Liabilities subject to compromise

Note 4 – Liabilities subject to compromise

Liabilities subject to compromise in the Consolidated Balance Sheets include pre-petition liabilities that may be affected by the plan of reorganization at the amounts expected to be allowed, even if they may be settled for lesser amounts. If there is uncertainty about whether a secured claim is under-secured, or will be impaired under the plan of reorganization, the entire amount of the claim is included in liabilities subject to compromise. Differences between liabilities we have estimated and the claims to be filed will be investigated and resolved in connection with the claims resolution process in the Chapter 11 Cases. Liabilities subject to compromise includes amounts the Bankruptcy Court allowed as claim amounts resulting from the Debtors’ rejection of various executory contracts, such as the rejection and termination of the newbuild contracts with Samsung and DSME. We will continue to evaluate these liabilities throughout the Chapter 11 Cases and adjust amounts as necessary. Such adjustments may be material.

The Consolidated Balance Sheets include amounts classified as liabilities subject to compromise that we believe the Bankruptcy Court will allow as claim amounts resulting from the Debtors’ rejection of various executory contracts and unexpired leases and defaults under the debt agreements.


(In $ millions)	June 30, 2018		December 31, 2017
Senior undersecured or impaired external debt		5,266		5,371
Unsecured bonds		2,334		2,334
Newbuild global settlement agreement		1,064		1,064
Derivatives previously recorded at fair value		249		249
Accounts payable and other liabilities		84		103
Accrued interest payable		49		50
Amount due to related party		4		20

Total liabilities subject to compromise		9,050		9,191

While operating as a Debtor-in-Possession under Chapter 11 of the Bankruptcy Code, the Debtor may sell, otherwise dispose of, or liquidate assets, or settle liabilities, subject to the approval of the Bankruptcy Court or otherwise as permitted in the ordinary course of business, in amounts other than those reflected in the Consolidated Financial Statements. Moreover, the implementation of a plan of reorganization could materially change the amounts and classifications of assets and liabilities in the historical Consolidated Financial Statements.

Segment information

6 Months Ended

Jun. 30, 2018

Segment Reporting [Abstract]

Segment information

Note 5 – Segment information

Operating segments

We provide drilling and related services to the offshore oil and gas industry. We have been organized into three operating segments:

1.

Floaters: Services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contracts relate to semi-submersible rigs and drillships for harsh and benign environments in mid-, deep- and ultra-deep waters;

2.

Jack-ups: Services encompassing drilling, completion and maintenance of offshore exploration and production wells. The drilling contracts relate to jack-up rigs for operations in harsh and benign environments; and

3.

Other: Operations including management services to third parties and related parties. Income and expenses from these management services are classified under this segment.

Segment results are evaluated on the basis of operating income, and the information given below is based on information used for internal management reporting.

Total operating revenue


(In $ millions)	Six Months Ended June 30,
	2018		2017
Floaters		482		744
Jack-ups		193		360
Other		37		42

Total operating revenue		712		1,146

Depreciation and amortization


(In $ millions)	Six Months Ended June 30,
	2018		2017
Floaters		298		301
Jack-ups		93		105

Total		391		406

Operating loss - Net loss


(In $ millions)	Six Months Ended June 30,
	2018			2017
Floaters		(446	)		95
Jack-ups		(167	)		(115	)
Other		—			3

Operating loss		(613	)		(17	)

Unallocated items:
Total financial items and other		14			(96	)
Income taxes		(36	)		12

Net loss		(635	)		(101	)

Drilling units and Newbuildings - Total assets


(In $ millions)	June 30, 2018		December 31, 2017
Floaters		9,411		9,956
Jack-ups		3,369		3,508

Total drilling units and newbuildings		12,780		13,464

Unallocated items:
Assets held for sale		—		126
Investments in associated companies		1,615		1,473
Marketable securities		121		124
Cash and restricted cash		1,218		1,359
Other assets		1,311		1,436

Total assets		17,045		17,982

Drilling units and Newbuildings - Capital expenditures


(In $ millions)	Six Months Ended June 30,
	2018		2017
Floaters		93		54
Jack-ups		24		12

Total		117		66

Geographic segment data

Revenues are attributed to geographical segments based on the country of operations for drilling activities, i.e. the country where the revenues are generated. The following information presents our revenues and fixed assets by geographic area:

Revenues


(In US$ millions)	Six Months Ended June 30,
	2018		2017
Brazil		188		197
Nigeria		105		110
Angola		100		249
Norway		82		115
Saudi Arabia		79		80
United States		30		187
Others ⁽¹⁾		128		208

Total		712		1,146

⁽¹⁾	Other countries represent countries in which we operate that individually had revenues representing less than 10% of total revenues earned for any of the periods presented.

Major Customers

We had the following customers with contract revenues greater than 10% in any of the periods presented:


(In US$ millions)	Six Months Ended June 30,
	2018			2017
Petroleo Brasileiro S.A (“Petrobras”)		27	%		17	%
Total S.A Group (“Total”)		20	%		22	%
Saudi Aramco		12	%		8	%
Exxon Mobil Corp (“Exxon”)		11	%		7	%
LLOG		5	%		18	%

Fixed assets – drilling units ⁽¹⁾


(In US$ millions)	As at June 30, 2018		As at December 31, 2017
Brazil		2,405		1,816
Norway		2,331		2,258
Malaysia		1,445		1,809
Spain		1,344		2,016
United States		1,239		1,266
Other ⁽²⁾		3,767		4,051

Total		12,531		13,216

⁽¹⁾

The fixed assets referred to in the table above exclude assets under construction. The countries in this table represent the location of the drilling unit at the end of the reporting period and are not necessarily indicative of the geographic distribution of the revenues or operating profits generated by the assets during the period. In most cases these locations are different to the country in which the Company that owns the drilling unit is registered.

⁽²⁾	“Other countries” represent countries in which we operate that individually had fixed assets representing less than 10% of total fixed assets for any of the periods presented.

Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2018

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

Note 6 – Revenue from Contracts with Customers

The activities that primarily drive the revenue earned from our drilling contracts include (i) providing a drilling rig and the crew and supplies necessary to operate the rig, (ii) mobilizing and demobilizing the rig to and from the drill site and (iii) performing rig preparation activities and/or modifications required for the contract. Consideration received for performing these activities may consist of dayrate drilling revenue, mobilization and demobilization revenue, contract preparation revenue and reimbursement revenue. We account for these integrated services provided within our drilling contracts as a single performance obligation satisfied over time and comprised of a series of distinct time increments in which we provide drilling services.

Consideration for activities that are not distinct within the context of our contracts and do not correspond to a distinct time increment within the contract term are allocated across the single performance obligation and recognized ratably as time elapses over the estimated term of the contract.

Consideration for activities that correspond to a distinct time increment within the contract term is recognized in the period when the services are performed. The total transaction price is determined for each individual contract by estimating both fixed and variable consideration expected to be earned over the term of the contract. See below for further discussion regarding the allocation of the transaction price to the remaining performance obligations.

The amount estimated for variable consideration may be constrained and is only included in the transaction price to the extent that it is probable that a significant reversal of previously recognized revenue will not occur throughout the term of the contract. When determining if variable consideration should be constrained, management considers whether there are factors outside of our control that could result in a significant reversal of revenue as well as the likelihood and magnitude of a potential reversal of revenue. These estimates are re-assessed each reporting period as required.

Dayrate Drilling Revenue. Our drilling contracts generally provide for payment on a dayrate basis, with higher rates for periods when the drilling unit is operating and lower rates or zero rates for periods when drilling operations are interrupted or restricted. The dayrate invoices billed to the customer are typically determined based on the varying rates applicable to the specific activities performed on an hourly basis. Such dayrate consideration is allocated to the distinct hourly increment it relates to within the contract term, and therefore, recognized in line with the contractual rate billed for the services provided for any given hour.

Mobilization Revenue. We may receive fees (on either a fixed lump-sum or variable dayrate basis) for the mobilization of our rigs. These activities are not considered to be distinct within the context of the contract and therefore, the associated revenue is allocated to the overall performance obligation and recognized ratably over the expected term of the related drilling contract. We record a contract liability for mobilization fees received, which is amortized ratably to contract drilling revenue as services are rendered over the initial term of the related drilling contract.

Demobilization Revenue. We may receive fees (on either a fixed lump-sum or variable dayrate basis) for the demobilization of our rigs. Demobilization revenue expected to be received upon contract completion is estimated as part of the overall transaction price at contract inception. In most of our contracts, there is uncertainty as to the likelihood and amount of expected demobilization revenue to be received. For example, the amount may vary dependent upon whether or not the rig has additional contracted work following the contract. Therefore, the estimate for such revenue may be constrained, as described above, depending on the facts and circumstances pertaining to the specific contract. We assess the likelihood of receiving such revenue based on past experience and knowledge of the market conditions

Revenues Related to Reimbursable Expenses. We generally receive reimbursements from our customers for the purchase of supplies, equipment, personnel services and other services provided at their request in accordance with a drilling contract or other agreement. Such reimbursable revenue is variable and subject to uncertainty, as the amounts received and timing thereof are highly dependent on factors outside of our influence. Accordingly, reimbursable revenue is fully constrained and not included in the total transaction price until the uncertainty is resolved, which typically occurs when the related costs are incurred on behalf of a customer. We are generally considered a principal in such transactions and record the associated revenue at the gross amount billed to the customer, as “Reimbursable revenues” in our unaudited Condensed Consolidated Statements of Operations.

Contract Balances

Accounts receivable are recognized when the right to consideration becomes unconditional based upon contractual billing schedules. Contract asset balances consist primarily demobilization revenues which have been recognized during the period but are contingent on future demobilization activities. Contract liabilities include payments received for mobilization as well as rig preparation and upgrade activities which are allocated to the overall performance obligation and recognized ratably over the initial term of the contract.

The following table provides information about receivables, contract assets and contract liabilities from our contracts with customers:


(In $ millions)	June 30, 2018			January 1, 2018
Accounts receivable, net		272			295
Current contract assets ⁽¹⁾		9			7
Current contract liabilities (deferred revenue) ⁽¹⁾		(25	)		(37	)
Non-current contract liabilities (deferred revenue) ⁽¹⁾		(7	)		(18	)

⁽¹⁾	Current contract asset and liability balances are included in “other current assets” and “other current liabilities,” respectively in our unaudited Consolidated Balance Sheet as of June 30, 2018.

Significant changes in the contract assets and the contract liabilities balances during the period are as follows:


(In $ millions)	Net Contract Balances
Contract assets at January 1, 2018		7
Contract liabilities at January 1, 2018		(55	)

Net contract liability at January 1, 2018		(48	)

Decrease due to amortization of revenue that was included in the beginning contract liability balance		25
Increase due to cash received, excluding amounts recognized as revenue		(9	)
Decrease due to recognized during the period but contingent on future performance		9

Net contract liability at June 30, 2018		(23	)

Contract assets at June 30, 2018		9
Contract liabilities at June 30, 2018		(32	)

Deferred Contract Costs

Certain direct and incremental costs incurred for upfront preparation, initial mobilization and modifications of contracted rigs represent costs of fulfilling a contract as they relate directly to a contract, enhance resources that will be used in satisfying our performance obligations in the future and are expected to be recovered. Such costs are deferred and amortized ratably to contract drilling expense as services are rendered over the initial term of the related drilling contract. Such deferred contract costs in the amount of $9 million and $2 million are reported in “other current assets” and “other non-current assets,” respectively, in our unaudited Consolidated Balance Sheet at June 30, 2018. During the six-month period ended June 30, 2018, the amount of amortization of such costs was $15 million. There was no impairment loss in relation to capitalized costs.

Costs incurred for the demobilization of rigs at contract completion are recognized as incurred during the demobilization process. Costs incurred for rig modifications or upgrades required for a contract, which are considered to be capital improvements, are capitalized as drilling and other property and equipment and depreciated over the estimated useful life of the improvement.

Transaction Price Allocated to Remaining Performance Obligations

The following table reflects revenue expected to be recognized in the future related to unsatisfied performance obligations as of June 30, 2018:


	For the Years Ending December 31,
(In $ millions)	2018⁽¹⁾			2019			Total
Deferred mobilization revenue		(11	)		(18	)		(29	)
Other deferred revenue		(2	)		(1	)		(3	)
Total		(13	)		(19	)		(32	)

⁽¹⁾

Represents the six-month period beginning July 1, 2018.

The revenue included above consists primarily of expected mobilization and upgrade revenue for both wholly and partially unsatisfied performance obligations as well as expected variable mobilization and upgrade revenue for partially unsatisfied performance obligations, which has been estimated for purposes of allocating across the entire corresponding performance obligations. The amounts are derived from the specific terms within drilling contracts that contain such provisions, and the expected timing for recognition of such revenue is based on the estimated start date and duration of each respective contract based on information known at June 30, 2018. The actual timing of recognition of such amounts may vary due to factors outside of our control.

We have applied the disclosure practical expedient in ASC 606-10-50-14A(b) and have not included estimated variable consideration related to wholly unsatisfied performance obligations or to distinct future time increments within our contracts, including dayrate revenue. The duration of our performance obligations varies by contract.

Impact of Topic 606 on Financial Statement Line Items

Our revenue recognition pattern under Topic 606 is similar to revenue recognition under the previous guidance, except for the recognition of demobilization revenue. Such revenue, which was recognized upon completion of a contract under the previous guidance, is now estimated at contract inception and recognized ratably as contract drilling revenue over the term of the contract, constraining the estimate at each reporting period, where the revenue is contingent of the rig demobilizing.

Adopting Topic 606 did not have a material effect on the Consolidated Statement of Operations, Consolidated Balance Sheet or Consolidated Statement of Cash Flow as of and for the six months ended June 30, 2018.

Reorganization items

6 Months Ended

Jun. 30, 2018

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Reorganization items

Note 7 – Reorganization items

Expenses and income directly associated with the Chapter 11 Cases are reported separately in the Consolidated Statement of Operations as “Reorganization items” as required by ASC 852, Reorganizations. Reorganization items also include adjustments to reflect the carrying value of liabilities subject to compromise at their estimated allowed claim amounts, as such adjustments are determined. The following table summarizes the components included within reorganization items:


(In $ millions)	Six Months Ended June 30, 2018
Advisory and professional fees		(115	)
Interest income on surplus cash invested		6

Total reorganization items		(109	)

We use this category to reflect the net expenses and gains and losses that are the result of the reorganization of the business. Advisory and professional fees included in the table above represent professional fees for post-petition Chapter 11 related expenses.

Loss on disposals and contingent consideration

6 Months Ended

Jun. 30, 2018

Loss on disposals and contingent consideration

Note 8 - Loss on disposals and contingent consideration


(In $ millions)	Six Months Ended June 30,
	2018		2017
Loss on disposals
Loss on disposal of West Triton to Shelf Drilling		—		(34	)
Loss on disposal of West Resolute to Shelf Drilling		—		(61	)
Loss on disposal of West Mischief to Shelf Drilling		—		(71	)

Total loss on disposals		—		(166	)

Contingent Consideration realized
West Polaris earn out realized		—		4
West Vela earn out realized		7		7

Total contingent consideration recognized		7		11

Disposal of West Triton, West Resolute and West Mischief

On April 29, 2017 we reached agreement with Shelf Drilling to sell the West Triton, West Resolute and West Mischief for total consideration of $225 million. The West Triton and West Resolute were delivered in the six months ended June 30, 2017, whilst the West Mischief was delivered in the third quarter of 2017 after it had concluded its drilling contract. The sale resulted in a loss on disposal of $166 million, which was recognized within “Loss on disposals” on the Consolidated Statement of Operations.

