Seadrill Limited · NYSE:SDRL
Seadrill — Pareto Conference 2019
17 slides from Seadrill's conference presentation, Sep 11, 2019
Slide 1: Finding Value in an Improving Market
Finding Value in an Improving Market 11 September 2019
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: Seadrill: leaders in safety, young fleet, uptime
SEADRILL Leaders in safety… Better than IADC safety average over the last 5 years Young and modern fleet …as well as delivering strong operating uptime 96% 98% Seadrill fleet average age of 9 backlog with a We have drilled over 2500 wells in every major oil and Industry leading cost $1.9bn premium c
Slide 4: Our franchise: rigs, management & investments
Our franchise: rigs, management & investments Non-drilling Investments Group Rigs 19 floaters 8 floaters 5 jack-ups 4 floaters1 5 jack-ups2 5 floaters Well services, 6 PLSV’s 16 jack-ups 3 tenders land, and platform drilling Backlog3 $1.9 billion $697 million $1.0 billion - $656 million $345 million
Slide 5: Capital Structure and Liquidity
Capital Structure and Liquidity ▪ Cash of $1.5 billion ▪ No debt amortisation payments until 2020, with Debt Profile (Assuming utilization of ACE) the ability to defer up to 2021 using ACE 4,000 3,500 ▪ No debt maturities until June 2022 3,000 2,500 ▪ No financial covenants until 2021, other than 2,
Slide 6: The offshore barrel is well positioned
The offshore barrel is well positioned Offshore barrels critical to meet future demand Offshore break-evens competitive with Shale Total Liquids Supply and Demand Cumulative liquids supply cost curve Million Barrels of oil per day USD/Barrel Deepwater/ Ultra-Deepwater North American Shale • 10.7mmb/
Slide 7: The offshore barrel is well positioned
The offshore barrel is well positioned Offshore barrels critical to meet future demand Offshore break-evens competitive with Shale Total Liquids Supply and Demand Cumulative liquids supply cost curve North American Shale Million Barrels of oil per day USD/Barrel • 24 mmb/d production Deepwater/ Ultr
Slide 8: The recovery is progressing
The recovery is progressing Harsh Environment Floaters Benign Environment Floaters Premium BE Jack-ups1 Fixture Fixture Fixture Dayrate Dayrate Dayrate 350 (USDk) 350 (USDk) 120 (USDk) 300 300 100 250 250 80 200 200 60 150 150 40 100 100 20 50 50 - - - Jul-17 Feb-19 Mar-20 Jan-18 Aug-18 Sep-19 Jul-1
Slide 9: The recovery is progressing
The recovery is progressing Harsh Environment Floaters Benign Environment Floaters Premium BE Jack-ups1 Fixture Fixture Fixture Dayrate Dayrate Dayrate (USDk) (USDk) 350 350 (USDk) 120 300 300 100 250 250 80 200 200 60 150 150 40 100 100 20 50 50 - - - Jul-18 Mar-21 Feb-20 Jan-19 Aug-19 Sep-20 Jul-1
Slide 10: Deepwater pricing dynamics
Deepwater pricing dynamics Illustrative Reactivating cold- Current <$250k dayrates: stacked rigs >$300k2 168 20 29 94 25 No. of rigs1 Contracted Idle/ warm Cold stacked Newbuilds Total UDW 79% Marketed utilization Source: IHS Markit Rigpoint, Seadrill Analysis 10
Slide 11: Common themes: Discipline and contract terms
Common themes: Discipline and contract terms “No reactivations unless good return for “where there is a mobilization cost, then we stakeholders” are seeing mobilization fees “We have established a very high bar for reactivating getting paid” an asset at this point in time” “we will carefully evaluat
Slide 12: Delivering in an improving market
Delivering in an improving market $130m $85m $82m West Hercules West Saturn AOD I ▪ Equinor, Norway ▪ Equinor, Brazil ▪ Saudi Aramco ▪ 2 x contract award ▪ Option exercise ▪ 3 year extension $158m $25m $104m West Phoenix West Gemini West Castor ▪ Equinor, UK & Norway ▪ West Africa ▪ Staatsolie, Mexi
Slide 13: Creating value through Joint Ventures
Creating value through Joint Ventures ➢ Improved access to market ➢ High growth regions ➢ Strengthens customer relationships ➢ Day 1 cash flow and futureaadividend potential ➢ Limited upfront investment ➢ Potential for growing asset base ➢ $656 million in total contract value for GDI, option value o
Slide 14: Technology that will shape our industry
Technology that will shape our industry Condition-based Maintenance Hybrid Power ▪ Predicts failures before they happen ▪ 10-15% lower CO2, SOx and Nox ▪ Reduced overhaul interval results in ▪ 10-15% lower operating cost lowered maintenance spend ▪ 40% lower maintenance costs related ▪ Reduces out o
Slide 15: Our investment proposition
Our investment proposition Large and modern fleet Proven track record Capital, cost and contract discipline Leveraged play on the recovery 15
Slide 16: Q&A
Seadnill Q&A
Slide 17: Appendix
Appendix Our franchise: rigs, management & investments 1) Includes 2 Seadrill UDW drillships from Seadrill’s owned and managed fleet, and 2 UDW newbuild drillships from Sonangol 2) Includes 2 Seadrill jack-ups from Seadrill’s fleet, and 3 newbuild jack-ups from a third party shipyard 3) Backlog is a