Seadrill Limited · NYSE:SDRL
Seadrill — Pareto Securities 25th Oil & Offshore Conference 2018
24 slides from Seadrill's conference presentation, Sep 12, 2018
Slide 1: Seadrill Investor Presentation
Seadrill Investor Presentation Pareto Securities Oil & Offshore Conference, Oslo 12 September 2018
Slide 2: Disclaimer
Disclaimer We have prepared this document solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. The information contained h
Slide 3: Agenda
Agenda ▪ Restructured and strengthened balance sheet ▪ Our business ▪ Market development ▪ Investment proposition 3
Slide 4: Restructured and strengthened balance sheet
Restructured and strengthened balance sheet
Slide 5: Restructured and strengthened balance sheet
Restructured and strengthened balance sheet USD ▪ c.$6 billion of debt and other liabilities removed 12.6bn ▪ Raised $1.08 billion of fresh capital Seabras Seadrill Partners Seamex ‒ $880 million of New Secured Notes Archer USD ‒ $200 million of New Equity 7.4bn ▪ $2.1 billion cash at emergence ‒ $1
Slide 6: Our business
Seadnill Our business
Slide 7: Our business
Our business ▪ Seadrill Ltd. consolidated (includes AOD): Drilling Non- Drilling ‒ 35 delivered rigs ‒ 9 newbuilds 20 Floaters, 21 Jackups 0% 66% ▪ Managed drilling rigs: 4 Floaters 3 Jack-ups ‒ 16 delivered rigs on behalf of Seadrill 35% 50% Partners and Seamex ‒ 4 newbuilds on behalf of Northern D
Slide 8: The Seadrill franchise
The Seadrill franchise Total Delivered: Floaters 19 8 - - 27 Jack-Ups/Tenders 16 3 5 - 24 Total Delivered 35 11 5 - 51 Newbuilds: Floaters 1 - - 4 5 Jack-Ups/Tenders 8 - - - 8 Total Fleet 44 11 5 4 64 Backlog $2.2 bn $1.2 bn $1.3 bn $0.1 bn $4.8 bn 8
Slide 9: Our joint ventures and investment holdings
Our joint ventures and investment holdings ▪ Seadrill owns: ▪ 50/50 joint venture with Fintech ‒ 35% stake in SDLP common units (c.$300 million market cap) ▪ 5 high-spec jack-ups ‒ 16 million subordinated units ▪ $1.3 billion of backlog with PEMEX as of ‒ 49% stake in Seadrill Capricorn Holdings Aug
Slide 10: Improving our competitive position
Improving our competitive position ▪ Integrated Services Integrated Services ‒ Full suite of third party services e.g. ROV, casing, cuttings, logistics ▪ Managed Pressure Drilling Plato Integrated ‒ First Column Stabilized Drilling Unit to receive the ABS MPD Performance Management notation ▪ Integr
Slide 11: Securing new contracts
Securing new contracts Backlog awarded during restructuring1 Jack-ups: $39 million Floaters BE: $215 million Floaters HE: $156 million West Gemini West Hercules West Tucana ▪ Working for Eni, Angola ▪ Working for Siccar Point, ▪ Working for GDI, Qatar ▪ Recently excised options UK and Equinor Norway
Slide 12: Market development
Seadnill Market development
Slide 13: …Market showing signs of a recovery…
…Market showing signs of a recovery… Upstream spending is increasing… …as is contracting activity… …and utilization Upstream E&P Spend (CAPEX) Fixture Awards Total Fleet Utilization $ billion (as of May 2018) # awards % Floaters 886 Floaters Jackups Other onshore Jackups Shale/Tight oil Offshore 670
Slide 14: …and this is reflected in increased contracting activity
…and this is reflected in increased contracting activity Harsh Environment Floaters Benign Environment Floaters Premium Jack-ups1 Fixture Fixture Fixture Dayrates Dayrates Dayrates (USDk) (USDk) (USDk) 400 400 200 300 300 150 200 200 100 100 100 50 - - - May-18 May-19 Feb-18 Feb-19 Feb-20 Nov-17 Nov
Slide 15: Investment proposition
Seadnill Investment proposition
Slide 16: Our investment proposition
Our investment proposition ▪ Scale with a modern fleet ▪ Competitive cost structure ▪ Proven track record of safe and efficient operations ▪ Restructured balance sheet provides five year runway and enables contracting discipline 16
Slide 17: Scale: significant global presence
Scale: significant global presence ▪ 4300 employees in 24 countries Ultra Deepwater ▪ Corporate office in London, with 2 Hemisphere offices / 2 Floaters Technical Service Centers covering all major offshore markets HE Floaters2 Jack-ups Tender rigs Corporate and Hemisphere Offices Technical Services
Slide 18: Scale: large and modern fleet
Scale: large and modern fleet Seadrill and Peer Group Fleet Number of Rigs1 Tenders 57 55 Floaters 3 44 Jack-ups 32 4 24 24 24 1 1 (2) (3) Ensco Seadrill Transocean Rowan Noble Maersk Borr Diamond Ocean Rig Pacific Drilling Offshore Fleet Average Age4 Diversified Floater only Jack-up only (2) (3) Pa
Slide 19: Scale: focused in the right markets
Scale: focused in the right markets 6th & 7th Generation Floaters 100 100 94 % Total Floater 86 88 83 82 Fleet 49 41 (1) Seadrill Transocean Ensco Noble Ocean Rig Diamond Maersk Pacific Rowan Offshore Harsh Environment Floaters 100 36 29 % Total 23 Floater 17 18 9 Fleet (1) Seadrill Transocean Diamo
Slide 20: Competitive cost structure
Competitive cost structure All-in operating cost per rig1 $k/day 2 Floaters Jack-ups -49% 2015 -34% 2016 2017 Q1 2018 -48% -31% Seadrill Ltd.3 Peer Group (excludes Seadrill Ltd.3 Peer Group (excludes Seadrill Ltd.)4 Seadrill Ltd.)4 Notes: 1) All-in operating cost per rig comprises reported vessel an
Slide 21: Proven track record of safe and efficient operations
Proven track record of safe and efficient operations Total Incident Frequency & Total Recordable Incident Frequency Technical Utilization (%) 14 TIF TRIF 12 IADC Offshore 10 8 6 4 2 0 Jul-15 Jul-16 Jul-17 Apr-15 Apr-16 Apr-17 Apr-18 Jan-15 Oct-15 Jan-16 Oct-16 Jan-17 Oct-17 Jan-18 2015 2016 2017 201
Slide 22: Restructured balance sheet: enables contracting discipline
Restructured balance sheet: enables contracting discipline ▪ 5-year financial runway ‒ No debt maturities until June 2022 ‒ No debt amortisation payments until Q1 2020, with the ability to defer up to Q2 2021 ‒ No financial covenants until Q1 2021, other than minimum liquidity ‒ Net leverage and DSC
Slide 23: Positioning for the recovery: illustrative returns
Positioning for the recovery: illustrative returns Illustrative Equity Returns Illustrative Return Sensitivity Increase in equity value vs change in asset value1 Increase in equity value resulting from a 10% change in enterprise value 415% 355% 42% 295% 34% 253% 26% 23% 175% 16% 115% 60% 250 300 350
Slide 24: Summary
Summary ▪ Strongly believe in an offshore market recovery ▪ Proven track record of safe and efficient operations ▪ Competitive on cost ▪ Well positioned, asset, balance sheet and liquidity wise ▪ Ability to deploy our assets intelligently and leverage the recovery 24
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