Slide 1: Investor Presentation
Investor Presentation A U G U S T 2 0 2 4 v FOCUSED VALUE DRIVEN RESPONSIBLE
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this investor presentation that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking
Slide 3: Valaris is well positioned to deliver meaningful value to shareholders
Valaris is well positioned to deliver meaningful value to shareholders Leading Strong Valaris Earnings Offshore Industry & Cash Flow Driller Fundamentals Growth Largest and highest specification fleet in Commodity supply and demand is highly Commercial execution driving increased the industry constr
Slide 4: Leading Offshore Driller
Leading Offshore Driller 4
Slide 5: Largest fleet of high-specification assets
Largest fleet of high-specification assets Fleet Quality of Major International Offshore Drillers Q1 Q2 Q3 Q4 Floaters Q1 Q2 Q3 Q4 Avg. Age1 Valaris2 30 16 6 1 53 Transocean 36 11 Noble 19 12 Transocean 12 12 7 5 36 Valaris 18 9 Seadrill3 14 12 Shelf 7 6 11 12 36 Diamond 11 26 Noble 16 13 2 1 32 Jac
Slide 6: Strong customer relationships with major IOCs, NOCs and independents
Strong customer relationships with major IOCs, NOCs and independents Majors1 National Oil Companies and Other Select Customers1 Floaters Jackups Locations Floaters Jackups Locations ✓ ✓ Brazil, Mediterranean, Southeast Asia, Trinidad ✓ Middle East ✓ US GOM ✓ Brazil ✓ ✓ Australia, Mexico, North Sea,
Slide 7: Focused on key basins expected to drive a large share of future demand
Focused on key basins expected to drive a large share of future demand 9 North Sea & Norway 7% U.S. GOM & Mexico 1 7% Mediterranean 2 1 20% Middle East 2 11% West Africa 46% 1% 2 Trinidad Southeast Asia 4% 18% % share of expected benign environment floater demand over next five years1 10 2 12% 5% Br
Slide 8: ARO Drilling joint venture provides strong presence in the largest jackup market in the world
ARO Drilling joint venture provides strong presence in the largest jackup market in the world ARO is an unconsolidated 50/50 JV with Saudi Aramco that owns Income $497M and operates jackups in Saudi Arabia, providing a strategic Statement Revenue partnership with the largest customer for jackups in
Slide 9: Reduce emissions from our own operations and partner with customers
Reduce emissions from our own operations and partner with customers Reduce Emissions Four focus areas identified Target to reduce emissions from our own to achieve this target: intensity by Operations 1. Energy Efficient Practices 2. Energy-Saving Upgrades and Procedures 10% to 20% 3. Biofuel Blends
Slide 10: Strong Industry Fundamentals
Strong Industry Fundamentals 10
Slide 11: Commodity supply and demand is constructive for our industry
Commodity supply and demand is constructive for our industry % of P50 Reserves Global Liquid Fuels Consumption (Million Barrels Per Day) Offshore Breakeven Oil Prices for Undeveloped Reserves Cumulative % of P50 Reserves 105 100% 25 100 100 93% 95% 91% 87% 90 95 82% Demand for 20 19% 76% 80 hydrocar
Slide 12: Offshore upstream capex and new project sanctioning are expected to increase
Offshore upstream capex and new project sanctioning are expected to increase Offshore Upstream Capex ($B) Deepwater Shelf Growing demand for hydrocarbons, attractive project economics and low carbon +5% emissions intensity are expected to drive 244 256 increased investment in offshore projects 226 2
Slide 13: Demand for offshore drilling is expected to increase over the next several years
Demand for offshore drilling is expected to increase over the next several years Benign Environment Floater Demand By Wellbore Purpose (Rig Years) Exploration Production P&A and Intervention Benign environment floater demand is expected to increase at a compound annual +6% growth rate of 6% through
Slide 14: Significant supply rationalization has improved market balance
Significant supply rationalization over the past several years has improved market balance Benign Environment Floater Supply and Utilization Jackup Supply and Utilization 300 100% 550 100% 90% 500 90% 250 450 80% 80% 200 400 70% 70% 350 150 60% 60% 300 100 50% 250 50% 50 40% 200 40% Jan Jan Jan Jan
Slide 15: High levels of marketed utilization for drillships and jackups
High levels of marketed utilization for drillships and jackups 6/7G 6/7G Harsh Benign Delivered Rigs Drillships1 Benign Semis2 Jackups2 Jackups2 Time Stacked – Available And Cold Stacked Rigs Contracted 75 26 28 382 6/7G DRILLSHIPS1 6/7G BENIGN SEMIS1 1 Available3 10 7 3 28 3 2 5 3 5 6 Marketed Flee
Slide 16: Supply dynamics are supportive of a sustained upcycle
