Each Party (in its capacity as a shareholder) unconditionally and irrevocably appoints the other Party its proxy to vote its shares in the Company for the appointment or removal of any director or officer of the Company appointed by the other Party. The Party removing the Director shall indemnify the Company against any claim arising in connection with that Director's removal from office.
|
10.4
|
Except by specific written authority of the Board or where a Transaction Document expressly permits, no Director, acting singly, shall have any power or authority to represent the Company in any capacity whatsoever, other than to vote for the officers of the Company.
|
10.5
|
Meetings of the Board shall (unless the Parties otherwise agree) take place in a mutually agreed location and in accordance with this Agreement and in the manner prescribed by the Constitutional Documents thereof at such time or times as may be required, but in any event not less frequently than four times in each calendar year. Any Director may call a meeting of the Board. Items for inclusion on the agenda of the meeting can be proposed by any Director at all times at least two (2) working days prior to such meeting.
|
10.6
|
A meeting of the Board can take place either by the physical presence of the Directors or, to the extent permitted by law, by way of telephone conference call or video conference call.
|
10.7
|
The quorum for the transaction of business at any meeting of the Directors of the Company shall be one (1) A Director and one (1) B Director. However, if a quorum is not present within two hours after the appointed time for a meeting, the meeting shall be adjourned to a date falling one day after the appointed time for the meeting, and in the adjourned meeting, any two Directors of the Company shall form a quorum.
|
10.8
|
The quorum requirements for a meeting of Directors shall be considered satisfied if satisfied at the time the meeting proceeds to business, regardless of whether or not a Director subsequently absents him or herself, provided that at least two Directors remain present.
|
10.9
|
Each Party acknowledges that any Director of the Company may by giving written notification to the Company nominate his co-Director (or any such other person appointed by one Party, who shall be approved in writing by the other Party, such approval not to be unreasonably withheld or delayed) to be his alternate Director in case of unavailability for a meeting of the Board.
|
10.10
|
The quorum for the transaction of business at any meeting of the shareholders of the Company shall be one (1) representative of the holder of the A Shares and one (1) representative of the holder of the B Shares. However, if a quorum is not present within two hours after the appointed time for a meeting, the meeting shall be adjourned to a date falling one day after the appointed time for the meeting, and in the adjourned meeting, any one shareholder of the Company shall form a quorum.
|
10.11
|
The quorum requirements for a meeting of shareholders shall be considered satisfied if satisfied at the time the meeting proceeds to business, regardless of whether or not a shareholder subsequently absents him- or herself, provided that at least one shareholder remains present.
|
10.12
|
The agenda of the shareholders' meeting may be proposed by any shareholder at any time but always at least seven (7) days prior to the proposed meeting.
|
10.13
|
The chairman of any meeting of the Board or of any meeting of the shareholders of the Company shall not have a casting vote, if there is equality of votes on any matter.
|
10.14
|
All votes on any meeting of the shareholders shall be taken on the basis of one vote for each Share held by each shareholder (and not on a show of hands).
|
10.15
|
To the extent permitted by law, the Board may adopt a resolution without holding a meeting if all the Directors approve the resolution by placing their signatures on the original copy of the resolution (or, if not practical, a certified copy thereof). The duly signed resolution shall be delivered to the Chairman and placed in the minute book of the Company kept at the registered office thereof or at such other place as the Directors may from time to time unanimously decide.
|
10.16
|
Unless and to the extent that responsibility for specific matters affecting the Rig, the Approved Finance and/or the Company have been expressly delegated to a particular Director, Directors or a Board committee, decisions shall be taken or resolutions passed by the Board and/or (as may be required) the shareholders of the Company shall be decided by a simple majority of votes cast. It is agreed that Reserved Matters shall be decided by the Parties (in their capacity as shareholders) on the basis of unanimity.
|
11
|
Dividend Policy
|
11.1
|
The Parties, in their capacity as shareholders in the Company, shall from time to time agree the dividend policy in relation to the Company.
|
11.2
|
The Parties agree that, in principle, the maximum amount possible of available cash shall be payable to them by way of dividend by the Company each year having regard to retention in the Company of reasonable amounts of working capital, reserves and/or requirements related to any Approved Finance or in accordance with prudent business practice and any applicable law.
|
12
|
Deadlock
|
12.1
|
There is a deadlock if a resolution is proposed at a properly convened meeting of the shareholders of the Company or the Board and where the Directors or shareholders of the Company are unable to reach a unanimous decision on any Reserved Matter on which a vote is taken, provided that this does not include item (g) of the Reserved Matters set out in Schedule 1.
