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Seadrill's CEO Discusses Q2 2012 Results - Earnings Call Transcript

We have since our first-quarter report secured contracts and commitments totaling some $7.6 billion bringing our order backlog to a record high level of $20.3 billion. This reflects a very modern drilling fleet, strong operational track record, excellent customer relationship and the strong demand for offshore drilling services.

We’ve resolved to pay a cash dividend of $0.84 per share, up from $0.82 in the last quarter. This increase in dividend reflects our strong operational performance, our record high order backlog, the positive market outlook in the drilling industry and the strong support we received from the financing markets. Based on all the above, we are of the firm belief that the dividend level is sustainable in the long term.

Let me also share some brief comments on the performance of North Atlantic Drilling. North Atlantic delivered an excellent operational performance with an economic utilization of 99% resulting in the quarterly EBITDA of $156 million and earnings per share of $0.06.

The North Atlantic board resolved to maintain a quarterly cash dividend of $0.045 per share. North Atlantic continued to deliver strong operational performance and we’re very encouraged about the future market prospects in the harsh environment area. And we are still fully committed to our aim of listing the company in the U.S. during the end of 2012.

A bit about the global operational footprint. During the quarter and also in the third quarter, several jack-up rigs have been in transit to new locations. The West Triton and West Resolute have been relocated from Asia-Pacific to the Middle East. The West Triton commenced operation last week and we expect the West Resolute to start operation mid-September, both commencing a three-year contract with KJO.

The West Vigilant was in the second quarter in transit from Trinidad and Tobago to Vietnam where we expect the rig to start up on a new contract shortly. Furthermore the West Defender has moved from Brazil to Brunei and during the yard stay underway before commencing a four-year contract with Shell. We will receive a 5% day rate (ph) during the mobilization period which will be capitalized and amortized over the contract period.

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