West Polaris contingent consideration

On June 19, 2015, we sold the entities that owned and operated the West Polaris (the “Polaris business”), to Seadrill Operating LP (“Seadrill Operating”), a consolidated subsidiary of Seadrill Partners LLC and 42% owned by Seadrill. The entities continue to be related parties subsequent to the sale.

In relation to the sale, we may be entitled to receive a contingent consideration from Seadrill Partners, consisting of (a) any day rates earned by Seadrill Partners in excess of $450,000 per day, adjusted for daily utilization, tax and agency commission for the remainder of the ExxonMobil contract, which completed in December 2017 and (b) 50% of any day rate earned above $450,000 per day, adjusted for daily utilization, tax and agency commission fee after December 2017 until 2025.

Our accounting policy is not to recognize contingent consideration before it is considered realizable and has therefore not recognized on disposal any amounts receivable relating to the elements of consideration which are contingent on future events. From the disposal date of the West Polaris on June 19, 2015 to June 30, 2018, we have recognized $53 million in contingent consideration, as it became realized, within “Contingent consideration realized” on the Consolidated Statement of Operations.

West Vela contingent consideration

On November 4, 2014, we sold the entities that own and operate the West Vela (the “Vela business”) to Seadrill Capricorn Holdings LLC, a consolidated subsidiary of Seadrill Partners and 49% owned by Seadrill. The entities continue to be related parties subsequent to the sale.

As part of the consideration of the sale, we may be entitled to receive a contingent amount of up to $40,000 per day for the remainder of the BP contract, depending on the actual amount of contract revenue received from BP.

Our accounting policy is not to recognize contingent consideration before it is considered realizable and has therefore not recognized on disposal any amounts receivable relating to the elements of consideration which are contingent on future events. From the disposal date of the West Vela on November 4, 2014 to June 30, 2018, we have recognized $45 million in contingent consideration, as it became realized, within “Contingent consideration realized” on the Consolidated Statement of Operations.

Taxation	6 Months Ended
Taxation	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Taxation	Note 9 – Taxation The income tax expense increased by $48 million for the six months ended June 30, 2018 with an expense of $36 million as compared to a benefit of $12 million for the six months ended June 30, 2017. The tax provision for the first six months of 2018 has been prepared based on the actual results for the period rather than using the estimated results for the entirety of 2018. This is on the basis that it is known that due to the emergence from bankruptcy protection in early July, the results for the rest of 2018 reflect a series of adjustments arising from fresh start accounting that are not reliably estimable. The income tax expense for the six months ended June 30, 2018 of $36 million includes an increase in uncertain tax positions of $8 million and an $18 million tax expense due to an adjustment in the income tax charge for a subsidiary related to prior years. The Company considers the effect of this prior period correction not to be material in the context of the overall results for the current or prior periods. In the first six months of 2017 there was a net benefit in the tax expense due to a reduction in uncertain tax positions which did not recur and also a benefit following the submission of a tax return in respect of a prior year. Companies in the group are subject to taxation in various jurisdictions. Tax authorities in certain jurisdictions examine the tax returns and some have issued assessments. Companies in the group are defending the tax positions in those jurisdictions. The Brazilian tax authorities have issued a series of assessments with respect to our returns for certain years up to 2012 for an aggregate amount equivalent to $161 million including interest and penalties. The relevant group companies are robustly contesting these assessments including filing relevant appeals. An adverse outcome on these proposed assessments could result in a material adverse impact on our consolidated statement of financial position, results of operations or cash flows. The Nigerian tax authorities have issued a series of claims and assessments both directly and lodged through the Chapter 11 process with respect to returns for subsidiaries for certain years up to 2016 for an aggregate amount equivalent to $171 million. The relevant group companies are robustly contesting these assessments including filing relevant appeals in Nigeria and it is also intended that one or more formal objections against these claims for distribution purposes will be filed in the US court. An adverse outcome on these proposed assessments could result in a material adverse impact on our consolidated statement of financial position, results of operations or cash flows.

Earnings per share

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

Earnings per share

Note 10 – Earnings per share

The computation of basic earnings per share (“EPS”) is based on the weighted average number of shares outstanding during the period. Diluted EPS includes the effect of the assumed conversion of potentially dilutive instruments.

The components of the numerator for the calculation of basic and diluted EPS are as follows:


(In $ millions)	Six Months Ended June 30,
	2018			2017
Net loss		(477	)		(78	)
Less: Allocation to participating securities		—			—

Net loss available to shareholders		(477	)		(78	)

Effect of dilution		—			—

Diluted net loss available to shareholders		(477	)		(78	)

The components of the denominator for the calculation of basic and diluted EPS are as follows:


(In millions)	Six Months Ended June 30,
	2018			2017
Basic earnings per share:
Weighted average number of common shares outstanding		504			504
Diluted earnings per share:
Weighted average number of common shares outstanding		504			504
Effect of dilutive share options ⁽¹⁾		—			—
Effect of dilutive convertible bonds		—			—

Weighted average number of common shares outstanding adjusted for the effects of dilution		504			504

Basic (loss)/income per share (US dollar)		(0.95	)		(0.16	)

Diluted (loss)/income per share (US dollar)		(0.95	)		(0.16	)

⁽¹⁾	Certain stock options have been excluded from the calculation of diluted EPS because their exercise price exceeded our average share price during the calculation period.

Interests in the existing Seadrill common shares were extinguished under the plan of reorganization contemplated by the RSA. The plan provided holders of Seadrill Common stock with 2% of new Seadrill equity, subject to dilution by the primary structuring fee and an employee incentive plan. The RSA contemplated certain releases and exculpations and implementation of a customary equity-based employee incentive plan at the effective date.

Cash and cash equivalents

6 Months Ended

Jun. 30, 2018

Cash and Cash Equivalents [Abstract]

Cash and cash equivalents

Note 11 – Cash and cash equivalents


(In $ millions)	June 30, 2018		December 31, 2017
Cash and cash equivalents		809		1,255
Restricted cash⁽¹⁾		409		104

Total		1,218		1,359

⁽¹⁾

Restricted cash consists of bank deposits which have been pledged as collateral for certain guarantees issued by a bank or minimum deposits which must be maintained in accordance with contractual arrangements. Restricted cash amounts with maturities longer than one year are classified as non-current assets.

Marketable securities

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Marketable securities

Note 12 – Marketable securities

Effective January 1, 2018, we adopted ASU 2016-01, which requires us to measure all marketable securities that do not result in consolidation and are not accounted for under the equity method at fair value and recognize any changes through the Consolidated Statement of Operations. We use quoted market prices to determine the fair value of our marketable securities, and categorize them as level 1 on the fair value hierarchy. As a result of this adoption, we reclassified $31 million of previously recognized fair value gains from accumulated other comprehensive income to retained earnings on January 1, 2018.

For fiscal periods beginning prior to January 1, 2018, marketable securities not accounted for under the equity method were classified as available-for-sale. Unrealized gains and losses on equity securities classified as available-for-sale were recognized in other comprehensive income. We reviewed our marketable securities at each reporting date to determine if impairment indicators were present.

The following tables summarize the carrying values of our ownership interests in Seadrill Partners’ common units and Archer ordinary units, which are held as marketable securities in the Consolidated Balance Sheet:


(In $ millions)	June 30, 2018		December 31, 2017
Seadrill Partners —Common units		91		96
Archer		30		28

Total marketable securities		121		124

After we adopted ASU 2016-01 on January 1, 2018, changes in the fair value of investments in marketable securities are recorded in net income. We classify such gains within the line item “Unrealized loss on marketable securities” within the Consolidated Statement of Operations. The unrealized loss for the six months ended June 30, 2018 was as follows:


(In $ millions)	Six Months Ended June 30,

	2018
Seadrill Partners—Common Units—unrealized loss on marketable securities		(5	)
Archer—unrealized gain on marketable securities		2

Total unrealized loss on marketable securities		(3	)

Before we adopted ASU 2016-01 on January 1, 2018, changes in fair value of investments in marketable securities were initially recorded in other comprehensive income and then reclassified to net income when realized. We classified such gains within the line item “Unrealized gains on marketable securities” within the Consolidated Statement of Comprehensive income. The unrealized gain for the six months ended June 30, 2017 was as follows:


(In $ millions)	Six Months Ended June 30,
	2017
Seadrill Partners—Common Units—unrealized loss on marketable securities		(21	)
Archer—unrealized gain on marketable securities		27

Total unrealized gain on marketable securities		6

Accounts receivable	6 Months Ended
Accounts receivable	Jun. 30, 2018
Receivables [Abstract]
Accounts receivable	Note 13 – Accounts receivable Accounts receivable are presented net of allowances for doubtful accounts. The allowance for doubtful accounts receivables at June 30, 2018 was $83 million (December 31, 2017: $35 million). We recognized $48 million of bad debt expense for the six months ended June 30, 2018 (nil in the six months ended June 30, 2017).

Investments, Debt and Equity Securities [Abstract]

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

+ References + Details

Investment in associated companies

6 Months Ended

Jun. 30, 2018

Investment in associated companies

Note 14 – Investment in associated companies

We have the following investments that are either recorded using the equity method or at cost less impairment for the periods presented in these Consolidated Financial Statements:


(In $ millions)	June 30, 2018		December 31, 2017
Seabras Sapura Participacoes		76		63
Seabras Sapura Holdco		334		290
Seadrill Partners—Total direct ownership interests		914		857
Seadrill Partners—Subordinated units		120		97
Seadrill Partners—Seadrill member interest and IDRs ⁽¹⁾		64		64
SeaMex Ltd		107		102

Total investment in associated companies		1,615		1,473

⁽¹⁾	The Seadrill Partners—Seadrill member interest and Incentive Distribution Rights (“IDRs”) are recorded at cost less impairment on the basis that they do not represent common stock interests and their fair value is not readily determinable.

Seadrill Partners

Equity method investments

We hold investments in both subordinated units of Seadrill Partners and direct ownership interests in controlled subsidiaries of Seadrill Partners, which are accounted for under the equity method. The fair value of these investments are not readily determinable, as they are not publicly traded. These investments were recognized at fair value on the deconsolidation of Seadrill Partners in January 2014 and therefore categorized at level three on the fair value hierarchy. Level three inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity.

As at December 31, 2017, the carrying value of the subordinated units was found to exceed the fair value by $82 million, and the carrying value of the direct ownership interests was found to exceed the fair value by $723 million. We have recognized this impairment of the investments within “Loss on impairment of investments” in the Consolidated Statement of Operations.

The fair value of these investments were derived using an income approach, which discounts future free cash flows (“DCF model”). The estimated future free cash flows associated with the investments are primarily based on expectations around applicable day rates, drilling unit utilization, operating costs, capital and long-term maintenance expenditures, applicable tax rates and industry conditions. The cash flows were estimated over the remaining useful economic lives of the underlying assets but no longer than 30 years in total, and discounted using an estimated market participant weighted average cost of capital appropriate to the investment in Seadrill Partners at December 31, 2017. This was 9.75%.

The DCF model derived an enterprise value of the investments, after which associated debt was subtracted to provide equity values. The implied valuation of Seadrill Partners derived from the DCF model was crosschecked against the market price of Seadrill Partners’ common units. Due to the significant influence we have on Seadrill Partners, there is in implied significant influence premium, which represents the additional value we would place over and above the market price of Seadrill Partners in order to maintain this significant influence. This is similar in thought to an implied control premium. We have evaluated the difference by reviewing the implied control premium as compared to other market transactions within the industry. We deem the implied control premium to be reasonable in the context of the data considered.

The assumptions used in the DCF model were derived from significant unobservable inputs (representative of Level 3 inputs for Fair Value Measurement) and are based on management’s judgments and assumptions available at the time of performing the impairment test.

For the six months ended June 30, 2018, no other than temporary impairment has been identified.

Investments recorded at cost less impairment

We also hold the Seadrill member interest, which is a 0% non-economic interest, and which holds the rights to 100% of the Incentive Distribution Rights “IDRs” of Seadrill Partners. The Seadrill member interest and the IDRs in Seadrill Partners are accounted for as cost-method investments on the basis that they do not represent common stock interests and their fair value is not readily determinable. The fair value of our interest in the Seadrill member and the attached IDRs at deconsolidation in January, 2014, was determined using a Monte Carlo simulation method (“Monte Carlo model”). The method takes into account the cash distribution waterfall, historical volatility, estimated dividend yield and share price of the common units as at the deconsolidation date.

For the six months ended June 30, 2018, no impairment has been identified.

SeaMex Limited

We hold a 50% ownership interest in Seamex, a joint venture agreement with an investment fund controlled by Fintech, for the purpose of owning and managing certain jack-up drilling units located in Mexico under contract with Pemex. The West Oberon, West Intrepid, West Defender, West Courageous and West Titania jack-up drilling rigs are included within the joint venture. Our investment in Seamex was recognized at fair value on the deconsolidation of Seamex in March 2015, and subsequently accounted for under the equity method.

The deteriorating market conditions in the oil and gas industry and supply and demand conditions in the offshore drilling sector in which SeaMex operates is considered to be an indicator of impairment. We have determined the length and severity of the deterioration of market conditions to be representative of an other than temporary impairment. As such we have measured and recognized an other than temporary impairment of the investment in SeaMex as at December 31, 2017 of $36 million. We have recognized this impairment of the investments within “Loss on impairment of investments” in the Consolidated Statement of Operations.

The fair value was derived using an income approach, which discounts future free cash flows (“DCF model”). The estimated future free cash flows associated with the investment were primarily based on expectations around applicable day rates, drilling unit utilization, operating costs, capital and long-term maintenance expenditures and applicable tax rates. The cash flows were estimated over the remaining useful economic lives of the underlying assets but no longer than 30 years in total, and discounted using an estimated market participant weighted average cost of capital appropriate to the investment in SeaMex at December 31, 2017. This was 10.25%. The DCF model derived an enterprise value of the investments, after which associated debt was subtracted to provide equity values.

The assumptions used in the DCF model were derived from unobservable inputs (level 3) and are based on management’s judgments and assumptions available at the time of performing the impairment test. The use of different assumptions, particularly with regard to the most sensitive assumptions concerning estimated future dayrates and utilization and the assumed market participant discount rate, would have a material impact on the impairment charge recognized and our Consolidated Statement of Operations. In addition, if actual events differ from management’s estimates, or to the extent that these estimates are adjusted in the future, our financial condition and results of operations could be affected in the period of any such change of estimate

For the six months ended June 30, 2018, no other than temporary impairment has been identified.

Property plant and equipment

6 Months Ended

Jun. 30, 2018

Newbuildings [Member]

Note 15 – Newbuildings


(In $ millions)	As at June 30, 2018		As at December 31, 2017
Total Newbuildings		249		248

Our remaining Newbuilding investments relate to the eight jack-ups with Dalian and the option to purchase the Sevan Developer. The Dalian contracts are all with limited liability subsidiaries of Seadrill Limited that do not have the benefit of a Seadrill Limited guarantee. We continue discussions with Dalian regarding taking delivery of these units.

