Seadrill, the owner of offshore drilling rigs, has been ordered to pay approximately 525 million Norwegian kroner (about $55 million) to the subsidiary of SFL Corporation. This ruling was issued after Seadrill's failure to appeal the long-standing disputes regarding the status of the semi-submersible drilling rig Hercules at the time of its return to its owner.
Court Ruling and Financial Details
The Borgarting Court of Appeal in Norway unanimously stated that Seadrill breached its contract when returning the rig, previously known as West Hercules, to SFL, which is backed by John Fredriksen. The awarded amount includes damages, late interest, and legal fees. Additionally, this court has also covered SFL's full legal costs for proceedings before both the Court of Appeal and the Oslo District Court.
Read more: Japan Takes Steps to Diversify Oil Imports from Non-Hormuz Sources
This ruling primarily affirms the Oslo District Court's ruling in February 2025, which had ordered Seadrill to pay approximately $37 million plus about $11 million in interest and legal fees. Seadrill later appealed this ruling in March 2025.
History of Dispute and Consequences
The disputes date back to the end of a long-term lease agreement under which Seadrill operated the drilling rig for harsh environments. SFL has claimed that Hercules was not returned in the required condition under the lease agreement. Last year, Seadrill announced that it had provided a guarantee of 574 million kroner (approximately $60.5 million) to Norwegian enforcement authorities as collateral for the initial ruling while the appeal process continues.
Either party can appeal to the Supreme Court of Norway within one month of receiving the Court of Appeal's ruling. Any further appeals will first require permission from the Supreme Court's selection committee.
Since the return of the rig, SFL has placed it under the management of Odfjell Drilling. The rig is being prepared for a campaign off the coast of Canada. SFL signed a 400-day contract worth approximately $170 million in March, with work set to begin in the first quarter of 2027.
Read more: Seadrill Signs New Contracts in Indonesia and Malaysia