Supply dynamics are supportive of a sustained upcycle FLOATERS JACKUPS Benign environment floater supply has declined by 41% to 166 from a peak of Jackup supply has declined by 8% to 500 from a peak of 542 in early 2015 281 in late 2014 Available capacity is shrinking, with approximately 10 drillshi
Slide 17: Day rates have increased meaningfully over the past few years
Day rates have increased meaningfully over the past few years Day Rates for 6th & 7th Generation Drillship Fixtures1 Day Rates for Benign Environment Jackup Fixtures2 Day Rates for Harsh Environment Jackup Fixtures3 $600K $200K $200K $500K $150K $150K $400K $300K $100K $100K $200K $100K $50K v $50K
Slide 18: Valaris Earnings & Cash Flow Growth
Valaris Earnings & Cash Flow Growth 18
Slide 19: Significant earnings and cash flow growth expected over the next few years
Significant earnings and cash flow growth expected over the next few years Rigs Recontracting Impact of Recent Additional at Higher Day Rates Reactivations Operating Leverage v Five Valaris drillships currently on legacy day Six drillships reactivated since 2022 for work in key Three uncontracted st
Slide 20: Commercial execution driving increased backlog at higher day rates
Commercial execution driving increased backlog at higher day rates Strong contracting environment with improving contract backlog reaching $4.3 billion1,2 Historical Backlog ($ Billions) Pro Forma Annual Backlog Breakdown ($ Millions) 5.0 2,000 4.3 1,725 1,674 3.9 4.0 0.4 142 4.0 162 0.2 0.4 1,500 3
Slide 21: Earnings from floater fleet expected to increase as rigs reprice to market rates
Earnings from floater fleet expected to increase meaningfully as rigs reprice to market rates 2024 2025 2026 Rig Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Avg. Day Rate1 Contract Backlog1 DS-10 DS-4 Legacy Drillship Legacy Drillship DS-15 Contracts Contracts DS-9 $248,000 $192 Million DS-18 DS-12 DS-15 v v DS-1
Slide 22: Proven track record of winning contracts for drillships requiring reactivation
Proven track record of winning attractive contracts for drillships requiring reactivation Drillships – Average Contracted Utilization % By Quarter1 Major Peers2 Valaris 6 contracts won for stacked drillships since relisting in May 2021 100% From To 90% Contributed to drillship backlog increasing by
Slide 23: Additional operating leverage from three stacked 7th generation drillships
Additional operating leverage from three stacked Key Technical high-specification 7th generation drillships Specifications Strong pipeline of long-term programs provides attractive opportunities 7th Generation for VALARIS DS-11, DS-13 and DS-14 to be contracted Drillships ASSET TYPE Among the highes
Slide 24: Significant earnings potential and cash flow from Valaris fleet
Significant earnings potential and cash flow from Valaris fleet Total Rigs Under Contract or Illustrative Annual Earnings and Cash Flow from Valaris Fleet1 Rigs with Future Contract Illustrative Scenario A B C 13 10 Drillship Day Rates $400K $450K $500K 5 3 Benign Semisubmersible Day Rates $300K $35
Slide 25: Value-driven approach to capital allocation
Value-driven approach to capital allocation Pursue Accretive Investments Maintain a Strong in our Fleet and/or Strategic Return Free Cash Flow to Balance Sheet Growth Opportunities Shareholders v Intend to return all future free cash flow to Committed to maintaining a conservative Near-term investme
Slide 26: Valaris is well positioned to deliver meaningful value to shareholders
Valaris is well positioned to deliver meaningful value to shareholders Leading Strong Valaris Earnings Offshore Industry & Cash Flow Driller Fundamentals Growth Largest and highest specification fleet in Commodity supply and demand is highly Commercial execution driving increased the industry constr
Slide 27: Appendix
Appendix 27
Slide 28: Contract Backlog as of July 29, 2024
Contract Backlog as of July 29, 2024 Contract Backlog Contract Backlog by Customer Type 7% 41% 52% IOC NOC Independent (1) Contract backlog, contracted days and average day rates as of July 29, 2024. (2) Contract backlog and average day rates exclude certain types of non-recurring revenues such as l
Slide 29: Valaris owns 50% of joint venture with Saudi Aramco
Valaris owns 50% of joint venture with Saudi Aramco, the world’s largest jackup customer Image result for saudi aramco 50% $352M 50% $419M Ownership Shareholder Ownership Shareholder Notes Receivable Notes Receivable 9 20 Leased Jackups1 Newbuild Jackups • v Day rates set by an agreed pricing • Init
Slide 30: Non-GAAP Reconciliations
Non-GAAP Reconciliations (In millions) Year-Ended December 31, ARO 2023 Net income $ 2.5 Add (subtract): Income tax expense 8.3 Other expense, net 31.8 Operating income $ 42.6 Add (subtract): Depreciation expense 65.9 EBITDA $ 108.5 30
Slide 31: Focused Value Driven Responsible
FOCUSED VALUE DRIVEN RESPONSIBLE