SDRL - Seadrill Cancels the West Mira Construction Contract
Hamilton, Bermuda, September 15, 2015 - Seadrill Limited ("Seadrill" or "The Company""), has notified Hyundai Heavy Industries Co Ltd. ("the Shipyard") that it has exercised its right to cancel the contract for the construction of the West Mira, a sixth generation ultra-deepwater harsh environment semisubmersible drilling unit ("West Mira" or "the Unit").
The Unit was ordered during the second quarter of 2012 and the delivery date stated in the construction contract was by December 31, 2014. Due to the Shipyard's inability to deliver the Unit within the timeframe required under the contract, the Company has exercised its cancellation rights.
Under the contract terms, Seadrill has the ability to recoup the $168 million in pre-delivery instalments to the Shipyard, plus accrued interest.
In the fourth quarter of 2012 Seadrill was awarded a 5 year contract for the West Mira with Husky Oil Operations Limited ("Husky") for operations in Canada and Greenland. As stated in the Company's second quarter earnings report, due to the late delivery of the Unit, the Company had tentatively agreed with Husky to reduce the dayrate of the West Mira drilling contract. Seadrill remains in discussions with Husky to find an alternative solution to meet its drilling requirements.
FORWARD LOOKING STATEMENTS
This news release includes forward looking statements. Such statements are generally not historical in nature, and specifically include statements about the Company's plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. These statements are made based upon management's current plans, expectations, assumptions and beliefs concerning future events impacting the Company and therefore involve a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, which speak only as of the date of this news release. Consequently, no forward-looking statement can be guaranteed. When considering these forward-looking statements, you should keep in mind the risks described from time to time in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 20-F (File No. 001-34667). The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for the Company to predict all of these factors. Further, the Company cannot assess the impact of each such factor on its business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward looking statement.This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.