|
12.2
|
Either Party may, within five (5) days of a deadlock arising in accordance with Clause 12.1 above (the first day being the day after the relevant meeting), serve notice on the other Party (a
Deadlock Notice
):
|
(a)
|
stating that in its opinion a deadlock has occurred; and
|
(b)
|
identifying the matter giving rise to the deadlock.
|
12.3
|
The Parties undertake that, after service of a Deadlock Notice in accordance with Clause 12.2, they shall use all reasonable endeavours in good faith to resolve the dispute within ten (10) days of the date of receipt of the Deadlock Notice (the
Consensual Resolution Period
)
,
including the prompt submission of the relevant dispute to the chief executive or managing director of each of the Parties for their resolution within the Consensual Resolution Period.
|
12.4
|
If such a deadlock is not resolved within the Consensual Resolution Period, then either Party may issue a notice offering to buy the other Party’s Shares for the Exit Amount determined in accordance with Clause 13.2. The receiving Party shall revert within fourteen (14) days failing which it shall be deemed that the receiving Party agrees to sell its Shares to the offering Party. The receiving Party may reject the offer from the offering Party but, in such circumstances, shall be required to buy the offering Party’s Shares for the Exit Amount determined in respect of such Shares in accordance with Clause 13.2 and otherwise on the same terms offered by the offering Party and the offering Party shall sell its Shares to the receiving Party on such terms.
|
13
|
Default
|
13.1
|
If a Party (the
affected Party
):
|
(c)
|
commits any repudiatory breach of this Agreement which is not capable of being remedied;
|
(d)
|
commits any repudiatory breach under the Agreement and fails to take appropriate steps to remedy such breach (if capable of remedy) within thirty (30) days after being given notice to do so by the other Party;
|
(e)
|
goes into liquidation, whether compulsory or voluntary (except for the purposes of a bona fide reconstruction or amalgamation);
|
(f)
|
has an administrator or receiver and manager appointed over any part of the assets or undertaking of that shareholder; or
|
(g)
|
becomes insolvent or is unable to pay its debts or admits in writing its inability to pay its debts as they fall due or enters into any composition or arrangement with its creditors or makes a general assignment for the benefit of its creditors,
|
13.2
|
In the circumstances contemplated in Clauses 12.4 or 13.1 above, the following provisions shall apply:
|
(a)
|
the transfer of Shares shall be effected in accordance with the provisions of Clause 15;
|
(b)
|
simultaneous with completion of the transfer of the Shares in accordance with Clause 12.4 or Clause 13.1, the transferor of the Shares shall be entitled to receive an amount (paid in accordance with this Clause 13) calculated in accordance with the following formula (the Exit Amount):
|
(c)
|
Notwithstanding the aforementioned provisions of this Clause 13.2, the Parties agree to act in good faith and in a timely manner to ensure that all necessary steps are taken and consents obtained with regard to arrangements in place in respect of any Approved Finance and any Shareholder Contributions (in the form of Shareholder Loans) to be restructured or refinanced (as appropriate) such that the Party holding all the Shares in the Company (as a result of the circumstances set out in Clause 12.4 or this Clause 13.2) becomes solely responsible for any Approved Finance and/or the Shareholder Contributions with effect from the date when the transfer of all the applicable Shares in the Company is completed.
|
13.3
|
None of the foregoing provisions of this Clause 13 shall be construed, or operate as a waiver of the rights of a Party to claim compensation for any loss suffered or incurred by that Party as a consequence of a breach of this Agreement by the other Party and whether that loss is suffered or incurred before or after such a termination.
|
13.4
|
Without prejudice to the rights and obligations expressed in this Clause 13 (which shall survive termination), this Agreement shall be terminated immediately upon the occurrence of payment of the Exit Amount and the transfer of the affected Party's Shares in accordance with Clause 15 following the exercise by the non-defaulting
|
14
|
Termination
|
14.1
|
If either Party wishes to terminate this Agreement (and such Party is not, at such time, in default of its obligations under this Agreement (whether or not a Default Notice has been issued by the other Party in accordance with the provisions of Clause 13.1 in which situation the provisions of Clause 13.2 shall apply)), then that Party may serve a termination notice (a
Termination
Notice
) on the other Party setting out the bona fide terms on which it is proposing to sell its Shares and identifying the buyer. In the case of a sale by NADL, the intended buyer (or its affiliate or third party representative advised to Jurong) must also have the capacity to take over the duties of the Approved Manager with no less competence than the Approved Manager.
|
14.2
|
Within ten (10) days after a Termination Notice is served, the Party receiving the Termination Notice shall notify the other Party whether it wishes to acquire the Shares on the terms set out in the Termination Notice. Failure to so notify the Party who has served the Termination Notice shall be deemed to be non-acceptance of the offer to acquire the Shares on the terms set out in the Termination Notice and shall entitle the Party serving the Termination Notice to sell its Shares on the terms set out in the Termination Notice and to the party identified in such notice but not on any other terms and subject always to Clause 7.4 and the buyer of the Shares entering into a deed of adherence in respect of this Agreement.
