SDLP - Seadrill Partners Receives Notice of Termination for the West Leo
London, United Kingdom, December 2, 2016 - Seadrill Partners ("SDLP" or "the Company") has received a notice of termination from Tullow Ghana Limited ("Tullow") for the West Leo drilling contract (the "Contract") dated December 1, 2016. Tullow have purported to terminate the Contract by reason of the alleged Force Majeure claim declared in early October 2016, which we have disputed. Further or alternatively, Tullow has alleged that the Contract has been discharged by frustration. We do not accept that the Contract can be terminated or discharged as alleged and our claim in the English High Court proceedings will be amended to reflect this.
Finally, Tullow has in the further alternative terminated the Contract for its convenience, should it not succeed in its argument that it is entitled to terminate the Contract for Force Majeure or Frustration. In the event of termination for convenience, Seadrill Partners is entitled to an early termination fee of 60% of the remaining contract backlog, subject to an upward or downward adjustment depending on the work secured for the West Leo over the remainder of the contract term, plus other direct costs incurred as a result of the early termination.
FORWARD LOOKING STATEMENTS
This news release includes forward looking statements. Such statements are generally not historical in nature, and specifically include statements about the Company's plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. In particular, statements regarding projected changes in the Company's cash distributions, the Company's anticipated growth strategies and its ability to re-contract its drilling rigs are considered forward looking statements. These statements are made based upon management's current plans, expectations, assumptions and beliefs concerning future events impacting the Company and therefore involve a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied in the forward looking statements, which speak only as of the date of this news release. Important factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to the performance of the drilling rigs in the Company's fleet; delay in payment or disputes with customers; fluctuations in the international price of oil; changes in governmental regulations that affect the Company or the operations of the Company's fleet; increased competition in the offshore drilling industry; hire rates and factors affecting supply and demand for drilling rigs; the financial condition of the Company's existing or future customers; and general economic, political and business conditions globally. Consequently, no forward looking statement can be guaranteed. When considering these forward looking statements, you should keep in mind the risks described from time to time in the Company's filings with the SEC, including its Annual Report on Form 20-F (File No. 001-35704).
The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, the Company cannot assess the impact of each such factor on its business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward looking statement.