Drilling Unit [Member]

Note 16 – Drilling units


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Cost		17,452			17,335
Accumulated depreciation		(4,507	)		(4,119	)
Impairment		(414	)		—

Net book value		12,531			13,216

The depreciation expense on drilling units was $388 million for the six months ended June 30, 2018, and $392 million for the six months ended June 30, 2017.

In addition, the depreciation expense on equipment was $3 million for the six months ended June 30, 2018, and $14 million for the six months ended June 30, 2017.

Impairment of long-lived assets

We review the carrying value of our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be appropriate. We first assess recoverability of the carrying value of the asset by estimating the undiscounted future net cash flows expected to result from the asset, including eventual disposal. If the undiscounted future net cash flows are less than the carrying value of the asset, we then compare the carrying value of the asset with its fair value to determine an impairment loss to be recognized during the period. The determination of expected undiscounted cash flow amounts requires significant estimates, judgments and assumptions, including future dayrates, contract probabilities, economic utilization, capital and operating expenditure, applicable tax rates and asset lives. We operate in a highly cyclical industry which can’t always be predicted with a high level of accuracy. Therefore, differences between previous judgments and estimates and actual results will occur. We reassess judgments and estimates in the period in which significant differences are observed and may conclude that a triggering event has occurred and perform a recoverability test.

The downturn in the offshore drilling market, which started in 2013, has continued into the period to June 30, 2018. During this time, we have observed contract dayrates have been below the levels assumed in our previous forecasts. We considered this to be an indicator of potential impairment and reassessed recoverability of our drilling units by evaluating their estimated undiscounted future net cash flows based on updated projections of future dayrates, contract probabilities, economic utilization, capital and operating expenditures, applicable tax rates and asset lives. We calculated that the estimated undiscounted future net cash flows for three of our rigs were lower than their carrying values. This was primarily driven by lower assumptions on future dayrates and future contract probabilities. As a result, we recorded an impairment charge to reduce the value of these rigs to their fair value. The impairment expense totaled $414 million and was classified within “Loss on impairment of long-lived assets” on the Consolidated Statement of Operations. We derived the fair value of the rigs using an income approach. The cash flows were estimated over the remaining useful economic lives of the assets and discounted using an estimated market participant weighted average cost of capital of 11.4%. To estimate these fair values, we were required to use various unobservable inputs including assumptions related to the future performance of our rigs as explained above. We based all estimates on information available at the time of performing the impairment test. These estimates represented Level 3 fair value measurements.

Debt

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Debt

Note 17 – Debt


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Credit facilities:
$2,000 facility (North Atlantic Drilling) ⁽¹⁾		880			897
$400 facility ⁽¹⁾		130			133
$440 facility ⁽¹⁾		60			62
$1,450 facility ⁽¹⁾		311			318
$360 facility (Asia Offshore Drilling)		210			210
$300 facility ⁽¹⁾		140			142
$1,750 facility (Sevan Drilling) ⁽¹⁾		835			856
$450 facility ⁽¹⁾		255			261
$1,500 facility ⁽¹⁾		1,095			1,112
$1,350 facility ⁽¹⁾		913			931
$950 facility ⁽¹⁾		549			558
$450 facility (2015) ⁽¹⁾		98			101

Total credit facilities		5,476			5,581

Loans contained within VIEs:
$375 facility		237			251
$390 facility		215			226
$475 facility		285			309

Total loans contained within VIEs		737			786

Unsecured bonds:
NOK1,800 bond ⁽²⁾		231			231
$1,000 bond ⁽²⁾		843			843
$500 bond ⁽²⁾		479			479
NOK1,500 bond (NADL) ⁽²⁾		182			182
$ 600 bond (NADL) ⁽²⁾		413			413
SEK 1,500 bond ⁽²⁾		186			186

Total unsecured bonds		2,334			2,334

Total debt principal		8,547			8,701
Less: Debt balance held as subject to compromise		(7,600	)		(7,705	)

Total debt not subject to compromise		947			996

Less: current portion of debt principal		(91	)		(511	)

Long-term portion of debt principal		856			485

⁽¹⁾	Denotes impaired secured credit facilities that were reclassified to “Liabilities subject to compromise” on September 12, 2017

⁽²⁾	Denotes unsecured bonds that were reclassified to “Liabilities subject to compromise” on September 12, 2017

The Debtors filing of Bankruptcy on the Petition Date constituted an event of default under our secured credit facilities and unsecured bond facilities and were reported as “Liabilities subject to compromise” on the Consolidated Balance Sheets at December 31, 2017 and June 30, 2018.

During bankruptcy proceedings we continue to make interest payments on the secured credit facilities. These are treated as adequate protection payments which are recognized as a reduction in the principal balance of secured credit facilities held within “Liabilities subject to compromise” in the Consolidated Balance Sheets. $185 million has been recognized as adequate protection payments from Petition Date to June 30, 2018. The Debtors have discontinued recording interest on unsecured bond facilities classified as liabilities subject to compromise from the Petition Date.

Details of the debt issuance costs netted against the non-impaired current and long-term debt for each of the periods presented are shown below.


Outstanding debt as at June 30, 2018
(In $ millions)	Principal outstanding		Less: Debt Issuance Costs			Total Debt
Debt due within one year		91		(1	)		90
Long-term debt		856		—			856
Debt held as subject to compromise		7,600		—			7,600

Total		8,547		(1	)		8,546


Outstanding debt as at December 31, 2017
(In $ millions)	Principal outstanding		Less: Debt Issuance Costs			Total Debt
Debt due within one year		511		(2	)		509
Long-term debt		485		—			485
Debt held as subject to compromise		7,705		—			7,705

Total		8,701		(2	)		8,699

The outstanding debt as at June 30, 2018 is repayable as follows:


(In $ millions)	Year ended June 30,
2019		91
2020		57
2021		68
2022		70
2023		523
2024 and thereafter		138

Total debt principal		947

The significant developments relating to our debt in the six months ended June 30, 2018 are explained below.

New Secured Notes on emergence

On July 2, 2018, we raised $880 million of aggregate principle amount of 12.00% senior secured notes due in 2025. The notes bear interest at the annual rate of 4.00% payable in cash plus at the annual rate of 8.00% payable in kind. Under certain circumstances, we may elect to pay the amount of payment in kind interest payable on any interest payment date in cash at an annual rate of 8.00%. Interest will be payable semi-annually in arrears. We have cross-guaranteed the notes on a pari passu basis with our lenders under the senior credit facilities and all other unsecured creditors and is a first ranking guarantee by substantially all of the Company and on a second priority basis by the common collateral.

$360 million senior secured credit facility

In April 2013, our majority owned subsidiary AOD entered into a $360 million senior secured credit facility with a syndicate of banks. The loan had a five year maturity from the initial borrowing date, and bears interest of LIBOR plus 2.75%. In the period ended June 30, 2018, following the Plan of Reorganization, the senior secured credit facility was reclassified to long-term to reflect the maturity extension contemplated.

Ship Finance International Limited (“Ship Finance”) Loans

Ship Finance International Limited loans comprise of three facilities: SFL Hercules Ltd of $375 million entered into in May 2013, SFL Deepwater Ltd of $390 million and SFL Linus Ltd of $475 million both entered into in October 2013. These facilities were taken out with a syndicate of banks and financial institutions. In the period ended June 30, 2018 $200 million of short-term debt of SFL was reclassified to long-term as a result of amending the third-party credit facilities of SFL to conform with the charter payment schedules included as part of the RSA.

Covenants contained in our debt facilities

Credit facilities

The financial covenants contained in our credit facilities post emergence are measured at the RigCo group level. Details of the levels which are required to be maintained under the credit facilities are as follows:

•

Aggregated minimum liquidity requirement for the Group: In summary, and as more particularly set out in the credit facilities, to maintain cash and cash equivalents of at least $525 million within the Group at any time during the period from and including the Effective Date to and including 31 December 2018; and $400 million at any time during the period from and including 1 January 2019 to the final maturity date of the credit facilities;

•

Net leverage ratio: to maintain a ratio of net debt to EBITDA as set out below (which will be tested on each financial quarter commencing with the financial quarter ending on 31 March 2022 until the final maturity date of the credit facilities):

1.

for the twelve months ending 31 March 2022, be equal to or less than 4.5x;

2.

for the twelve months ending 30 June 2022, be equal to or less than 4.2x;

3.

for the twelve months ending 30 September 2022, be equal to or less than 3.9x; and

4.

for the twelve months ending 31 December 2022, be equal to or less than 3.7x.

•

Debt service coverage ratio: in summary to maintain a ratio of EBIDTA to debt services (being all finance charges and principal, as more particularly set out in the credit facilities) equal to or greater than 1:1 (which will be tested on each financial quarter commencing with the financial quarter ending on 31 March 2022 until the final maturity date of the credit facilities).

New Secured Notes

The covenants included in the New Secured Notes agreements entered into on July 2, 2018, limit our restricted subsidiaries and our ability to:

•

pay dividends or make certain other restricted payments or investments;

•

incur additional indebtedness and issue disqualified shares;

•

create liens on assets;

•

amalgamate, merge, consolidate or sell substantially all of our, NSNCo’s, IHCo’s, RigCo’s and their respective subsidiaries and the guarantors’ assets;

•

enter into certain transactions with affiliates;

•

create restrictions on dividends and other payments by our restricted subsidiaries; and

•

guarantee indebtedness by our restricted subsidiaries. The above covenants are subject to important exceptions and qualifications.

Following emergence from Chapter 11 on the Effective Date, with exception of minimum liquidity requirements, we are exempt from financial covenants until 1Q 2021. Thereafter, in addition to minimum liquidity requirements the Group is required to maintain and satisfy certain financial ratios and covenants, relating to net leverage and debt service coverage.

Total gain/loss on debt extinguishment

During the period ended June 30, 2017, we agreed with Archer to convert total outstanding subordinated loans, fees and interest provided to Archer, with a carrying value of $37 million, into a $45 million loan. The fair value of the new loan receivable at the date of conversion was $56 million resulting in a gain of $19 million on debt extinguishment, which is presented within “Net gain/(loss) on debt extinguishment” in our Consolidated Statement of Operations.

Common shares

6 Months Ended

Jun. 30, 2018

Temporary Equity Disclosure [Abstract]

Common shares

Note 18 – Common shares


	As at June 30, 2018						As at December 31, 2017
	Shares			$ million			Shares			$ million
All shares are common shares of $2.00 par value each
Authorized share capital		800,000,000			1,600			800,000,000			1,600
Issued and fully paid share capital		508,763,020			1,017			508,763,020			1,017
Treasury shares held by the Company		(4,244,080	)		(9	)		(4,244,080	)		(9	)

Outstanding common shares in issue		504,518,940			1,008			504,518,940			1,008

As at June 30, 2018, our shares were listed on the Oslo Stock Exchange and the New York Stock Exchange.

We were incorporated on May 10, 2005 and 6,000 ordinary shares of par value $2.00 each were issued. Since incorporation the number of issued shares has increased from 6,000 to 508,763,020 of par value $2.00 each as at June 30, 2018.

A share repurchase program was approved by the Board in 2007 giving us the authorization to buy back shares. Shares bought back under the authorization may be cancelled or held as treasury shares. Treasury shares may be held to meet our obligations relating to the share option plans. As at June 30, 2018 we held 4,244,080 treasury shares (December 31, 2017, 4,244,080).

As of the Chapter 11 Filing Date, September 12, 2017, we had 504,518,940 common shares outstanding. We recorded our common shares at carrying value until July 2, 2018 when the plan was confirmed by the Bankruptcy Court, at which point these shares were cancelled and 100,000,000 new common shares were issued in accordance with the Investment Agreement as discussed in Note 3 – Chapter 11 Proceedings. In addition, due to the Bankruptcy Filing, no dividends are eligible to be paid without the approval of the Bankruptcy Court.

Non-controlling interest

6 Months Ended

Jun. 30, 2018

Noncontrolling Interest [Abstract]

Non-controlling interest

Note 19 – Non-controlling interest

Changes in non-controlling interest for the period ended June 30, 2018 is as follows:


(In $ millions)	Ship Finance International Ltd VIEs			North Atlantic Drilling Ltd			Asia Offshore Drilling Ltd			Sevan Drilling ASA			Seadrill Nigeria Operations Limited		Total
December 31, 2017		(59	)		76			149			226			7		399
Adoption of new accounting standard ASU 2016-16 - Income Taxes⁽¹⁾		—			(25	)		—			—			—		(25	)
Net income attributable to non-controlling interest in 2018		7			(160	)		1			(10	)		2		(160	)
Redeemable non-controlling interest⁽²⁾		—			—			(150	)		—			—		(150	)

Ending balance, June 30, 2018		(52	)		(109	)		—			216			9		64

⁽¹⁾	For further information see Note 2 “Recent accounting pronouncements”

⁽²⁾	For further information see Note 20 “Redeemable non-controlling interest”

Redeemable non-controlling interest

6 Months Ended

Jun. 30, 2018

Redeemable non-controlling interest

Note 20 – Redeemable non-controlling interest

Changes in redeemable non-controlling interest for the period ended June 30, 2018 is as follows:


(In $ millions)	Asia Offshore Drilling Ltd
As at December 31, 2017		—
Reclassification from non-controlling interest		150
Fair value adjustment on initial recognition		(127	)
Net income attributable to redeemable non-controlling interest in 2018		2

As at June 30, 2018		25

Subsequent to filing bankruptcy petitions, Seadrill executed a Transaction Support Agreement (“TSA”) on April 4, 2018 with a minority shareholder of one of Seadrill’s subsidiaries, Asia Offshore Drilling Limited (“AOD”). The purpose of the TSA was to provide a framework for a monetization event for the minority shareholder of AOD as well as obtain unanimous approval of the AOD board of directors (which included the minority shareholder) in order for AOD to become a party to the RSA and participate in Seadrill’s broader debt restructuring under its Chapter 11 reorganization.

The TSA executed between the parties provided a put option to the holders of non-controlling interest shares. The put option gave the holders the right (with no obligation) to sell the shares it owns to Seadrill subject to a price ceiling. After the end of the effective period of the put option, if the right remains unexercised, Seadrill gets the right (with no obligation) to purchase the non-controlling interest in AOD at a price subject to the floor price (“Call Option”). While the call option provides for a redemption mechanism, the redemption option is made by Seadrill. The put option, however, generates a redemption feature for the non-controlling interest holder that is outside the control of Seadrill.

This redemption feature caused the fair value of the non-controlling interest held in AOD to be reclassified from equity to “Redeemable non-controlling interest” within the Consolidated Balance Sheets. Any fair value adjustments to generate an expected redemption value have been recognized through retained earnings.

We reclassified $150 million of non-controlling interest from equity to redeemable non-controlling interest on the date of the TSA (April 4, 2018) and recorded a fair value adjustment of $127 million on initial recognition. We attributed $2 million of net income to the redeemable non-controlling interest covering the period April 2018 to June 2018, resulting in the redeemable non-controlling interest having a fair value on June 30, 2018 of $25 million. The fair value adjustment on initial recognition and subsequent changes in fair value are recognised in retained earnings.

To calculate the fair value of the non-controlling interest, we have taken the Consolidated Balance Sheet position of AOD as at June 30, 2018 and adjusted for an updated fair value of the three drilling units: AOD I, AOD II and AOD III. The fair value of the drilling units were derived using a market approach.