|
15
|
Transfer of Shares
|
15.1
|
Save as expressly provided in this Agreement no Party shall transfer, grant any security interest over, or otherwise dispose of or give any person any rights in or over, any share or interest in any share in the Company unless it is agreed in writing by the other Party.
|
15.2
|
Subject to Clause 15.1, a Party transferring its Shares shall:
|
(a)
|
transfer such shares with full title guarantee and free from all encumbrances, save for any encumbrances under any Approved Finance;
|
(b)
|
execute such stock transfer forms and any other documents which may be necessary to effect the transfer of all legal and beneficial title in such shares to the transferee;
|
(c)
|
promptly deliver to the transferee any and all Share Certificates in respect of the transferred shares; and
|
(d)
|
procure the resignation of any Directors appointed by the transferor party.
|
15.3
|
Where a Party transfers its Shares to the other Party whether under this Agreement or otherwise, the transferee agrees to indemnify the transferor against any proven loss or damage suffered or incurred by the transferor and arising from events or circumstances following the transfer of the Party’s Shares in accordance with this Agreement in relation to the operation of the Company and/or in connection with the Approved Finance during the period from the transfer of the Party's Shares until the Party is released from its obligations under the Approved Finance.
|
16
|
Parties Duties to Each Other
|
16.1
|
The Parties undertake with each other to exercise their rights as shareholders in a manner consistent with this Agreement and so as to ensure that the Company fully and promptly observes, performs and complies with this Agreement and the transactions contemplated herein.
|
17
|
Confidentiality
|
17.1
|
Each Party will (and will procure that any director appointed by it hereunder, any employee, adviser, agent or representative will) keep confidential and will not disclose to any person:
|
17.1.1
|
the details of this Agreement, the details of the negotiations leading to this Agreement, and the information handed over to such Party during the course of negotiations, as well as the details of all the transactions or agreements contemplated in this Agreement; and
|
17.1.2
|
any confidential information relating to the business or the operations and affairs of the Parties and the Company.
|
17.2
|
The obligation of confidentiality placed on the Parties in terms of this Clause 17 shall cease to apply in respect of any information which:
|
17.2.1
|
is or becomes generally available to the public other than by the negligence or default of any Party or by the breach of this Agreement;
|
17.2.2
|
has lawfully become known by or come into the possession of any Party on a non confidential basis from a source other than any other Party, having the legal right to disclose same;
|
17.2.3
|
is disclosed pursuant to a requirement or request from any applicable regulatory authority, recognised stock exchange, or by operation of law, regulation or court order, to the extent of compliance with such requirement or request only and not for any other purpose and provided that the disclosing Party informs the other Party of the nature of the disclosure prior to such disclosure being made.
|
17.3
|
Before any public announcement or statement is made by any Party in relation to the Company, the Party issuing such public announcement or statement shall use its best endeavours to (a) provide the other Party, with a written draft of the proposed announcement or statement at least three (3) Business Days before the proposed time of the announcement, and (b) agree the wording and timing of such announcement or statement with the other Party.
|
17.4
|
No Party shall be entitled to use by name, or make reference to, the participation of any other Party hereto in the capital of the Company or ownership of the Company, without the prior written consent of such other Party, such consent not to be unreasonably withheld or delayed.
|
17.5
|
Notwithstanding the terms of this Clause 17, the Parties may disclose any
information
which they would otherwise be prohibited from doing so, to their direct and indirect shareholders or investors and the directors, employees, agents, professional advisers or consultants of any such direct or indirect shareholders or investors, to any bona fide prospective shareholders or investors or their professional advisers or consultants, and to any bona fide third party prospective purchasers of the shares held by them, provided that any such Party procures that any such recipient is bound to substantially the same obligations of confidentiality contained therein.
|
17.6
|
The provisions of this Clause 17 shall continue in force notwithstanding the termination of this Agreement for any reason.
|
18
|
Waiver
|
19
|
Costs
|
20
|
Anti-Bribery and Anti-Corruption
|
20.1
|
The Parties shall each do all that is necessary and within their respective power and control to ensure that the Company will not at any time offer, promise, give or receive any improper financial payment and/or other
improper
advantage to or from any person, customer or supplier (whether a public official or otherwise) with the intention of influencing them and obtaining or retaining an advantage in the conduct of the business of the Company.
