Seadrill has signed a definitive agreement to sell its Qatar jack-up fleet, which consists of three rigs, to Gulf Drilling International (GDI) for $338m.

The sale includes the West Castor, West Telesto and West Tucana rigs, as well as Seadrill’s 50% stake in the joint venture that operates these rigs.

Seadrill plans to use the cash proceeds from this deal to bolster its balance sheet and liquidity position.

The completion of the sale is contingent upon the approval of the Qatar Financial Centre Authority and the shareholders of GDI’s parent company.

The transaction is set to close in the third quarter of 2024.

Furthermore, Seadrill has revealed plans to enhance shareholder value through an expanded share repurchase programme.

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Following the completion of its current buyback initiative, the company is authorised to repurchase up to an additional $500m of its common shares over two years.

Seadrill president and CEO Simon Johnson said: “Our divestiture of the Qatar Jack-Up Fleet and exit from the joint venture are consistent with our ongoing efforts to strengthen and simplify our business and will allow us to focus on Seadrill’s core business: operating deepwater rigs across the Golden Triangle and similarly advantaged geographies.

“We believe that our strengthened liquidity position upon completion of the jack-up sale, coupled with our conviction in the deepwater floater market outlook and Seadrill’s competitive positioning within it, supports the expansion of our share repurchase programme.”

Last year, Seadrill acquired UK-based Aquadrill to create an offshore drilling company with a modern and high specification fleet.

The deal was signed in December 2022. With the completion of the deal, Aquadrill became Seadrill’s wholly owned subsidiary.