Accumulated other comprehensive income

6 Months Ended

Jun. 30, 2018

Accumulated other comprehensive income

Note 21 – Accumulated other comprehensive income

Accumulated other comprehensive income as at June 30, 2018 and December 31, 2017 was as follows:


(In $ millions)	Unrealized gain on marketable securities			Unrealized gain on foreign exchange		Actuarial (loss) / gain relating to pension			Share in unrealized gain from associated companies		Change in unrealized gain on interest rate swaps in VIEs		Change in conversion option on Archer debt facility		Total
Beginning balance, December 31, 2017		31			36		(26	)		15		2		—		58
Adoption of accounting standard update		(31	)		—		—			—		—		—		(31	)
Beginning balance, January 1, 2018		—			36		(26	)		15		2		—		27
Other comprehensive income before reclassifications		—			—		1			11		—		2		14

Ending balance, June 30, 2018		—			36		(25	)		26		2		2		41

In January 2016, the FASB issued ASU 2016-01 “Recognition and Measurement of Financial Assets and Financial Liabilities” to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information. ASU 2016-01 became effective for fiscal years and interim periods beginning after December 15, 2017. We adopted ASU 2016-01 starting from January 1, 2018 on a modified retrospective basis, with no changes recognized in the prior year comparatives and a cumulative catch up adjustment recognized in the opening retained earnings.

Upon adoption of ASU 2016-01, we reclassified $31 million of unrealized gains related to our marketable securities from accumulated other comprehensive income to retained earnings. As a result of the adoption of this guidance we are required to recognize the movement in the fair value of our marketable securities in the Consolidated Statement of Operations. Refer to Note 12 “Marketable securities” for further information.

With the exception of the actuarial gain relating to pension, income taxes associated with each component of other comprehensive income is nil. The income tax benefit on actuarial gain relating to pension is $0.4 million as at June 30, 2018 and $0.6 million as at December 31, 2017.

Risk management and financial instruments

6 Months Ended

Jun. 30, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Risk management and financial instruments

Note 22 – Risk management and financial instruments

The majority of gross earnings from our drilling units are receivable in U.S. dollars and the majority of our other transactions, assets and liabilities are denominated in U.S. dollars, our functional currency. However, we have operations and assets in a number of countries worldwide and incur expenditures in other currencies, causing our results from operations to be affected by fluctuations in currency exchange rates, primarily relative to the U.S. dollar. Historically, we have been exposed to changes in interest rates on floating interest debt, and to the impact of changes in currency rates on NOK and SEK denominated debt. Due to the filing of the Bankruptcy Petitions, interest is no longer incurred on our unsecured bonds and they are held at the foreign exchange rate as at the Petition Date. Interest continues to be incurred on the floating interest debt but is recognized as an adequate protection payment for those facilities held as subject to compromise. Interest on floating rate debt not held as subject to compromise continues to be paid and recognized in the Consolidated Statement of Operations. There is thus a risk that interest rate fluctuations will have a positive or negative effect on the value of our cash flows.

Prior to filing for Chapter 11, we entered into derivative agreements to mitigate the risk of currency and interest rate fluctuations. However, filing for Chapter 11 triggered an event of default under each of our International Swaps and Derivatives Agreements (ISDA). As a result, our counterparties terminated all outstanding transactions governed by the ISDA, effective September 13, 2017. The derivative transactions are recognized at the recoverable amount under the ISDA’s as agreed with our lenders. As of December 31, 2017 and June 30, 2018 we had $249 million in estimated derivative instrument settlements payable, reflected in the liabilities subject to compromise on the Consolidated Balance Sheet. Refer to Note 4 “Liabilities subject to compromise” for further information.

Interest rate risk management

Our exposure to interest rate risk relates mainly to our floating interest rate debt and balances of surplus funds placed with financial institutions. The exposure related to our floating interest debt has reduced since filing for Chapter 11, as noted above. We have historically managed this risk through the use of interest rate swaps and other derivative arrangements and continue to do so for some of our facilities which are not subject to compromise. Our objective is to obtain the most favorable interest rate borrowings available without increasing our foreign currency exposure. The extent to which we utilized interest rate swaps and other derivatives to manage our interest rate risk has been determined by the net debt exposure.

Interest rate swap agreements not qualified for hedge accounting

At the date of filing for Chapter 11, we had interest rate swap agreements with maturity dates between November 2, 2017 and January 29, 2027, which swapped the floating element of interest on our facilities for fixed rates ranging between 0.74% and 3.34%. In addition, we had an interest rate swap contract principal, which was entered into in February 2014 with a forward start in March 2016, under which it pays a floating rate of LIBOR and receive a fixed rate of 2.12%. These agreements did not qualify for hedge accounting, and accordingly any changes in the fair values of the swap agreements are included in the Consolidated Statement of Operations under “Gain/(loss) on derivative financial instruments”. We recognized total realized and unrealized losses of $18 million for the six months to June 30, 2017. No gains or losses were made in the six months to June 30, 2018 following the termination of interest rate swaps under the ISDA.

Cross currency interest rate swaps not qualified as hedge accounting

At the date of filing for Chapter 11, we had outstanding cross currency interest rate swaps with maturity dates between March 2018 and March 2019 at fixed rates ranging from 4.94% to 6.18%. These agreements did not qualify for hedge accounting and accordingly any changes in the fair values of the swap agreements were included in the Consolidated Statement of Operations under “Gain/(loss) on derivative financial instruments”. We recognized total realized and unrealized gains of $29 million for the six months to June 30, 2017. No gains or losses were made in the six months to June 30, 2018 following the termination of the cross-currency interest rate swaps under the ISDA.

Interest rate swaps agreements qualified for hedge accounting

A Ship Finance subsidiary consolidated by Seadrill as a Variable Interest Entity (“VIE”) (refer to Note 23 “Variable Interest Entities”) has entered into interest rate swaps in order to mitigate its exposure to variability in cash flows for future interest payments on the loans taken out to finance the acquisition of the West Linus. These interest rate swaps qualify for hedge accounting and any changes in fair value are initially recorded within Other Comprehensive Income and then reclassified to the Consolidated Statement of Operations on settlement of the swap.

Below is a summary of the notional amount, fixed interest rate payable and duration of the outstanding principal as at June 30, 2018.

Variable interest entity

Outstanding principal as at
June 30, 2018
(In $ millions)

Receive rate

Pay rates

Length of contracts

SFL Linus Limited

(West Linus)

141

1—3 month LIBOR

1.77—2.01

%

Dec 2013—Dec 2018

The total fair value of interest swaps under hedge accounting at June 30, 2018 amounted to an asset of $0.4 million (December 31, 2017: liability of $1 million), classified as “Other current assets” in the Consolidated Balance Sheet.

In the six months ended June 30, 2018, the VIE Ship Finance subsidiary recorded $0.3 million fair value gains (six months ended June 30, 2017: $1 million fair value gains). Any such gains or losses recorded by the VIE in OCI are allocated to non-controlling interests due to their ownership by Ship Finance.

Any change in fair value resulting from hedge ineffectiveness is recognized immediately in earnings. The VIE, and therefore the Company, recognized no gain or loss due to hedge ineffectiveness in the consolidated financial statements during the six months ended June 30, 2018 (six months ended June 30, 2017: no fair value gain or loss). The net cash settlements on these swaps for the six months ended June 30, 2018 was $0.1 million (six months ended June 30, 2017: $0.6 million).

Interest Rate Cap

On May 11, 2018, we purchased an interest rate cap for $68 million to mitigate our exposure to future increases in LIBOR on our floating rate debt. The capped rate against the 3-month US LIBOR is 2.87% and covers the period from June 15, 2018 to June 15, 2023. The principal amount covered by the cap as at June 30, 2018 is $4.5 billion. As at June 30, 2018, the fair value of the interest rate cap was $61 million.

We did not designate the interest rate cap for hedge accounting and accordingly changes in the fair value of the interest rate cap are recorded in net income. We classified the unrealized loss in the period to June 30, 2018 of $7 million under the line item “(Loss) / gain on derivative financial instruments” in the Consolidated Statement of Operations.

Foreign exchange risk management

Seadrill and the majority of our subsidiaries use the U.S. dollar as the functional currency because the majority of the revenues and expenses are denominated in U.S. dollars. Accordingly, our reporting currency is also U.S. dollars. We do, however, earn revenue and incur expenses in other currencies and there is thus a risk that currency fluctuations could have an adverse effect on the value of our cash flows. Prior to entering Chapter 11 we were exposed to the impact of changes in currency exchange rates on NOK and SEK denominated debt. Prior to September 13, 2017, we had entered into derivative agreements to mitigate the risk of exchange rate fluctuations.

Foreign currency forwards not qualified for hedge accounting

As at June 30, 2018 and 2017 we had no outstanding forward currency agreements.

Other derivative agreements

Archer convertible debt instrument

On April 26, 2017 we agreed with Archer to convert total outstanding subordinated loans provided to Archer, inclusive of associated fees and interest, with a carrying value of $37 million, into a $45 million loan. The new loan receivable is a convertible debt instrument comprised of a debt instrument and a conversion option, classed as an embedded derivative. Both elements are required to be measured at fair value at each reporting date. The fair value of the new loan receivable as at inception, April 26, 2017, was $56 million, resulting in a $19 million gain on the extinguishment of the original subordinated debt in the statement of operations.

At at June 30, 2018 the fair value of the convertible debt instrument was $58 million of which the split between debt and embedded derivative option was $46 million and $12 million respectively. The debt and embedded derivative option was revalued at the period end and we have recognized a fair value gain on the debt component of $2 million and a fair value gain on the embedded conversion option of $4 million for the six months ending June 30, 2018.

Realized and unrealized gains and losses

The total realized and unrealized gains and losses recognized in the Consolidated Statement of Operations relating to above derivative arrangements for the six months ended June 30, 2018 and 2017 are as follows:


(In $ millions)	Six Months Ended June 30,
*(Losses)/Gains recognized in the consolidated statement of operations relating to derivative financial instruments*		2018		2017
Interest rate swap agreements not qualified as hedge accounting		(1	)	(18	)
Cross currency interest rate swaps not qualified as hedge accounting		—		29
Foreign currency spot trades not qualified as hedge accounting		—		1
Convertible loan agreement		4		(5	)
Interest rate cap		(7	)	—

(Loss)/Gain on derivative financial instruments		(4	)	7

Fair values of financial instruments

The carrying value and estimated fair value of our financial instruments as at June 30, 2018 and December 31, 2017 were as follows

Financial assets


	As at June 30, 2018				As at December 31, 2017
(In $ millions)	Fair value		Carrying value		Fair value		Carrying value
Cash and cash equivalents		809		809		1,255		1,255
Restricted cash		409		409		104		104
Derivative Asset—interest rate cap		61		61		—		—
Related party loans receivable—short term		18		18		25		25
Related party loans receivable—long term		547		535		522		515

Financial liabilities

As at June 30, 2018, we had outstanding floating rate interest bearing debt with carrying value of $6.2 billion (December 31, 2017: $6.4 billion), of which $5.3 billion (December 31, 2017: $5.4 billion) was held as subject to compromise. As a result of filing for Chapter 11, the fair value of our floating rate interest bearing debt cannot be reasonably determined.

As at June 30, 2018 and December 31, 2017, we had outstanding fixed and floating interest bonds with carrying value of $1.7 billion and $0.6 billion respectively. These were held as a liability subject to compromise on the Consolidated Balance Sheet. As a result of filing for Chapter 11, the fair value of our floating or fixed rate interest bonds cannot be reasonably determined.

As at June 30, 2018 we had outstanding related party fixed rate debt with carrying value of $314 million and fair value of $219 million (December 31, 2017: carrying value of $314 million and fair value of $218 million).

As at June 30, 2018, and December 31, 2017 we had $39 million of interest rate swaps and $210 million of cross currency interest rate swaps classified as liabilities subject to compromise. The balance reflects the terminated value claimed by the counterparty as at September 13, 2017. As a result, the carrying and fair value of the financial instrument as at June 30, 2018 and December 31, 2017 would be $249 million.

Fair value considerations

US GAAP emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, US GAAP establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within level 3 of the hierarchy).

Level 1 input utilizes unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Level 2 inputs are inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability, other than quoted prices, such as interest rates, foreign exchange rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.

The carrying value of cash and cash equivalents and restricted cash, which are liquid, is a reasonable estimate of fair value and categorized at level 1 on the fair value measurement hierarchy.

The fair value of the related party loans receivable from Seadrill Partners, SeaMex and Seabras Sapura are estimated to be equal to the carrying value. This debt is not freely tradable and cannot be recalled by us at prices other than specified in the loan note agreements. The loans were entered into at market rates. They are categorized as level 2 on the fair value measurement hierarchy. Other trading balances with related parties are not shown in the table above and are covered under Note 24-“Related party transactions”. The fair value of other trading balances with related parties are also assumed to be equal to their carrying value.

The related party convertible loan receivable from Archer has been fair valued for the debt and conversion option components. We have categorized this at level 3 on the fair value measurement hierarchy.

The fair value of the loans provided by Ship Finance to our VIE’s are derived using the Discounted Cash Flow (DCF) model. The cost of debt of 11% was used to estimate the present value of the future cash flows. We have categorized this at level 2 on the fair value measurement hierarchy. Refer to Note 24 “Related party transactions” for further information.

To calculate the fair value of the AOD redeemable non-controlling interest shares, we first estimated the fair value of AOD in total and then allocated this between the shares held by us and by those held by the non-controlling interest. We estimated the fair values of AOD in total by adjusting the Consolidated Balance Sheet position of AOD as at June 30, 2018 for an updated fair value of the three drilling units: AOD I, AOD II and AOD III. We derived the fair value of the three drilling units using a market approach. We have categorized this at level 3 on the fair value measurement hierarchy. Refer to Note 20 – Redeemable non-controlling interest for further information.

Financial assets that are measured at fair value on a recurring basis:


			Fair value measurements as at the reporting date using
(In $ millions)	Total fair value As at June 30, 2018		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Marketable securities - current asset		121		121		—		—
Interest rate cap – current asset		61		—		61		—
Convertible debt instruments - non-current asset		58		—		—		58

Total assets		240		121		61		58


			Fair value measurements as at the reporting date using
(In $ millions)	Total fair value As at December 31, 2017		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Marketable securities - current asset		124		124		—		—
Convertible debt instrument - non-current asset		52		—		—		52

Total assets		176		124		—		52

Quoted market prices are used to estimate the fair value of marketable securities, which are valued at fair value on a recurring basis.

The fair value of the interest rate cap is calculated using well-established independent valuation techniques using expected LIBOR interest rates and counterparty non-performance credit risk assumptions as at June 30, 2018. The calculation of the credit risk in the cap values is subject to a number of assumptions included an assumed credit default swap rate based on recovery rate from the counterparty that we hold the interest rate cap with, given an event of default.

The convertible debt instrument is bifurcated into two elements. The fair value of the embedded derivative option is calculated using a modified version of the Black-Scholes formula for a currency translated option. Assumptions include Archer’s share price in NOK, NOK/USD FX volatility and dividend yield. The fair value of the debt component is derived using the DCF model including assumptions relating to cost of debt and credit risk associated to the instrument.