|
20.2
|
In order to promote the achievement of the objectives set out in clause 20.1, the Company shall:
|
20.2.1
|
adopt, apply and monitor an appropriate anti-bribery and anti-corruption policy (the "
Policy
”), that takes into account all laws applicable to the Company and the Parties and includes adequate procedures designed to prevent the behaviours referred to in this Clause 20;
|
20.2.2
|
maintain an appropriate process for employees to report, anonymously if desired, instances of bribery, corruption or fraudulent practices;
|
20.2.3
|
ensure that its employees are aware of and understand the Policy and the processes; and
|
20.2.4
|
ensure that reports are regularly presented to the Parties on the application and monitoring of the Policy and any reported incident.
|
21
|
Representations and Warranties
|
21.1
|
On the date of this Agreement and (to the extent applicable) thereafter on each day on which this Agreement remains in full force and effect, each Party represents and warrants to the other Party that:
|
(a)
|
it is a company duly organised, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated and has perpetual corporate existence and the capacity to sue or be sued in its own name, and has the power to own the property and assets that it presently owns and to continue to conduct the business it presently conducts;
|
(b)
|
it has power to enter into and perform this Agreement and has taken all necessary corporate and other action required to authorise the execution and delivery of this Agreement and its performance according to its terms;
|
(c)
|
the execution and delivery of this Agreement and its performance according to its terms do not and will not:-
|
(i)
|
contravene the constitutional documents of that Party;
|
(ii)
|
violate any law to which that Party is subject;
|
(iii)
|
result in a breach of, or default under, any agreement, instrument or arrangement to which that Party is a party or which is binding upon that Party or any of its assets.
|
22
|
Assignment
|
(a)
|
The transferor and transferee must remain within the same group (and the transferee will undertake to retransfer the shares to the transferor and the transferor will undertake to accept such retransfer) at the instruction of the remaining Party, if such group relationship ceases to be maintained;
|
(b)
|
the transferee and the transfer of the Shares would not result in a breach of the obligations of the transferor Party;
|
(c)
|
no business conflict would be created for the Company or the remaining Party as a result of the transfer of Shares; and
|
(d)
|
the transferee shall assume all rights and obligations under this Agreement, all Shareholder Loans advanced by the transferor and all other agreements, including, but not limited to, the execution of a deed of adherence in respect of this Agreement.
|
23
|
Third Party Rights
|
24
|
Severability
|
25
|
Entire Agreement
|
26
|
Supremacy of Agreement
|
27
|
Notices, etc
|
27.1
|
Any notice or other communication hereunder (a “
Communication
”) shall be in the English language and be sent by letter or facsimile transmission addressed as follows (or as the intended recipient shall have notified the sender in accordance with this Clause 27):
|
(a)
|
if to Jurong:
|
(b)
|
if to NADL:
|
Address:
|
c/o Seadrill Management Ltd., 2
nd
Floor, Building 11, Chiswick Business Park, 566 Chiswick High Road, London W4 5YS, United Kingdom
|
28
|
No Partnership
|
29
|
Variation and Counterparts
|
30
|
Consequential Loss
|
30.1
|
Neither Party shall in any circumstances be liable to the other Party for:
|
(a)
|
loss of and/or deferral of business, loss of profit, loss of revenue, profit or anticipated profit, loss of contract, goodwill or reputation, in each case whether direct or indirect and whether or not foreseeable at the date of this Agreement;
|
(b)
|
any consequential loss or indirect loss under English law,
|
31
|
Effectiveness of this Agreement
|
31.1
|
Notwithstanding the signature of this Agreement by the Parties, this Agreement shall come into force in accordance with the provisions of clause 7.1.2 of Amendment No. 1.
|
32
|
Governing Law and Jurisdiction
|
32.1
|
This Agreement shall be governed by and construed in accordance with the laws of England.
|
32.2
|
Any disputes arising out of or in connection with this Agreement including any question regarding its existence, validity or termination shall be referred to and finally resolved by arbitration in Singapore administered by the Singapore International Arbitration Centre (“
SIAC
”) in accordance with the Arbitration Rules of the Singapore International Arbitration Centre for the time being in force, which rules are deemed to be incorporated by reference in this Clause. The number of arbitrators shall be three (3), one to be appointed by each Party and the third arbitrator to be appointed by the chairman of SIAC.
|
Schedule 1
|
Reserved Matters
|
(a)
|
Any decision relating to any borrowing or raising of money not included in the annual budget.
|
(b)
|
The giving by the Company of any guarantee, security or similar assurance against loss.
|
(c)
|
The amalgamation, reconstruction or voluntary liquidation of the Company and potential subsidiaries of the Company.
|
(d)
|
Any proposal to appoint a receiver or similar officer for the Company or over substantially all the assets of the Company.
|
(e)
|
Any proposal for the listing of any shares in the Company on any stock exchange.
