Seadrill again seeks bankruptcy protection in bid to survive

FILE PHOTO: The SEADRILL 3, the first of four oil rigs that Keppel FELS is building for the same customer, is seen in Singapore in this April 21, 2006. REUTERS/Luis Enrique Ascui

OSLO (Reuters) - Offshore drilling rig contractor Seadrill has filed for bankruptcy protection at a U.S. court, it said on Wednesday, the second time in four years the company has entered into so-called Chapter 11 restructuring.

The Oslo-listed group controlled by Norwegian-born billionaire John Fredriksen returned to court along with several subsidiaries after failing to win consent from bank lenders to postpone payments on $5.7 billion of debts.

Its total debts and liabilities stood at $7.3 billion at the end of the third quarter of 2020.

“This announcement marks the start of the court supervised process that will create a company that is financially sustainable for the long term,” Chief Executive Stuart Jackson said in a statement.

“We are working closely with our stakeholders to ensure we achieve an outcome that gives us the flexibility to weather the low points in our industry cycles, whilst positioning us well for market recovery,” he said.

The company is the latest in a series of offshore rig firms to seek court protection from creditors following spending cuts by the oil industry in wake of the COVID-19 pandemic.