The following table is a reconciliation of the convertible debt instrument classified within Level 3 of the valuation hierarchy for the periods indicated:


(In $ millions)	Total fair value (Level 3)
As at December 31, 2017		52
Change in fair valued recognized in the Statement of Operations		4
Change in fair value recognized in Other Comprehensive Income		2

As at June 30, 2018		58

Credit risk

We have financial assets, including cash and cash equivalents, marketable securities, other receivables and certain amounts receivable on derivative instruments, mainly forward exchange contracts and interest rate swaps. These assets expose us to credit risk arising from possible default by the counterparty. We consider the counterparties to be creditworthy financial institutions and does not expect any significant loss to result from non-performance by such counterparties. We, in the normal course of business, do not demand collateral. The credit exposure of interest rate swap agreements, currency option contracts and foreign currency contracts is represented by the fair value of contracts with a positive fair value at the end of each period, reduced by the effects of master netting agreements, adjusted for counterparty non-performance credit risk assumptions. It is our policy to enter into master netting agreements with the counterparties to derivative financial instrument contracts, which give us the legal right to discharge all or a portion of amounts owed to a counterparty by offsetting them against amounts that the counterparty owes to us.

Variable Interest Entities (VIEs)

6 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable Interest Entities (VIEs)

Note 23 – Variable Interest Entities (VIEs)

As at June 30, 2018, we leased two semi-submersible rigs, and one jack-up rig from Ship Finance VIEs under capital leases. Each of the units had been sold by us to single purpose subsidiaries of Ship Finance and simultaneously leased back by us on bareboat charter contracts for a term of 15 years. We have several options to repurchase the units during the charter periods, and obligations to purchase the assets at the end of the 15-year lease period.

The following table gives a summary of the sale and leaseback arrangements, as at June 30, 2018:

Unit

Effective
from

Sale value
(In $ millions)

First
repurchase
option
(In $ millions)

Month of first
repurchase
option

Last
repurchase
option
(In $ millions)

Month of last
repurchase
Option*

West Taurus

Nov 2008

850

418

Feb 2015

149

⁽¹⁾

Nov 2023

West Hercules

Oct 2008

850

580

Aug 2011

135

⁽¹⁾

Aug 2023

West Linus

June 2013

600

370

June 2018

170

⁽²⁾

June 2028

⁽¹⁾	Purchase obligations at the end of the 15-year lease period

⁽²⁾	Ship Finance has a right to require us to purchase the West Linus rig on the 15^th anniversary for $100 million if we do not exercise the final repurchase option

We determine that the Ship Finance subsidiaries, which own the units, are VIEs, and that we are the primary beneficiary of the risks and rewards connected with the ownership of the units and the charter contracts. Accordingly, these VIEs are fully consolidated in our consolidated financial statements. We did not record any gains from the sale of the units, as they continued to be reported as assets at their original cost in our consolidated balance sheet at the time of each transaction. The equity attributable to Ship Finance in the VIEs is included in non-controlling interests in our consolidated financial statements. At June 30, 2018 and at December 31, 2017 the units are reported under drilling units in our consolidated balance sheet.

The bareboat charter rates are set on the basis of a base LIBOR interest rate for each bareboat charter contract, and thereafter are adjusted for differences between the LIBOR fixing each month and the base LIBOR interest rate for each contract. A summary of the bareboat charter rates per day for each unit is given below.


	(In $ thousands)
Unit	2018		2019		2020		2021		2022		2023
West Taurus		112		103		101		97		96		181
West Hercules		118		101		100		96		96		184
West Linus		158		122		99		99		93		189

The assets and liabilities in the financial statements of the VIEs as at June 30, 2018 and as at December 31, 2017 are as follows:


	As at June 30, 2018						As at December 31, 2017
(In $ millions)	SFL Deepwater Limited		SFL Hercules Limited		SFL Linus Limited		SFL Deepwater Limited		SFL Hercules Limited		SFL Linus Limited
Name of unit	West Taurus		West Hercules		West Linus		West Taurus		West Hercules		West Linus
Investment in finance lease		326		316		414		335		326		431
Amount due from related parties		3		4		—		4		4		—
Other assets		6		6		7		6		6		8

Total assets of the VIEs		335		326		421		345		336		439

Short-term interest bearing debt		19		28		45		226		27		48
Long-term interest bearing debt		196		210		240		—		224		261
Other liabilities		10		10		—		3		2		—
Short-term amounts due to related parties		—		—		12		—		—		4
Long-term debt due to related parties		106		73		115		113		80		121

Total liabilities of the VIEs		331		321		412		342		333		434

Equity of the VIEs		4		5		9		3		3		5

Book value of units in the Company’s consolidated financial statements		373		525		504		385		508		515

We present balances due to/from Ship Finance on a net basis, due to the fact there is a right of offset established in the long-term loan agreements, and the balances are intended to be settled on a net basis. As at June 30, 2018, we presented receivable balances (current assets) of $7 million related to SFL Deepwater Ltd, $7 million related to SFL Hercules Ltd, and $6 million related to SFL Linus Ltd against “Long-term debt due to related parties” within “Non-current liabilities” in the consolidated balance sheet. As at December 31, 2017, we had no receivable balances presented against “Long-term debt due to related parties” within “Non-current liabilities” in the Consolidated Balance Sheets.

In the period ended June 30, 2018 the VIEs declared no dividends (June 30, 2017: $14 million).

Related party transactions

6 Months Ended

Jun. 30, 2018

Related party transactions

Note 24 – Related party transactions

Seadrill Partners

The net income/(expenses) with Seadrill Partners for the six months ended June 30, 2018 and 2017 were as follows:


(In US$ millions)	Six Months Ended June 30,
	2018			2017
Management fees charged to Seadrill Partners - Other revenues (a) and (b)		35			37
Rig operating expenses charged to Seadrill Partners - Other revenues (c)		1			13
Contingent consideration realized (d)		7			11
Interest recognized on deferred consideration receivable (d)		2			2
Insurance premiums charged to Seadrill Partners (e)		5			5
Rig operating costs charged by Seadrill Partners (f)		(1	)		(2	)
Bareboat charter arrangements (g)		—			3
Interest expenses charged to Seadrill Partners (h)		—			5
Related party inventory purchases		(3	)		(2	)
Derivatives recharged to Seadrill Partners (i)		—			1

Net related party income from Seadrill Partners		46			73

Receivables/(payables) with Seadrill Partners and its subsidiaries as at June 30, 2018 and December 31, 2017 consisted of the following:


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Rig financing and loan agreements (j)		—			25
Deferred consideration receivable (d)		41			52
Other receivables (k)		148			157
Other payables (k)		(7	)		(24	)

The following is a summary of the related party agreements with Seadrill Partners:

(a, b) Management, administrative, and technical service agreements

Income recognized under the management, administrative and technical service agreements for the six months ended June 30, 2018 were a total of $35 million (six months ended June 30, 2017: income of $37 million).

(c) Rig operating costs charged to Seadrill Partners

Seadrill has charged to Seadrill Partners certain rig operating costs in relation to costs incurred on behalf of the West Polaris operating in Angola in 2017. In 2018, the West Polaris was mobilized to Spain and therefore not subject to any further operating costs from Angola. The total other revenues earned for the six months ended June 30, 2018 were $1 million (six months ended June 30, 2017: $13 million).

(d) Deferred consideration receivable

From the disposal of the West Vela and West Polaris to Seadrill Partners in November 2014 and June 2015 respectively, we recognized deferred consideration which as at June 30, 2018 the total outstanding balance in relation to these receivables was $41 million (December 31, 2017: $52 million). Refer to Note 8—Loss on disposals and contingent consideration for more information.

(e) Insurance premiums

We negotiate insurance for drilling units on a centralized basis. The total insurance premiums related to Seadrill Partners drilling units charged to Seadrill Partners for the six months ended June 30, 2018 were $5 million (six months ended June 30, 2017: $5 million).

(f) Rig operating costs charged by Seadrill Partners

Seadrill Partners has charged to Seadrill, through its Nigerian service company, certain services, including the provision of onshore and offshore personnel, which was provided for the West Jupiter drilling rig operating in Nigeria. The total rig operating expenses incurred for the six months ended June 30, 2018 were $1 million (six months ended June 30, 2017: $2 million).

(g) Bareboat charter arrangements

In connection with the transfer of the West Aquarius operations to Canada, the West Aquarius drilling contract was assigned to Seadrill Canada Ltd., a wholly owned subsidiary of Seadrill Partners, necessitating certain changes to the related party contractual arrangements relating to the West Aquarius. Seadrill China Operations Ltd S.A.R.L., the owner of the West Aquarius and a wholly-owned subsidiary of Seadrill Partners, had previously entered into a bareboat charter arrangement with Seadrill Offshore AS, a wholly-owned subsidiary of Seadrill, providing Seadrill Offshore AS with the right to use the West Aquarius. In October 2012, this bareboat charter arrangement was replaced with a new bareboat charter between Seadrill China Operations Ltd S.A.R.L. and Seadrill Offshore AS, and at the same time, Seadrill Offshore AS entered into a bareboat charter arrangement providing Seadrill Canada Ltd. with the right to use the West Aquarius in order to perform its obligations under the drilling contract described above. The net effect to Seadrill of the bareboat charters for the six months ended June 30, 2018 was net revenue of nil (six months ended June 30, 2017: net revenue of $3 million). The contract was terminated effective April 19, 2017 on completion of the rig’s contract with Hibernia Management.

(h) Interest expenses

The total interest income charged to Seadrill Partners for the related party loan arrangements outlined below for the six months ended June 30, 2018 was nil (six months ended June 30, 2017: $5 million). Refer to the sections below for details on the financing agreements.

(i) Derivative interest rate swap agreements

We previously held interest rate swap agreements with Seadrill Partners on a back to back basis with certain of its own interest rate swap agreements. On commencement of Chapter 11 proceedings the derivative position held by Seadrill was cancelled and held at the claimed value by the derivative counterparty. This resulted in no further recharged gains or losses on derivatives after September 12, 2017. The total net derivative gains and losses charged to Seadrill Partners for the six months ended June 30, 2018 was nil (six months ended June 30, 2017: gain of $1 million).

(j) Rig financing agreements

The West Vencedor loan agreement between us and Seadrill Partners was scheduled to mature in June 2015 and all outstanding amounts thereunder would be due and payable, including a balloon payment of $70 million. On April 14, 2015 the loan agreement was amended and the maturity date was extended to June 25, 2018. The West Vencedor loan agreement bears a margin of 2.3%, a guarantee fee of 1.4% and a balloon payment of $21 million due at maturity in June 2018. The loan was repaid in full during the period ended June 30, 2018 (December 31, 2017: $25 million).

(k) Receivables and Payables

Receivables and payables with Seadrill Partners and its subsidiaries are comprised of management fees, advisory and administrative services, and other items including accrued interest. In addition, certain receivables and payables arise when we pay an invoice on behalf of Seadrill Partners or its subsidiaries and vice versa. Receivables and payables are generally settled quarterly in arrears. Trading balances to Seadrill Partners and its subsidiaries are unsecured and are intended to be settled in the ordinary course of business.

Guarantees

Seadrill provides certain guarantees on behalf of Seadrill Partners:

•

Guarantees in favor of customers, which guarantee the performance of the Seadrill Partners drilling units, totaled $57 million as at June 30, 2018 (December 31, 2017: $165 million);

•

Guarantees in favor of banks provided on behalf of Seadrill Partners totaled nil as at December 31, 2017 after Seadrill Partners insulated itself from Seadrill in August 2017; and

•

Guarantees in favor of suppliers provided on behalf of Seadrill Partners, relating to customs guarantees totaled nil as at June 30, 2018 (December 31, 2017: $0.6 million).

West Vela facility

The $1.5 billion secured credit facility agreement related to both the West Vela drillship (owned by Seadrill Partners) and West Tellus drillship (owned by Seadrill). Certain subsidiaries of Seadrill and Seadrill Partners were jointly and severally liable for their own debt and obligations under the facility and the debt and obligations of other borrowers. In August 2017, the facility was split into two separate facilities “West Vela facility” and “West Tellus facility”. Recourse under the West Vela facility was then only to Seadrill Partners consolidated entities and recourse under the West Tellus facility was only to Seadrill consolidated entities.

West Polaris facility

In June 2015, we completed the sale of the entities that own and operate the West Polaris to Seadrill Partners. One of the entities sold was the sole borrower under $420 million senior secured credit facility. See Note 8 - Contingent consideration for further details. Prior to August 2017, we acted as a guarantor under the facility. In August 2017, we resigned as a guarantor to the facility. Recourse under the West Polaris facility is now only to Seadrill Partners consolidated entities.

T-15 / T-16 facility

The secured credit facility relating to the T-15 and T-16 tender rigs (owned by Seadrill Partners) and West Telesto jack-up (owned by Seadrill). was split into two separate facilities “Tender Rig facility” and “West Telesto facility” in August 2017. Recourse under the Tender Rig facility was then only to Seadrill Partners consolidated entities and recourse under the West Telesto facility was only to Seadrill consolidated entities. The Tender Rig facility was also amended so that the facility was directly held in Seadrill Partners (previously Seadrill was the borrower under the facility and there was a back to back agreement with Seadrill Partners).

Archer transactions

Archer restructuring

During the first half of 2017 Archer completed a series of restructuring transactions which resulted in changes to our involvement in the financial support provided to Archer and also the proportion of Archer shares held by us. The effects of this restructuring are summarized below and set out in more detail in the following sections.

At March 31, 2017, we provided financial support to Archer, a related party in the form of $278 million in financial guarantees for the benefit of its lenders and $149 million in subordinated loans including accrued interest and fees (carrying value of $37 million).

On April 26, 2017 we agreed with Archer to convert total outstanding subordinated loans provided to Archer, inclusive of associated fees and interest, with a carrying value of $37 million, into a $45 million loan. The new loan receivable is a convertible debt instrument comprised of a debt instrument and a conversion option, classed as an embedded derivative. Both elements are required to be measured at fair value at each reporting date. The fair value of the new loan receivable as at inception, April 26, 2017, was $56 million, resulting in a $19 million gain on the extinguishment of the original subordinated debt in the statement of operations.

At at June 30, 2018 the fair value of the convertible debt instrument was $58 million of which the split between debt and embedded derivative option was $46 million and $12 million respectively. The debt and embedded derivative option was revalued at the period end and we have recognized a fair value gain on the debt component of $2 million and a fair value gain on the embedded conversion option of $4 million for the six months ending June 30, 2018.

During the quarter ended June 30, 2017, we also signed and closed an agreement with Archer and its lenders to extinguish $278 million in financial guarantees provided by us in exchange for cash payment of $28 million. We had previously (in fiscal year 2016) recognized a contingent liability of $28 million to reflect this expected cash settlement.

Following Archer’s $100 million private placement on February 28, 2017, our shareholding was diluted from 39.89% to 16.23%. After a subsequent share placement by Archer on 26 April 2017, our shareholding was further diluted to 15.69%. At this date our investment in Archer was derecognized as an equity accounted investment and recognized as an available-for-sale security. For further information, please refer to Note 12 “Marketable securities”.

Total interest income for the six months ended June 30, 2018 for the above loans was nil (six months ended June 30, 2017: $3 million).

Guarantees

On February 5, 2014, we provided Archer with a guarantee to support Archer’s leasing obligations of a warehouse for a period of 10 years. The guarantee outstanding as at June 30, 2018 is $9 million (December 31, 2017: $10 million).