|
(f)
|
To approve the annual budget of the Company.
|
(g)
|
The entry into any Bareboat Charter other than a Bankable Drilling Contract.
|
(h)
|
*****
|
(i)
|
The decision to make a Shareholder Contribution, its terms and any amendment of those terms (other than any which the Parties are required to make under Clauses 5.3 and 6.1(e)).
|
S/N
|
Sub System
|
Section
|
Test Package No
|
Item No
|
Compart
.
|
Incharge By
|
Tag No
|
Tag Description
|
Punch List Description
|
AB
|
Raised By
|
Raised Date
|
Cleared By
|
Cleared Date
|
Champion
|
20
|
665.01
|
PM
|
665.01
|
PL-C223
1
|
U 00 57
|
Jackie
|
|
|
Fire resistant fuel hoses req's for both engine fuel hoses
& fuel supply line to fuel tank & protection seals.
|
A
|
Steve Hunt
|
07/10/15
|
|
|
Jackie
|
21
|
665.01
|
PM
|
665.01
|
PL-C223 8
|
U 00 57
|
Jackie
|
|
|
Alternator cables are open ended & not connected to a starter & batteries, this will result in destroying the
alternator (CAR to be issued).
|
A
|
Steve Hunt
|
07/10/15
|
|
|
Jackie
|
22
|
665.01
|
PM
|
665.01
|
PL-C223
9
|
U 00 57
|
Jackie
|
|
|
There are no means of connecting the batteries to the
electric starter motor. (CAR to be issued).
|
A
|
Steve Hunt
|
07/10/15
|
|
|
Jackie
|
23
|
761.01
|
DN
|
761.01
|
PL-C232
9
|
M 00 08
|
LIAU
|
|
|
Engineering to solve Expansion tank issue & lack of
pressure on Hot Water supply (1 Bar).
|
A
|
Steve Hunt
|
05/11/15
|
|
|
Eric
|
24
|
761.01
|
PM
|
761.01
|
PL-C233 4
|
M 00 08
|
Eric
|
|
|
Stbd unit - Steam condenser line tied into sea water discharge line. To be removed from this line & re-routed
to somewhere else, causing too high a discharge pressure.
|
A
|
Steve Hunt
|
05/11/15
|
|
|
Eric
|
25
|
867.21
|
PM
|
867.21
|
PL-C019
4
|
A 00 13
|
RAJIV
|
|
|
Heating element SN-13-00336-4 testing Om & E on
U3-EaV3-E.
|
A
|
Gordon
|
04/06/15
|
|
|
Sanyin
|
26
|
875.24
|
PM
|
875.24
|
PL-C154
9
|
M 00 18
|
RAJIV
|
|
|
875EL024-03-L01 - Change to EB
|
A
|
Jorstin
|
14/09/15
|
|
|
Rajiv
|
S/N
|
Sub System
|
Section
|
Test Package No
|
Item No
|
Compart
.
|
Incharge By
|
Tag No
|
Tag Description
|
Punch List Description
|
AB
|
Raised By
|
Raised Date
|
Cleared By
|
Cleared Date
|
Champion
|
1
|
579.61
|
PM
|
579GA008A
|
PL-M128
9
|
T 00 26
|
VENDOR
|
579GA008A
|
Air Handling Unit
AC-8A
|
Update XY on steam inlets and outlets.
|
A
|
WILHEL
|
21/01/14
|
|
|
Afiq
|
2
|
579.61
|
PM
|
579GA008B
|
PL-M129
0
|
T 00 26
|
VENDOR
|
579GA008B
|
Air Handling Unit
AC-8B
|
Update XY on steam inlets and outlets.
|
A
|
WILHEL
|
21/01/14
|
|
|
Afiq
|
S/N
|
Sub System
|
Section
|
Test Package No
|
Item No
|
Compart
.
|
Incharge By
|
Tag No
|
Tag Description
|
Punch List Description
|
AB
|
Raised By
|
Raised Date
|
Cleared By
|
Cleared Date
|
Champion
|
1
|
571.08
|
PM
|
571.08-H-001(S
)
|
PL-H223
3
|
Q 04 73
|
AFIQ
|
|
|
Temperature fuse damaged to be changed.
|
A
|
Shafi
|
15/06/15
|
|
|
|
A)
|
Key issues to be performed after Technical Acceptance
|
1.
|
BOP & Diverter Controls FAT to be redone after technical acceptance with Seadrill attendance.
|
2.
|
UK Safety Case gap analysis to be conducted by DNVGL, gaps identified will be managed and resolved after technical acceptance. DNVGL to issue statement of fact when the gaps are resolved.
|
3.
|
Anchor chain haul-in issue will be resolved after the technical acceptance.
