Seadrill sells three jack-ups to Shelf Drilling

  • Business & Finance

Offshore drilling contractor Seadrill has reached an agreement with Shelf Drilling to sell three jack-up drilling rigs for a total consideration of $225 million. 

The rigs included in the agreement are the West Triton, West Resolute and West Mischief.

Seadrill said on Monday that The West Triton and West Resolute are scheduled to be delivered to Shelf Drilling by the end of May 2017 and the West Mischief during the third quarter of 2017 after completion of its current drilling contract with NDC in Abu Dhabi.

The total debt outstanding on these three units is $102 million providing excess sale proceeds of $123 million. The carrying value of the three units totals $415 million. A loss on disposal of $190 million is expected to be realized for the first quarter of 2017.

With this acquisition, Shelf Drilling’s total shallow water rig count will increase from 37 to 40.

Shelf Drilling has financed the acquisition through a private placement of new Shelf Drilling common shares announced last week.

David Mullen, Chief Executive Officer, Shelf Drilling said: “All three acquired rigs are located in the Middle East, one of the key markets for Shelf Drilling. What’s also important is that the deal extends our ability to offer more options to our customers, and I am confident that these rigs will secure employment with a number of near term opportunities that exist.”

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