These guarantee fees are included in “Other financial items and other income /(expense), net” in our Consolidated Statement of Operations. The guarantee fees charged were nil for the six months ended June 30, 2018 (six months ended June 30, 2017: nil).

Operating activities

Archer provides certain technical vessel and rig services for us, and charged us fees of $0.1 million for the six months ended June 30, 2018 (six months ended June 30, 2017: $0.2 million). These amounts are included in “Vessel and rig operating expenses” in our consolidated statement of operations.

SeaMex Limited transactions

As at March 10, 2015, the date of deconsolidation, SeaMex Limited is considered to be a related party and not a controlled subsidiary of ours. The following is a summary of the related party agreements/transactions with SeaMex.

Management and administrative service agreements

In connection with the joint venture agreement, SeaMex, entered into a management support agreement with Seadrill Management Ltd, a wholly owned subsidiary of ours, pursuant to which Seadrill Management Ltd provides SeaMex certain management and administrative services. The services provided by Seadrill Management Ltd are charged at cost plus management fee ranging from 4.5% to 8%. The agreement can be terminated by providing 60 days written notice. Income recognized under the management and administrative agreements for the six months ended June 30, 2018 was $5 million (six months ended June 30, 2017: $5 million).

It is also agreed that Seadrill Jack Up Operations De Mexico, which is a 100% owned subsidiary of SeaMex and provides support services to the rigs acquired by the joint venture, will continue to provide management services to Seadrill in respect of managing the rigs West Pegasus and West Freedom and charge a fee ranging from 5% to 8% plus costs incurred in connection with managing the rigs on its behalf. Seadrill Jack Up Operations De Mexico has charged us fees, under the above agreements of $1 million for the six months ended June 30, 2018 (six months ended June 30, 2017: $3 million). These amounts are included in general and administrative expenses within the consolidated statement of operations.

Loans

$250 million Seller’s credit - In March 2015, we provided Seamex with a $250 million loan as part of the settlement of the sale of assets to SeaMex. The loan is divided into two facilities, (a) a term loan facility for an amount up to $230 million and (b) a revolving loan facility of up to $20 million. Both facilities bear interest at a rate of LIBOR plus a margin of 6.50% and mature in December 2019. Interest on the loan is payable quarterly in arrears. The loan facility is subordinated to SeaMex’s external debt facility. The outstanding balance as at June 30, 2018 was $250 million (December 31, 2017: $250 million) excluding accrued interest.

$45 million loan facility - In November 2016 we agreed a $45 million loan with Seamex to fund short term working capital requirements. The loan facility is subordinated to SeaMex’s external debt facility. The facility bears interest at a rate of LIBOR plus a margin of 6.5% payable quarterly in arrears.

Interest income accrued for the six months ended June 30, 2018 in respect of the loans above was $12 million (six months ended June 30, 2017: $17 million).

Receivables and Payables

Receivables and payables with SeaMex joint venture are comprised of short-term funding, management fees, advisory and administrative services, and other items including accrued interest. Receivables and payables are generally settled quarterly in arrears in the ordinary course of business.

Receivables/(payables) with SeaMex joint venture as at June 30, 2018 consisted of the following:


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Seller’s credit		250			250
$45 million loan facility		45			45
Interest on long-term funding and seller’s credit		62			50
Other receivables		39			32
Other payables		(1	)		(3	)

Performance Guarantees

In addition, Seadrill has also provided performance guarantees for the SeaMex drilling units, up to a total of $30 million as at June 30, 2018 (December 31, 2017: $30 million).

Seabras Sapura transactions

Seabras Sapura Participações S.A. and Seabras Sapura Holding GmbH, along with their wholly owned subsidiaries, are together referred to as Seabras Sapura. Seabras Sapura are joint ventures that construct, own and operate pipe-laying service vessels in Brazil and are owned 50% by us and 50% by TL Offshore, a subsidiary of Sapura Energy Berhad.

Loans

In May 2014, we provided a loan to Sapura Navegaceo Martima S.A. of $11 million, which was novated to Seabras Sapura Participações S.A. on December 30, 2015. The loan bears an interest rate of 3.4% and was initially repayable by May 31, 2015. On May 28, 2015 the maturity date for this loan was extended to May 31, 2016. Subsequently, the loan agreement was amended and maturity date extended to February 28, 2017 and then to May 31, 2017. As at June 30, 2017, the loan agreement was amended and the debt is now repayable on demand. The outstanding balance as at June 30, 2018 was $11 million (December 31, 2017: $11 million).

In January 2015, we provided a loan to Sapura Navegacao Martima S.A. of $18 million, which was novated to Seabras Sapura Participações S.A. on December 30, 2015. The loan bears an interest rate of 3.4% and was initially repayable by February 16, 2016. Subsequently, the loan agreement was amended and maturity date extended to February 28, 2017 and then to May 31, 2017. As at June 30, 2017, the loan agreement was amended and the debt is now repayable on demand. The outstanding balance as at June 30, 2018 was $18 million (December 31, 2017: $18 million).

In April 2015, we provided a loan to Sapura Onix GmbH of $14 million in connection with delivery of the Seabras Onix pipe-laying vessel. The outstanding balance as at June 30, 2018 was $14 million (December 31, 2017: $14 million). The loan bears an interest rate of LIBOR plus 3.99% and is repayable on demand, subject to certain restrictions under the agreement.

In December 30, 2015, we provided a loan to Seabras Sapura Participações S.A. of $3 million relating to the payments for equipment. The outstanding balance as at June 30, 2018 was $3 million (December 31, 2017: $3 million). The loan bears an interest rate of 4.4% on overdue balances, and was due to be repaid on February 28, 2017. This facility is now repayable on demand.

In June 2016, the Company provided a subordinated loan to Seabras Rubi GmbH of $14 million in connection with delivery of the Seabras Rubi pipe-laying vessel. The loan bears an interest rate of 3.99% plus LIBOR and is repayable on demand, subject to certain restrictions under the agreement. The outstanding balance as at June 30, 2018 was $14 million (December 31, 2017: $14 million).

In October 2016, the Company provided a subordinated loan to Seabras Jade GmbH of $12 million in relation to the funding retention account in the joint venture for the Sapura Jade vessel. The loan bears an interest rate of 3.99% plus LIBOR and is repayable on demand, subject to certain restrictions under the agreement. The outstanding balance as at June 30, 2018 was $12 million (December 31, 2017: $12 million).

In December 2016, the Company provided a subordinated loan to Seabras Onix GmbH, $6 million in relation to the funding retention accounts in the joint venture for the vessels. The loan bears an interest rate of 3.99% plus LIBOR and is repayable on demand, subject to certain restrictions under the agreement. The outstanding balance as at June 30, 2018 was $6 million (December 31, 2017: $6 million).

In December 2016, the Company provided a subordinated loan to Seabras Diamante GmbH, $7 million in relation to the funding retention accounts in the joint venture for the vessels. The loan bears an interest rate of 4.5% and is repayable on demand, subject to certain restrictions under the agreement. The outstanding balance as at June 30, 2018 was $7 million (December 31, 2017: $7 million).

In December 2016, the Company provided a subordinated loan to Seabras Topazio GmbH, $7 million in relation to the funding retention accounts in the joint venture for the vessels. The loan bears an interest rate of 4.5% and is repayable on demand, subject to certain restrictions under the agreement. The outstanding balance as at June 30, 2018 was $7 million (December 31, 2017: $7 million).

The total net interest income of the above loans relating to Seabras Sapura for six months ended June 30, 2018 was $2 million (six months ended June 30, 2017: $2 million). The total accrued interest as at June 30, 2018 was $10 million (December 31, 2017: $8 million).

Financial guarantees

PLSV I - In December 2013 certain subsidiaries of Seabras Sapura Holding GmbH entered into a $543 million senior secured credit facility agreement in order to part fund the acquisition of the Sapura Diamante, and Sapura Topazio pipe-laying support vessels. As a condition to the lenders making the loan available to each of the borrowers, the Company provides a sponsor guarantee, on a 50:50 basis with the joint venture partner, Sapura Energy Berhad, in respect of the obligations of the borrowers during certain defined time periods, the release of such guarantees being subject to the satisfaction of certain defined conditions. The guarantees cover obligations and liabilities of the borrowers under the facility agreement which arise during the period between the expiry of a contract and extension or renewal of that contract and following a guarantee extension relating to early termination of a contract. During these periods, the guarantees can only be called if the facility is in default. The total amount guaranteed by Seadrill as at June 30, 2018 was $174 million (December 31, 2017: $186 million). The guarantees provided by Seadrill and Sapura Energy Berhad secure the full outstanding amount under the facility agreement.

PLSV II - In April 2015 certain subsidiaries of Seabras Sapura Holding GmbH entered into a $780 million senior secured credit facility agreement in order to part fund the acquisition of the Sapura Onix, Sapura Jade and Sapura Rubi pipe-laying support vessels. As a condition to the lenders making the loan available to each of the borrowers, the Company provides a sponsor guarantee, on a 50:50 basis with the joint venture partner, Sapura Energy Berhad, in respect of the obligations of the borrowers during certain defined time periods, the release of such guarantees being subject to the satisfaction of certain defined conditions. The guarantees cover obligations and liabilities of the borrowers under the facility agreement which arise during the period between the expiry of a contract and extension or renewal of that contract and following a guarantee extension relating to early termination of a contract. During these periods, the guarantees can only be called if the facility is in default. The amount guaranteed by Seadrill as at June 30, 2018 was $312 million (December 31, 2017: $328 million).

Sapura Esmeralda—In November 2012 a subsidiary of Seabras Sapura Participações S.A. entered into a $179 million senior secured credit facility agreement in order to part fund the acquisition of the Sapura Esmeralda pipe-laying support vessel, with a maturity in 2032. During 2013 an additional facility of $36 million was entered into, with a maturity in 2020. As a condition to the lenders making the loan available the borrower, a wholly owned subsidiary of the Company provided a sponsor guarantee, on a joint and several basis with the joint venture partner, TL Offshore Sdn. Bhd. in respect of the obligations of the borrower. The total amount guaranteed by the subsidiaries of the joint venture partners as at June 30, 2018 was $174 million (December 31, 2017: $184 million).

The Sapura Esmeralda, operates under a temporary Brazilian flag which expires on July 29, 2019. Seabras Sapura is currently in the process of applying for a registration with Brazilian authorities which will either entitle the vessel to permanently fly the Brazilian flag. There is a risk that if no permanent right to fly the Brazilian flag will be obtained, or that the temporary flag will be revoked and Seabras Sapura is unsuccessful in any appeals or in pursuing other available remedies, this could affect the operations of the Sapura Esmeralda and potentially impact its commercial agreements and related financing.

The Group has signed a term sheet with the lenders and Sapura Energy Berhard which contemplates the extinguishment of the sponsor guarantees (for PLSV I and PLSV II) in return for prepayments to the lenders using the joint venture cash on hand.

As at the Consolidated Balance Sheet date, we have not recognized a liability as we do not consider it is probable that the guarantees will be called.

Operating activities

A subsidiary of Seabras Sapura sublets warehouse and office space to subsidiaries of the Company in Brazil. The amount charged for the six months ended June 30, 2018 was $1.0 million (six months ended June 30, 2017: $0.6 million). These amounts are included in “Vessel and rig operating expenses” in the Consolidated Statement of Operations.

Other trading balances with Seabras Sapura, including interest receivable, totaled a receivable of $4 million as at June 30, 2018 (December 31, 2017: $6 million).

Related parties to Hemen Holding Ltd (“Hemen”)

The Company transacts business with the following related parties, being companies in which our principal shareholder, Hemen, has a significant interest:

•

Ship Finance International Limited (“Ship Finance”);

•

Metrogas Holdings Inc. (“Metrogas”);

•

Archer;

•

Frontline Management (Bermuda) Limited (“Frontline”); and

•

Seatankers Management Norway AS (“Seatankers”).

Ship Finance transactions

We have entered into sale and lease back contracts for several drilling units, with subsidiaries of Ship Finance. We have determined that the Ship Finance subsidiaries, which own the units, are variable interest entities (VIEs), and that we are the primary beneficiary of the risks and rewards connected with the ownership of the units and the charter contracts. Accordingly, these VIEs are fully consolidated in our Consolidated Financial Statements.

Refer to Note 23 “Variable Interest Entities” for further details. The equity attributable to Ship Finance in the VIEs is included in non-controlling interests in our Consolidated Financial Statements.

During the six month periods ended June 30, 2018 and 2017, we incurred the following lease costs on units leased back from Ship Finance subsidiaries:


	Six Months Ended June 30,
	2018		2017
West Hercules		20		28
West Taurus		18		25
West Linus		30		41

Total		68		94

These lease costs are eliminated on consolidation.

The VIEs had net loans due to Ship Finance amounting to $294 million (December 31, 2017: $314 million) and gross loans of $318 million (December 31, 2017: $314 million) as at June 30, 2018. There is a right of offset of trading balance assets against the loans, the net position is disclosed within “Long-term debt due to related parties” on the Consolidated Balance Sheet. As at June 30, 2018 the trading position was a net liability position of $20 million which is disclosed within “Short -term amounts due to related parties” on the Consolidated Balance Sheet. The loans bear interest at a fixed rate of 4.5% per annum, and mature between 2023 and 2029. The total interest expense incurred for the six months ended June 30, 2018 was $7 million (six months ended June 30, 2017: $9.3 million).

Due to the right of offset, when the VIE trading balance is in an asset position this will be disclosed net against the loan within “Long-term debt due to related parties” on the Consolidated Balance Sheet.

Frontline transactions

Frontline provides certain management support and administrative services for Seadrill, resulting in a charged fee of $1.5 million for the six months ended June 30, 2017. In the six months ended June 30, 2018 a cost adjustment for prior period services was recorded, resulting in net income of $1.1 million.

Seatankers Management transactions

The Company and its subsidiaries receive services from Seatankers Management Norway AS, an affiliate of Hemen. The fee was $1.3 million and $0.7 million for the six months ended June 30, 2018 and 2017, respectively.

Commitments and contingencies

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and contingencies

Note 25 – Commitments and contingencies

Purchase Commitments

As at June 30, 2018, we had contractual commitments under eight newbuilding contracts totaling $1.7 billion ($1.7 billion as at December 31, 2017). The newbuilding commitments are for eight jack-up contracts that we have with the Dalian shipyard. These contracts are all with limited liability subsidiaries of Seadrill Limited that do not have the benefit of a Seadrill Limited guarantee. We continue discussions with Dalian regarding taking delivery of these units.

The table below shows the maturity schedule for the newbuilding contractual commitments as of June 30, 2018.


(In $ millions)	As at June 30, 2018
2018		1,683
2019		—
2020		—
2021		—

Total purchase commitments		1,683

Legal Proceedings

From time to time we are a party, as plaintiff or defendant, to lawsuits in various jurisdictions for demurrage, damages, off-hire and other claims and commercial disputes arising from the construction or operation of our drilling units, in the ordinary course of business or in connection with our acquisition or disposal activities. We believe that the resolution of such claims will not have a material impact individually or in the aggregate on our operations or financial condition. Our best estimate of the outcome of the various disputes has been reflected in our consolidated financial statements as at June 30, 2018.