|
4.
|
Portable handling tools as per materials handling plan, top drive adaptor tool and split gimbal shall be delivered after technical acceptance but before rig delivery.
|
B)
|
Punch List
|
1.
|
A-punch in EPCC –
29
|
2.
|
B-punch in EPCC –
1161
|
3.
|
Punches converted from CAR 2000~2036 + CAR 966/1012 –
806
|
4.
|
Punches converted from CAR 1009 -
150
|
5.
|
Ex-List survey punch –
56
|
6.
|
Mandatory survey NMA, CAA and NIPH :
27
(NMA survey in progress)
|
7.
|
Commissioning related activity punches - in progress
|
C)
|
CAR (Corrective action report)
|
S/N
|
CAR NO
|
DATE
|
DESCRIPTION
|
Reason
|
1
|
CAR-574
|
06-May-15
|
Top Drive TDX-100
|
Loose item to be delivered before delivery
|
2
|
CAR-618
|
25-May-15
|
Insufficient Headroom- BOP Equipment Room
|
To be closed by RA; Seadrill will evaluate the RA pending approval
|
3
|
CAR-873
|
09-Sep-15
|
LQ - Installation of SEMCO panel in MCR
|
Accepted by Seadrill
|
4
|
CAR-903
|
22-Sep-15
|
Whole Rig - 513.02- water tight Closing means
|
Duplicated with NMA recommendation; Closed
|
5
|
CAR-937
|
05-Oct-15
|
Rig Wide - 425.01 PAGA system
|
Duplicated with NMA recommendation; Closed
|
6
|
CAR-953
|
09-Oct-15
|
LQ - joiner doors in LQ - gasket
|
Duplicated with NMA recommendation; Closed
|
7
|
CAR-965
|
19-Oct-15
|
RIG - Request for testing for BOP control system
|
Closed; BOP FAT will be done after Technical acceptance
|
8
|
CAR-967
|
27-Oct-15
|
Chain locker - Storing of chain in lockers ( R-1 )
|
Closed; will be solved after Technical acceptance
|
9
|
CAR-977
|
09-Nov-15
|
ballast tanks - Insufficient Ballast capacity
|
Seadrill to confirm
|
10
|
CAR-996
|
18-Nov-15
|
Rig While - Noise Measurements
|
Closed; finding transfer to punch
|
11
|
CAR-1003
|
11-Nov-15
|
Rig wide - All cooling systems
|
Closed; under maintenance program
|
12
|
CAR-1008
|
20-Nov-15
|
BOP - BOP control system non-conformity
|
Closed; BOP FAT will be done after Technical acceptance
|
13
|
CAR-1009
|
20-Nov-15
|
BOP - BOP Integrated system and BOP control system commissioning discrepancies
|
Closed; BOP FAT will be done after Technical acceptance
|
14
|
CAR-1011
|
26-Nov-15
|
Rig Wide - TQ G241 need to reply for UK Safety Case.
|
Closed; will be solved after Technical acceptance
|
15
|
CAR-1012
|
26-Nov-15
|
Rig Wide- Emergency illumination
|
Closed; finding transfer to punch
|
S/N
|
CAR NO
|
DATE
|
DESCRIPTION
|
Reason
|
1
|
CAR-2000
|
13-Oct-15
|
Mechanical / SFI 440
|
Closed; finding transfer to punch
|
2
|
CAR-2001
|
13-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
3
|
CAR-2002
|
14-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
4
|
CAR-2003
|
14-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
5
|
CAR-2004
|
14-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
6
|
CAR-2005
|
29-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
7
|
CAR-2006
|
29-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
8
|
CAR-2007
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
9
|
CAR-2008
|
29-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
10
|
CAR-2009
|
29-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
11
|
CAR-2010
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
12
|
CAR-2011
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
13
|
CAR-2012
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
14
|
CAR-2013
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
15
|
CAR-2014
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
16
|
CAR-2015
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
17
|
CAR-2016
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
18
|
CAR-2017
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
19
|
CAR-2018
