After Seadrill, which hammered out a reorganization plan in July 2021 with its consenting lenders, emerged from Chapter 11 bankruptcy in February 2022, a little over a year after announcing its second bankruptcy filing in about four years, Odfjell Drilling made arrangements with SFL Corporation in May 2022 to take over marketing and management services for the Hercules rig from the Bermuda-based offshore drilling player.
SFL, which signed a contract with Galp Energia for the same semi-submersible in May 2023, filed a claim in March 2023 in the Oslo District Court regarding Seadrill’s redelivery of the semi-sub in December 2022, which allegedly was not done in the condition specified in the duo’s contract.
While the firm sought damages of around $28 million, the court issued a judgment in February 2025 in favor of SFL’s subsidiary, ordering Seadrill’s subsidiaries to pay the former an amount equivalent to approximately $48 million in compensation, which includes late payment interest and legal costs.
This legal saga got an epilogue at the Borgarting Court of Appeal, which has delivered its unanimous judgment in the legal case between SFL Corporation’s rig-owning subsidiary and certain subsidiaries of Seadrill, based on which the offshore drilling firm breached the contract when redelivering the rig.
As a result, the court ordered Seadrill to pay SFL’s subsidiary a total of approximately NOK 525 million (approximately $55 million), including compensation, late payment interest, and legal costs. The judgment largely upholds the Oslo District Court’s ruling from February 2025, but the total amount payable has increased as a result of accrued interest.
SFL has been awarded its full legal costs for the proceedings before both the Oslo District Court and Borgarting Court of Appeal. The company intends to review the judgment in detail, as either party may appeal to the Supreme Court of Norway within one month of service of the judgment.
An appeal can only be heard if leave to appeal is granted by the Supreme Court’s Appeals Selection Committee, which happens only in limited circumstances. The 2008-built Hercules sixth-generation deepwater and harsh environment rig of the GVA 7500 design can accommodate 180 people. With a maximum drilling depth of 35,000 feet, the semi-sub can operate in water depths of 10,000 feet.