Class action

In December 2014, a purported shareholder class action lawsuit, Fuchs et al. v. Seadrill Limited et al., No. 14-cv-9642 (LGS)(KNF), was filed in U.S. Federal District Court in the Southern District of New York, alleging, among other things, that Seadrill and certain of our executives made materially false and misleading statements in connection with the payment of dividends. In January 2015, a second purported shareholder class action lawsuit, Heron v. Seadrill Limited et al., No. 15-cv-0429 (LGS)(KNF), was filed in the same court on similar grounds. In March 2015, a third purported shareholder class action lawsuit, Glow v. Seadrill Limited et al., No. 15-cv-1770 (LGS)(KNF), was filed in the same court on similar grounds. On March 24, 2015, the court consolidated these complaints into a single action. On June 23, 2015 the court appointed co-lead plaintiffs and co-lead counsel and ordered the co-lead plaintiffs to file a single consolidated amended complaint by July 23, 2015.

The amended complaint was filed on July 23, 2015 alleging, among other things, that Seadrill, North Atlantic Drilling Ltd and certain of their executives made materially false and misleading statements in connection with the payment of dividends, the failure to disclose the risks to the Rosneft transaction as a result of various enacted government sanctions and the inclusion in backlog of $4.1 billion attributable to the Rosneft transaction. The defendants filed their Motion to Dismiss the Complaint on October 13, 2015. The plaintiffs, in turn, filed their Opposition to the Motion to Dismiss on November 12, 2015 and the defendants’ Reply Brief was served on December 4, 2015. On June 21, 2016 the court issued an order granting the defendants’ Motion to Dismiss. On July 15, 2016 the Court entered a judgment dismissing the Complaint with prejudice. The thirty days’ appeal period has expired without appeal and the matter is therefore closed. In connection with the voluntary requests for information concerning, among other things, statements in connection with payment of dividends, the inclusion of contracts in our backlog, and our contracts with Rosneft, we have been notified by the U.S. Securities and Exchange Commission that they are not taking any further action.

Sevan Drilling

On June 29, 2015, Sevan Drilling disclosed that it had initiated an internal investigation into activities with an agent under certain drilling contracts with Petrobras in Brazil, which were entered prior to the separation from the Sevan Marine Group. On October 16, 2015, Sevan Drilling further disclosed that Sevan Drilling ASA, previously the parent company of Sevan Drilling, had been accused of breaches of Sections 276a and 276b of the Norwegian Criminal Code in respect of payments made in connection with the performance during 2012 to 2015 of drilling contracts originally awarded by Petrobras to Sevan Marine ASA in the period between 2005–2008. On May 4, 2018, Sevan Drilling disclosed that Norway’s anti-corruption agency, Økokrim, had completed its investigation and that the charges had been dismissed. Accordingly no loss contingency has been recognized in Seadrill’s Consolidated Financial Statements.

Seabras Sapura joint venture

The Sapura Esmeralda, operates under a temporary Brazilian flag which expires on July 29, 2019. Seabras Sapura is currently in the process of applying for a registration with Brazilian authorities which will either entitle the vessel to permanently fly the Brazilian flag. There is a risk that if no permanent right to fly the Brazilian flag will be obtained, or that the temporary flag will be revoked and Seabras Sapura is unsuccessful in any appeals or in pursuing other available remedies, this could affect the operations of the Sapura Esmeralda and potentially impact its commercial agreements and related financing.

Patent infringement

In January 2015, a subsidiary of Transocean Ltd. filed suit against certain of our subsidiaries for patent infringement. The suit alleges that one of our drilling rigs operating in the U.S. Gulf of Mexico, along with two rigs owned by Seadrill Partners, violated Transocean patents relating to dual-activity. In the same year, we challenged the validity of the patents via the Inter Partes Review process within the U.S. Patent and Trademark Office. The IPR board held in March 2017 that the patents were valid. In May 2017 we appealed to the U.S. Federal Circuit Court of Appeal and in June 2018 the court affirmed the IPR decision. We do not believe that our rig(s) infringed the Transocean patents, which expired in the United States in May 2016, and we will continue to defend ourselves vigorously against this suit. We do not believe that the ultimate liability, if any, resulting from this litigation will have a material effect on our financial position. We have not previously recognized any related loss contingency in our Consolidated Financial Statements as of December 31, 2017 as we do not believe the loss to be probable.

Supplementary cash flow information

6 Months Ended

Jun. 30, 2018

Supplemental Cash Flow Elements [Abstract]

Supplementary cash flow information

Note 26 – Supplementary cash flow information

The table below summarizes the non-cash investing and financing activities relating to the periods presented:


	Six Months Ended June 30,
(In $ millions)	2018		2017
*Non-cash investing activities*
Sale of rigs and equipment ⁽¹⁾		—		74
*Non-cash financing activities*
Repayment of debt following sale of rigs and equipment ⁽¹⁾		—		(74	)
Dividend to non-controlling interests in VIEs ⁽²⁾		—		(14	)

⁽¹⁾

During the period ended June 30, 2017, we completed the sale of the West Triton and West Resolute to Shelf Drilling, receiving cash consideration of $76 million. This comprised sales value of $150 million, offset by $74 million of principal debt repayments paid on behalf of us by Shelf Drilling.

⁽²⁾	During the period ended June 30, 2017 the Ship Finance VIEs that we consolidate declared dividends payable totaling $14 million to Ship Finance. Refer to Note 23 “Variable Interest Entities” for more details.

Assets held for sale

6 Months Ended

Jun. 30, 2018

Discontinued Operations and Disposal Groups [Abstract]

Assets held for sale

Note 27 – Assets held for sale

West Rigel

On December 2, 2015, NADL signed an amendment with Jurong Shipyard (“Jurong”) for the deferral of the delivery of the semi-submersible drilling unit, the West Rigel (the “Unit”). The deferral period originally lasted until June 2, 2016, however this was subsequently extended to July 6, 2018.

In the event no employment was secured for the Unit, no alternative action is completed and following completion of the deferral period, we agreed with Jurong that we would form a Joint Asset Holding Company for joint ownership of the Unit, of which 23% was to be owned by us and 77% by Jurong.

On December 26, 2017, Jurong announced that a sale agreement, subject to conditions had been signed for West Rigel. As the agreement is pursuant to conditions being met, we continued to hold the asset within “Non-current assets held for sale” in the year ended December 31, 2017.

On April 5, 2018, we entered into a settlement and release agreement, subject to Bankruptcy Court approval, with Jurong whereby we agreed that our share of the sale proceeds from the sale of the West Rigel by Jurong would be $126 million. To reflect this as the asset held for sale value at December 31, 2017, a further $2 million loss on disposal was recognized in the Consolidated Statement of Operations.

On May 9, 2018 the West Rigel was sold by Jurong and we received a share of proceeds totaling $126 million.


(In $ millions)	Six months ended June 30, 2018			Year ended December 31, 2017
Opening balance at the beginning of the period		126			128
Sale of West Rigel		(126	)		—
Loss on disposal		—			(2	)

Non-current assets held for sale		—			126

Subsequent Events	6 Months Ended
Subsequent Events	Jun. 30, 2018
Subsequent Events [Abstract]
Subsequent Events	Note 28 – Subsequent Events Emergence from Chapter 11 On July 2, 2018, we successfully completed our reorganization pursuant to our Chapter 11 plan of reorganization and emerged from Chapter 11. All conditions precedent to the restructuring contemplated by the Plan have been satisfied or otherwise waived. The Plan has re-profiled our debt by extending near term maturities and provided substantial liquidity that puts us in a strong position to execute its business plan. The Plan equitized approximately $2.4 billion in unsecured bond obligations, more than $1 billion in contingent newbuild obligations, substantial unliquidated guaranty obligations, and c. $249 million in unsecured interest rate and currency swap claims. Additionally, the Plan reinstated c.$5.4 billion of senior secured credit facilities with extended maturities, provided us with over $1.0 billion in fresh capital and leaving employee, customer, and ordinary trade claims largely unimpaired. The Plan provides for New Seadrill to serve as the parent holding company for Seadrill’s subsidiaries after Seadrill’s and the other Debtors’ emerged from bankruptcy. New Seadrill was initially formed as a wholly-owned subsidiary of Seadrill and has not conducted any material operations prior to the Effective Date of the Plan. As part of the Debtors’ emergence from bankruptcy on July 2, 2018, the economic interests in the existing shares of Seadrill were extinguished, Seadrill will be dissolved under Bermuda law, and common shares of New Seadrill were issued to the parties entitled thereto under the Plan and under the Investment Agreement. The corporate reorganization also included the formation of two intermediate holding company subsidiaries of New Seadrill and the formation of NSNCo, which issued its New Secured Notes to the commitment parties and to participants in a rights offering to purchase New Secured Notes. New Secured Notes On July 2, 2018, we raised $880 million of aggregate principle amount of 12.0% senior secured notes due in 2025. The notes bear interest at the annual rate of 4.00% payable in cash plus at the annual rate of 8.00% payable in kind. Under certain circumstances, we may elect to pay the amount of payment in kind interest payable on any interest payment date in cash at an annual rate of 8.00%. Interest will be payable semi-annually in arrears. On August 8, 2018 these notes were admitted for listing on the Global Exchange Market of Euronext Dublin under the name Seadrill New Finance Limited. Fresh Start Reporting On the Effective Date, we expect to adopt fresh start reporting. Under fresh start reporting, the fair value of our assets and liabilities as of that date are expected to differ materially from the recorded values of our assets and liabilities as reflected in our historical Consolidated Financial Statements. In addition, we expect the adoption of fresh start accounting to materially affect the results of operations following the fresh start reporting date, as we will have a new basis in our assets and liabilities. Consequently, our historical financial statements would not be reliable indicators of our financial condition and results of operations for any period should we apply fresh start accounting New Board of Directors In accordance with the Plan, a newly constituted Board of Directors was appointed on July 2, 2018, consisting of John Fredriksen (chairman), Harald Thorstein, Kjell-Erik Østdahl, Scott D. Vogel, Peter J. Sharpe, Eugene I. Davis, and Birgitte Ringstad Vartdal.

General information (Policies)	6 Months Ended
General information (Policies)	Jun. 30, 2018
Accounting Policies [Abstract]
Basis of presentation	Basis of presentation The Consolidated Financial Statements are presented in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP). The amounts are presented in United States dollar (“U.S. dollar” or “US$”) rounded to the nearest million, unless otherwise stated. The accompanying Consolidated Financial Statements present the financial position of Seadrill Limited, the consolidated subsidiaries and our interests in associated entities. Investments in companies in which we control, or directly or indirectly hold more than 50% of the voting control are consolidated in the Consolidated Financial Statements, as well as certain variable interest entities of which we are deemed to be the primary beneficiary. The accompanying unaudited interim financial statements, in the opinion of management, include all material adjustments, consisting only of normal recurring adjustments that are considered necessary for a fair statement of the Company’s financial statements in accordance with generally accepted accounting principles in the United States of America. The accompanying unaudited interim financial statements do not include all of the disclosures required in complete annual financial statements. These financial statements should be read in conjunction with our annual financial statements filed with the SEC on Form 20-F for the year ended December 31, 2017.
Significant accounting policies	Significant accounting policies The accounting policies adopted in the preparation of the unaudited interim financial statements are consistent with those followed in the preparation of our annual audited consolidated financial statements for the year ended December 31, 2017 except as discussed below or unless otherwise included in these unaudited interim financial statements as separate disclosures.
Bankruptcy accounting	Bankruptcy accounting Seadrill Limited and certain of its direct and indirect consolidated subsidiaries (the “Debtors”) filed voluntary petitions on September 12, 2017 (the “Petition Date”) to commence prearranged reorganization proceedings under Chapter 11 of Title 11 of the United States Bankruptcy Code (“Bankruptcy Code”) in the Southern District of Texas (the “Bankruptcy Court”) [case number 17-60079]. The Debtors also commenced a provisional liquidation proceeding in Bermuda on behalf of the Bermudian entities. During the pendency of the Chapter 11 proceedings, the Debtors will operate its business as “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provision of the Bankruptcy Code. Refer to Note 3 “Chapter 11 Proceedings” for further information. The consolidated financial statements have been prepared as if we are a going concern and reflect the application of Accounting Standards Codification 852, Reorganizations (“ASC 852”). ASC 852 requires that the financial statements, for periods subsequent to filing bankruptcy petitions, distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, certain expenses, gains and losses that are realized or incurred in the bankruptcy proceedings are recorded in “Reorganization items” on our Consolidated Statements of Operations. In addition, ASC 852 provides for changes in the accounting and presentation of significant items on the Consolidated Balance Sheets, particularly liabilities. Pre-petition obligations that may be impacted by the Chapter 11 reorganization process have been classified on the Consolidated Balance Sheets within “Liabilities subject to compromise”. These liabilities are reported at the amounts expected to be allowed by the Bankruptcy Court, even if they may be settled for lesser amounts. Please see Note 28 – Subsequent Events for fresh start reporting considerations upon emergence.
Liquidity and ability to continue as a going concern	Liquidity and ability to continue as a going concern The Consolidated Financial Statements are prepared on a going concern basis and contemplate the realization of assets and satisfaction of liabilities in the normal course of business. We have historically relied on our cash generated from operations to meet our short-term liquidity needs. However, as a result of the downturn in the offshore industry, we were required to obtain additional liquidity to fully meet our short-term liquidity requirements. To obtain this additional liquidity and to implement the transactions contemplated as part of the RSA and Investment Agreement, we commenced Chapter 11 proceedings under the Bankruptcy Code on September 12, 2017. In our form 20-F covering our annual report for the fiscal year ended December 31, 2017, issued on April 12, 2018, we reported that these conditions gave rise to a substantial doubt over our ability to continue as a going concern for a period of at least twelve months after the date the financial statements were issued. On July 2, 2018, we emerged from the Chapter 11 Proceedings. The emergence from the Chapter 11 Proceedings and consummation of the Plan addressed our liquidity concerns as it provided for $1.08 billion of in new capital, equitized approximately $2.4 billion in unsecured bond obligations and approximately $250 million in unsecured interest rate and currency swaps, eliminated near-term amortization obligations and extended maturities on debt. We emerged from Chapter 11 with $2.1 billion of post emergence cash and $7.6 billion of outstanding debt principal. We believe that cash on hand, liquid investments, contract and other revenues will generate sufficient cash flow to fund our anticipated debt service and working capital requirements for the next twelve months. Therefore, there is no longer a substantial doubt over our ability to continue as a going concern for at least the twelve months after the date the financial statements are issued.

Liabilities subject to compromise (Tables)

6 Months Ended

Jun. 30, 2018

Schedule of Liabilities Subject to Compromise


(In $ millions)	June 30, 2018		December 31, 2017
Senior undersecured or impaired external debt		5,266		5,371
Unsecured bonds		2,334		2,334
Newbuild global settlement agreement		1,064		1,064
Derivatives previously recorded at fair value		249		249
Accounts payable and other liabilities		84		103
Accrued interest payable		49		50
Amount due to related party		4		20

Total liabilities subject to compromise		9,050		9,191

Segment information (Tables)

6 Months Ended

Jun. 30, 2018

Segment Reporting [Abstract]

Segment Results

Segment results are evaluated on the basis of operating income, and the information given below is based on information used for internal management reporting.

