This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

SDRL - Seadrill Secures Contracts For Multiple Jack-up Units In Mexico

Stocks in this article: SDRL

HAMILTON, Bermuda, Feb. 18, 2014 (GLOBE NEWSWIRE) -- We refer to Seadrill Limited's ("Seadrill") third quarter earnings report on November 25, 2013, which announced a Heads of Agreement between Pemex Exploracion y Produccion ("Pemex"), Mexico's national oil company and Seadrill. Seadrill is pleased to announce that the final drilling contracts for the jack-up drilling units West Oberon, West Intrepid, West Defender and West Courageous are now executed.

The fifth contract for the recently acquired jack-up drilling unit, Prospector 3, renamed West Titania, is being processed for approval by Pemex and finalization is expected to take place second quarter 2014.

Each contract is for a firm term of approximately 6 years and total revenue potential from the five contracts exceeds US$1.8 billion.

Additionally, Seadrill is pleased to announce the establishment of SeaMex Ltd. (SeaMex), a 50/50 Joint Venture with an investment fund controlled by Fintech Advisory Inc. ("Fintech"). Fintech is a private investment manager founded in 1989 that has a strong investment record and operation in Latin American countries. SeaMex has been formed for the purpose of owning and managing the jack-up drilling units working for Pemex as well as to develop and pursue further opportunities in Mexico and other Latin American countries. The gross proceeds for the sale of 50% of the five rigs to our partner is expected to be around US$488 million and will result in a gain recordable in the first half of 2014.

Per Wullf, Seadrill CEO commented, "This opportunity to expand our relationship with Pemex was partly developed on the back of Seadrill's successful operations with our ultra-deepwater semi-submersible West Pegasus in Mexico.

The long term nature of these contracts and the establishment of SeaMex, will create economies of scale in the region. Seadrill sees recent developments in Mexico such as new petroleum legislation, Pemex' expansion plans and recent large deepwater discoveries as supportive to the great opportunity to expand business within the country. By using the Joint Venture to build up a strong local independent organization with close proximity to our customer, strong focus on education, and a high degree of local content, we expect to be able to create an efficient, high quality, and more cost effective organization. Over time, this will position Seadrill better than a centrally driven organization in what we see as a very attractive market. At the same time, a strong focus on localization benefits the Mexican labor market, the Mexican society, and our clients."

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs