HAMILTON, Bermuda, Jan. 12, 2007 (PRIME NEWSWIRE) -- Seadrill and Ship Finance International Limited have agreed to a sale and leaseback arrangement where Seadrill sells the jack-up rig West Prospero (Seadrill 4) for a consideration of US$210 million and simultaneously leases the unit for a term of 15 years.
Seadrill has, under the arrangement, several options to repurchase the unit during the charter period. The first repurchase option will be after three years at $142 million and the last repurchase option is after 15 years at $60 million.
The aggregate lease payment for the first three years totals approximately US$120 million. For the subsequent four-year period, the aggregated lease payment totals approximately US$77 million. For the remaining eight-years of the lease period, the agreed aggregated lease payment is approximately US$109 million. In addition, Ship Finance will, after January 1, 2009, receive a four percent profit split element of the adjusted operating profit, given that the operating profit has reached certain threshold levels.
Seadrill will not record any gain from the sale of West Prospero in the accounts, as the jack-up will continue to be reported as a newbuild asset in the Company's balance sheet.
Seadrill Limited Hamilton, Bermuda January 12, 2007