Rig Owner Seadrill Partners File for Bankruptcy Protection in US
The London-based company is seeking to restructure more than $3 billion in debt as it struggles to find work for its offshore fleet.
Seadrill Partners, which owns drilling rigs used by offshore contractor Seadrill Ltd., announced on Tuesday that is seeking chapter 11 bankruptcy protection in a Texas court to restructure more than $3 billion in debt.
Seadrill Partners said it is entering into the court-supervised process with the approval of a group of key lenders. The filing comes after the London-based company skipped making its periodic swap payments to lenders last week.
“The company intends to use the bankruptcy process to ensure that all customer, vendor, and employee obligations are met without interruption and to complete a consensual restructuring of its debt,” read the statement from Seadrill Partners.
In the first half of 2020, Seadrill Partners reported that four out of five of its drillships were active. Two of the drillships were on contract with BP for day rates of $575,000. The remaining two working drillships fetched day rates of $188,000 for an undisclosed operator.
The remainder of the fleet—including four semisubmersibles and three tender rigs—was inactive as of Seadrill Partner’ last update.
In September, Seadrill Ltd. entered into forbearance agreements with its creditors, allowing it to suspend interest payments and restructure $7.3 billion in debt while avoiding bankruptcy protection.
The company was forced into bankruptcy in 2017 after suffering continued losses stemming from the 2014 oil price downturn. Seadrill Ltd. owns a 35% share of Seadrill Partners.