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
20
|
CAR-2019
|
30-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
21
|
CAR-2020
|
31-Oct-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
22
|
CAR-2021
|
1-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
23
|
CAR-2022
|
2-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
24
|
CAR-2023
|
3-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
25
|
CAR-2024
|
4-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
26
|
CAR-2025
|
5-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
27
|
CAR-2026
|
6-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
28
|
CAR-2027
|
7-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
29
|
CAR-2028
|
8-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
30
|
CAR-2029
|
9-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
31
|
CAR-2030
|
10-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
32
|
CAR-2031
|
11-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
33
|
CAR-2032
|
12-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
34
|
CAR-2033
|
13-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
35
|
CAR-2034
|
14-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
36
|
CAR-2035
|
15-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
37
|
CAR-2036
|
16-Nov-15
|
Mechanical SFI or Compt - Audit Findings
|
Closed; finding transfer to punch
|
D)
|
Risk assessment
|
Name of company
|
Country of Incorporation
|
Principal activities
|
Percent owned
|
|
|
|
|
Drilling unit owning companies
|
|
|
|
|
|
|
|
Asia Offshore Rig 1 Ltd
|
Bermuda
|
Owner of AOD 1
|
66.23%
|
Asia Offshore Rig 2 Ltd
|
Bermuda
|
Owner of AOD 2
|
66.23%
|
Asia Offshore Rig 3 Ltd
|
Bermuda
|
Owner of AOD 3
|
66.23%
|
Sevan Brasil Ltd
|
Bermuda
|
Owner of Sevan Brasil
|
50.11%
|
Sevan Drilling Rig VI Pte Ltd
|
Singapore
|
Owner of Sevan Developer no. 4
|
50.11%
|
Sevan Driller Ltd
|
Bermuda
|
Owner of Sevan Driller
|
50.11%
|
Sevan Louisiana Hungary KFT
|
Hungary
|
Owner of Sevan Louisiana
|
50.11%
|
North Atlantic Alpha Ltd
|
Bermuda
|
Owner of West Alpha
|
70.36%
|
Seadrill Aquila Ltd
|
Bermuda
|
Owner of West Aquila
|
100.00%
|
Seadrill Ariel Ltd.
|
Liberia
|
Owner of West Ariel
|
100.00%
|
Seadrill Callisto Ltd
|
Bermuda
|
Owner of West Calisto
|
100.00%
|
Seadrill Carina Ltd
|
Bermuda
|
Owner of West Carina
|
100.00%
|
Seadrill Castor Ltd
|
Bermuda
|
Owner of West Castor
|
100.00%
|
Seadrill Cressida Ltd
|
Bermuda
|
Owner of West Cressida
|
100.00%
|
Seadrill Dione Ltd
|
Bermuda
|
Owner of West Dione
|
100.00%
|
Seadrill Dorado Ltd
|
Bermuda
|
Owner of West Dorado
|
100.00%
|
Seadrill Draco Ltd
|
Bermuda
|
Owner of West Draco
|
100.00%
|
Seadrill Eclipse Ltd
|
Bermuda
|
Owner of West Eclipse
|
100.00%
|
North Atlantic Elara Ltd
|
Bermuda
|
Owner of West Elara
|
70.36%
|
Seadrill Eminence Ltd
|
Bermuda
|
Owner of West Eminence
|
100.00%
|
North Atlantic Epsilon Ltd
|
Bermuda
|
Owner of West Epsilon
|
70.36%
|
Seadrill Freedom Ltd
|
Bermuda
|
Owner of West Freedom
|
100.00%
|
Seadrill Gemini Ltd
|
Bermuda
|
Owner of West Gemini
|
100.00%
|
Seadrill Hyperion Ltd
|
Bermuda
|
Owner of West Hyperion
|
100.00%
|
Seadrill Jupiter Ltd.
|
Bermuda
|
Owner of West Jupiter
|
100.00%
|
Seadrill Indonesia Ltd
|
Bermuda
|
Owner of West Leda
|
100.00%
|
Seadrill Libra Ltd
|
Bermuda
|
Owner of West Libra
|
100.00%
|
Seadrill Mimas Ltd
|
Bermuda
|
Owner of West Mimas
|
100.00%
|
Seadrill Mira Ltd
|
Bermuda
|
Owner of West Mira
|
100.00%
|
Scorpion Rigs Ltd
|
Bermuda
|
Owner of West Mischief
|
100.00%
|
North Atlantic Navigator Ltd
|
Bermuda
|
Owner of West Navigator
|
70.36%
|
Seadrill Neptune Hungary KFT
|
Bermuda
|
Owner of West Neptune
|
100.00%
|
Seadrill Orion Ltd
|
Bermuda
|
Owner of West Orion
|
100.00%
|
Seadrill Pegasus Pte Ltd
|
Singapore
|
Owner of West Pegasus
|
100.00%
|
North Atlantic Pheonix Ltd
|
Bermuda
|
Owner of West Phoenix
|
70.36%
|
Seadrill Prospero Ltd
|
Bermuda
|
Owner of West Prospero
|
100.00%
|
Seadrill Proteus Ltd
|
Bermuda
|
Owner of West Proteus
|
100.00%
|
Scorpion Resolute Ltd
|
Bermuda
|
Owner of West Resolute
|
100.00%
|
Seadrill Rhea Ltd
|
Bermuda
|
Owner of West Rhea
|
100.00%
|
North Atlantic Rigel Ltd
|
Bermuda
|
Owner of West Rigel
|
70.36%
|
Seadrill Saturn Ltd
|
Bermuda
|
Owner of West Saturn
|
100.00%
|
Seadrill Telesto Ltd
|
Bermuda
|
Owner of West Telesto
|
100.00%
|
Seadrill Tellus Ltd
|
Bermuda
|
Owner of West Tellus
|
100.00%
|
Seadrill Tethys Ltd
|
Bermuda
|
Owner of West Tethys
|
100.00%
|
Seadrill Titan Ltd
|
Bermuda
|
Owner of West Titan
|
100.00%
|
Seadrill Triton Ltd
|
Bermuda
|
Owner of West Triton
|
100.00%
|
Seadrill Tucana Ltd
|
Bermuda
|
Owner of West Tucana
|
100.00%
|
Seadrill Umbriel Ltd
|
Bermuda
|
Owner of West Umbriel
|
100.00%
|
North Atlantic Venture Ltd
|
Bermuda
|
Owner of West Venture
|
70.36%
|
Scorpion Vigilant Ltd
|
Bermuda
|
Owner of West Vigilant
|
100.00%
|
|
|
|
|
Drilling units under sale leaseback
|
|
|
|
|
|
|
|
SFL Deepwater Ltd*
|
Bermuda
|
Owner of West Taurus
|
—%
|
SFL Hercules Ltd*
|
Bermuda
|
Owner of West Hercules
|
—%
|
SFL Linus Ltd*
|
Bermuda
|
Owner of West Linus
|
—%
|
|
|
|
|
Contracting and management companies
|
|
|
|
|
|
|
|
North Atlantic Crew AS
|
Norway
|
Crewing Company
|
70.36%
|
North Atlantic Crewing Ltd (Bermuda)
|
Bermuda
|
Crewing Company
|
70.36%
|
North Atlantic Drilling UK Ltd
|
United Kingdom
|
Drilling services contractor
|
70.36%
|
North Atlantic Management AS
|
Norway
|
Management company
|
70.36%
|
North Atlantic Norway Ltd
|
Bermuda
|
Drilling services contractor
|
70.36%
|
North Atlantic Support Services Ltd
|
United Kingdom
|
Management company
|
70.36%
|
Sea Dragon de Mexico S. de R.L. de C.V.
|
Mexico
|
Management company
|
100.00%
|
Seadrill Americas Inc.
|
USA
|
Drilling services contractor and technical services company
|
100.00%
|
Seadrill Deepwater Contracting Ltd
|
Bermuda
|
Contracting company
|
100.00%
|
Seadrill Deepwater Crewing Ltd
|
Bermuda
|
Crewing company
|
100.00%
|
Seadrill Deepwater Units Pte Ltd.
|
Singapore
|
Management company
|
100.00%
|
Seadrill Insurance Ltd.
|
Bermuda
|
Insurance company
|
100.00%
|
Seadrill Management (S) Pte Ltd
|
Singapore
|
Management company
|
100.00%
|
Seadrill Management AME Ltd.
|
Bermuda
|
Management company
|
100.00%
|
Seadrill Management AS
|
Norway
|
Management company
|
100.00%
|
Seadrill Management Limited
|
United Kingdom
|
Management company
|
100.00%
|
Seadrill Management Services Ltd
|
British Virgin Islands
|
Management company
|
100.00%
|
Seadrill Offshore AS
|
Norway
|
Drilling services contractor
|
100.00%
|
Seadrill Offshore Singapore Pte Ltd
|
Singapore
|
Management company
|
100.00%
|
Seadrill Servicos de Petroleo Ltda.
|
Brazil
|
Drilling services contractor
|
100.00%
|
|
|
|
|
Holding Companies
|
|
|
|
|
|
|
|
North Atlantic Drilling Ltd
|
Bermuda
|
Holding Company
|
70.36%
|
Seadrill Common Holdings Ltd
|
Bermuda
|
Holding Company
|
100.00%
|
Seadrill Deepwater Holdings Ltd
|
Bermuda
|
Holding Company
|
100.00%
|
Seadrill Jack Up Holding Ltd
|
Bermuda
|
Holding Company
|
100.00%
|
Seadrill Member LLC
|
Marshall Islands
|
Holding Company
|
100.00%
|
Seadrill UK Ltd
|
United Kingdom
|
Holding Company
|
100.00%
|
SeaMex Ltd
|
Bermuda
|
Holding Company
|
100.00%
|
Sevan Drilling ASA
|
Norway
|
Holding Company
|
50.11%
|
Sevan Drilling Ltd
|
Bermuda
|
Holding Company
|
50.11%
|