Total operating revenue


(In $ millions)	Six Months Ended June 30,
	2018		2017
Floaters		482		744
Jack-ups		193		360
Other		37		42

Total operating revenue		712		1,146

Depreciation and amortization


(In $ millions)	Six Months Ended June 30,
	2018		2017
Floaters		298		301
Jack-ups		93		105

Total		391		406

Operating loss - Net loss


(In $ millions)	Six Months Ended June 30,
	2018			2017
Floaters		(446	)		95
Jack-ups		(167	)		(115	)
Other		—			3

Operating loss		(613	)		(17	)

Unallocated items:
Total financial items and other		14			(96	)
Income taxes		(36	)		12

Net loss		(635	)		(101	)

Drilling units and Newbuildings - Total assets


(In $ millions)	June 30, 2018		December 31, 2017
Floaters		9,411		9,956
Jack-ups		3,369		3,508

Total drilling units and newbuildings		12,780		13,464

Unallocated items:
Assets held for sale		—		126
Investments in associated companies		1,615		1,473
Marketable securities		121		124
Cash and restricted cash		1,218		1,359
Other assets		1,311		1,436

Total assets		17,045		17,982

Drilling units and Newbuildings - Capital expenditures


(In $ millions)	Six Months Ended June 30,
	2018		2017
Floaters		93		54
Jack-ups		24		12

Total		117		66

Summary of Geographic Segment Data

The following information presents our revenues and fixed assets by geographic area:

Revenues


(In US$ millions)	Six Months Ended June 30,
	2018		2017
Brazil		188		197
Nigeria		105		110
Angola		100		249
Norway		82		115
Saudi Arabia		79		80
United States		30		187
Others ⁽¹⁾		128		208

Total		712		1,146

⁽¹⁾	Other countries represent countries in which we operate that individually had revenues representing less than 10% of total revenues earned for any of the periods presented.

Summary of Major Customers

We had the following customers with contract revenues greater than 10% in any of the periods presented:


(In US$ millions)	Six Months Ended June 30,
	2018			2017
Petroleo Brasileiro S.A (“Petrobras”)		27	%		17	%
Total S.A Group (“Total”)		20	%		22	%
Saudi Aramco		12	%		8	%
Exxon Mobil Corp (“Exxon”)		11	%		7	%
LLOG		5	%		18	%

Summary of Geographic Segment Data

Fixed assets – drilling units ⁽¹⁾


(In US$ millions)	As at June 30, 2018		As at December 31, 2017
Brazil		2,405		1,816
Norway		2,331		2,258
Malaysia		1,445		1,809
Spain		1,344		2,016
United States		1,239		1,266
Other ⁽²⁾		3,767		4,051

Total		12,531		13,216

⁽¹⁾

The fixed assets referred to in the table above exclude assets under construction. The countries in this table represent the location of the drilling unit at the end of the reporting period and are not necessarily indicative of the geographic distribution of the revenues or operating profits generated by the assets during the period. In most cases these locations are different to the country in which the Company that owns the drilling unit is registered.

⁽²⁾	“Other countries” represent countries in which we operate that individually had fixed assets representing less than 10% of total fixed assets for any of the periods presented.

Revenue from Contracts with Customers (Tables)

6 Months Ended

Jun. 30, 2018

Revenue from Contract with Customer [Abstract]

Schedule of Information about Receivables, Contract Assets and Contract Liabilities from Contracts with Customers

The following table provides information about receivables, contract assets and contract liabilities from our contracts with customers:


(In $ millions)	June 30, 2018			January 1, 2018
Accounts receivable, net		272			295
Current contract assets ⁽¹⁾		9			7
Current contract liabilities (deferred revenue) ⁽¹⁾		(25	)		(37	)
Non-current contract liabilities (deferred revenue) ⁽¹⁾		(7	)		(18	)

⁽¹⁾	Current contract asset and liability balances are included in “other current assets” and “other current liabilities,” respectively in our unaudited Consolidated Balance Sheet as of June 30, 2018.

Significant changes in the contract assets and the contract liabilities balances during the period are as follows:


(In $ millions)	Net Contract Balances
Contract assets at January 1, 2018		7
Contract liabilities at January 1, 2018		(55	)

Net contract liability at January 1, 2018		(48	)

Decrease due to amortization of revenue that was included in the beginning contract liability balance		25
Increase due to cash received, excluding amounts recognized as revenue		(9	)
Decrease due to recognized during the period but contingent on future performance		9

Net contract liability at June 30, 2018		(23	)

Contract assets at June 30, 2018		9
Contract liabilities at June 30, 2018		(32	)

Summary of Revenue Expected to be Recognized in Future Related to Performance Unsatisfied Obligations

The following table reflects revenue expected to be recognized in the future related to unsatisfied performance obligations as of June 30, 2018:


	For the Years Ending December 31,
(In $ millions)	2018⁽¹⁾			2019			Total
Deferred mobilization revenue		(11	)		(18	)		(29	)
Other deferred revenue		(2	)		(1	)		(3	)
Total		(13	)		(19	)		(32	)

⁽¹⁾

Represents the six-month period beginning July 1, 2018.

Reorganization items (Tables)

6 Months Ended

Jun. 30, 2018

Schedule of Reorganization Items

The following table summarizes the components included within reorganization items:


(In $ millions)	Six Months Ended June 30, 2018
Advisory and professional fees		(115	)
Interest income on surplus cash invested		6

Total reorganization items		(109	)

Loss on disposals and contingent consideration (Tables)

6 Months Ended

Jun. 30, 2018

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Summary of Loss on Disposals and Contingent Consideration


(In $ millions)	Six Months Ended June 30,
	2018		2017
Loss on disposals
Loss on disposal of West Triton to Shelf Drilling		—		(34	)
Loss on disposal of West Resolute to Shelf Drilling		—		(61	)
Loss on disposal of West Mischief to Shelf Drilling		—		(71	)

Total loss on disposals		—		(166	)

Contingent Consideration realized
West Polaris earn out realized		—		4
West Vela earn out realized		7		7

Total contingent consideration recognized		7		11

Summary of Earnings Per Share

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 45
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=65878427&loc=SL51721533-107759

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 4B
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721665-107760

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
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-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721683-107760

Reference 6: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
-Paragraph 3A
-URI http://asc.fasb.org/extlink&oid=84176398&loc=SL51724579-110230

Reference 7: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
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-Section 50
-Paragraph 4A
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721663-107760

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 360
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-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84176398&loc=d3e2941-110230

Reference 10: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
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Reference 11: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 205
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-Paragraph 5D
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721677-107760

+ Details

Earnings per share (Tables)

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

The components of the numerator for the calculation of basic and diluted EPS are as follows:


(In $ millions)	Six Months Ended June 30,
	2018			2017
Net loss		(477	)		(78	)
Less: Allocation to participating securities		—			—

Net loss available to shareholders		(477	)		(78	)

Effect of dilution		—			—

Diluted net loss available to shareholders		(477	)		(78	)

The components of the denominator for the calculation of basic and diluted EPS are as follows:


(In millions)	Six Months Ended June 30,
	2018			2017
Basic earnings per share:
Weighted average number of common shares outstanding		504			504
Diluted earnings per share:
Weighted average number of common shares outstanding		504			504
Effect of dilutive share options ⁽¹⁾		—			—
Effect of dilutive convertible bonds		—			—

Weighted average number of common shares outstanding adjusted for the effects of dilution		504			504

Basic (loss)/income per share (US dollar)		(0.95	)		(0.16	)

Diluted (loss)/income per share (US dollar)		(0.95	)		(0.16	)

⁽¹⁾	Certain stock options have been excluded from the calculation of diluted EPS because their exercise price exceeded our average share price during the calculation period.

Cash and cash equivalents (Tables)

6 Months Ended

Jun. 30, 2018

Cash and Cash Equivalents [Abstract]

Cash and cash equivalents


(In $ millions)	June 30, 2018		December 31, 2017
Cash and cash equivalents		809		1,255
Restricted cash⁽¹⁾		409		104

Total		1,218		1,359

⁽¹⁾

Restricted cash consists of bank deposits which have been pledged as collateral for certain guarantees issued by a bank or minimum deposits which must be maintained in accordance with contractual arrangements. Restricted cash amounts with maturities longer than one year are classified as non-current assets.

Marketable securities (Tables)

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Marketable Securities Held

The following tables summarize the carrying values of our ownership interests in Seadrill Partners’ common units and Archer ordinary units, which are held as marketable securities in the Consolidated Balance Sheet:


(In $ millions)	June 30, 2018		December 31, 2017
Seadrill Partners —Common units		91		96
Archer		30		28

Total marketable securities		121		124

Net Unrealized Gains and Losses Related to Marketable Securities

After we adopted ASU 2016-01 on January 1, 2018, changes in the fair value of investments in marketable securities are recorded in net income. We classify such gains within the line item “Unrealized loss on marketable securities” within the Consolidated Statement of Operations. The unrealized loss for the six months ended June 30, 2018 was as follows:


(In $ millions)	Six Months Ended June 30,

	2018
Seadrill Partners—Common Units—unrealized loss on marketable securities		(5	)
Archer—unrealized gain on marketable securities		2

Total unrealized loss on marketable securities		(3	)

Before we adopted ASU 2016-01 on January 1, 2018, changes in fair value of investments in marketable securities were initially recorded in other comprehensive income and then reclassified to net income when realized. We classified such gains within the line item “Unrealized gains on marketable securities” within the Consolidated Statement of Comprehensive income. The unrealized gain for the six months ended June 30, 2017 was as follows:


(In $ millions)	Six Months Ended June 30,
	2017
Seadrill Partners—Common Units—unrealized loss on marketable securities		(21	)
Archer—unrealized gain on marketable securities		27

Total unrealized gain on marketable securities		6

Investment in associated companies (Tables)

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Equity Method Investments

We have the following investments that are either recorded using the equity method or at cost less impairment for the periods presented in these Consolidated Financial Statements:


(In $ millions)	June 30, 2018		December 31, 2017
Seabras Sapura Participacoes		76		63
Seabras Sapura Holdco		334		290
Seadrill Partners—Total direct ownership interests		914		857
Seadrill Partners—Subordinated units		120		97
Seadrill Partners—Seadrill member interest and IDRs ⁽¹⁾		64		64
SeaMex Ltd		107		102

Total investment in associated companies		1,615		1,473

⁽¹⁾	The Seadrill Partners—Seadrill member interest and Incentive Distribution Rights (“IDRs”) are recorded at cost less impairment on the basis that they do not represent common stock interests and their fair value is not readily determinable.

Property plant and equipment (Tables)

6 Months Ended

Jun. 30, 2018

Drilling Unit [Member]


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Cost		17,452			17,335
Accumulated depreciation		(4,507	)		(4,119	)
Impairment		(414	)		—

Net book value		12,531			13,216

Newbuildings [Member]

Schedule of Debt Issuance Costs Against Current and Long-Term Debt


(In $ millions)	As at June 30, 2018		As at December 31, 2017
Total Newbuildings		249		248

Debt (Tables)

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Schedule of Debt


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Credit facilities:
$2,000 facility (North Atlantic Drilling) ⁽¹⁾		880			897
$400 facility ⁽¹⁾		130			133
$440 facility ⁽¹⁾		60			62
$1,450 facility ⁽¹⁾		311			318
$360 facility (Asia Offshore Drilling)		210			210
$300 facility ⁽¹⁾		140			142
$1,750 facility (Sevan Drilling) ⁽¹⁾		835			856
$450 facility ⁽¹⁾		255			261
$1,500 facility ⁽¹⁾		1,095			1,112
$1,350 facility ⁽¹⁾		913			931
$950 facility ⁽¹⁾		549			558
$450 facility (2015) ⁽¹⁾		98			101

Total credit facilities		5,476			5,581

Loans contained within VIEs:
$375 facility		237			251
$390 facility		215			226
$475 facility		285			309

Total loans contained within VIEs		737			786

Unsecured bonds:
NOK1,800 bond ⁽²⁾		231			231
$1,000 bond ⁽²⁾		843			843
$500 bond ⁽²⁾		479			479
NOK1,500 bond (NADL) ⁽²⁾		182			182
$ 600 bond (NADL) ⁽²⁾		413			413
SEK 1,500 bond ⁽²⁾		186			186

Total unsecured bonds		2,334			2,334

Total debt principal		8,547			8,701
Less: Debt balance held as subject to compromise		(7,600	)		(7,705	)

Total debt not subject to compromise		947			996

Less: current portion of debt principal		(91	)		(511	)

Long-term portion of debt principal		856			485

⁽¹⁾	Denotes impaired secured credit facilities that were reclassified to “Liabilities subject to compromise” on September 12, 2017

⁽²⁾	Denotes unsecured bonds that were reclassified to “Liabilities subject to compromise” on September 12, 2017


Outstanding debt as at June 30, 2018
(In $ millions)	Principal outstanding		Less: Debt Issuance Costs			Total Debt
Debt due within one year		91		(1	)		90
Long-term debt		856		—			856
Debt held as subject to compromise		7,600		—			7,600

Total		8,547		(1	)		8,546


Outstanding debt as at December 31, 2017
(In $ millions)	Principal outstanding		Less: Debt Issuance Costs			Total Debt
Debt due within one year		511		(2	)		509
Long-term debt		485		—			485
Debt held as subject to compromise		7,705		—			7,705

Total		8,701		(2	)		8,699

Outstanding Debt

The outstanding debt as at June 30, 2018 is repayable as follows:


(In $ millions)	Year ended June 30,
2019		91
2020		57
2021		68
2022		70
2023		523
2024 and thereafter		138

Total debt principal		947

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
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-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
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-Section 55
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-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21521-112644

+ Details

Common shares (Tables)

6 Months Ended

Jun. 30, 2018

Changes in Non-Controlling Interest

Share Capital


	As at June 30, 2018						As at December 31, 2017
	Shares			$ million			Shares			$ million
All shares are common shares of $2.00 par value each
Authorized share capital		800,000,000			1,600			800,000,000			1,600
Issued and fully paid share capital		508,763,020			1,017			508,763,020			1,017
Treasury shares held by the Company		(4,244,080	)		(9	)		(4,244,080	)		(9	)

Outstanding common shares in issue		504,518,940			1,008			504,518,940			1,008

Non-controlling interest (Tables)

6 Months Ended

Jun. 30, 2018

Noncontrolling Interest [Abstract]

Changes in non-controlling interest for the period ended June 30, 2018 is as follows:


(In $ millions)	Ship Finance International Ltd VIEs			North Atlantic Drilling Ltd			Asia Offshore Drilling Ltd			Sevan Drilling ASA			Seadrill Nigeria Operations Limited		Total
December 31, 2017		(59	)		76			149			226			7		399
Adoption of new accounting standard ASU 2016-16 - Income Taxes⁽¹⁾		—			(25	)		—			—			—		(25	)
Net income attributable to non-controlling interest in 2018		7			(160	)		1			(10	)		2		(160	)
Redeemable non-controlling interest⁽²⁾		—			—			(150	)		—			—		(150	)

Ending balance, June 30, 2018		(52	)		(109	)		—			216			9		64

⁽¹⁾	For further information see Note 2 “Recent accounting pronouncements”

⁽²⁾	For further information see Note 20 “Redeemable non-controlling interest”

Redeemable non-controlling interest (Tables)

6 Months Ended

Jun. 30, 2018

Temporary Equity Disclosure [Abstract]

Changes in Redeemable Non-Controlling Interest

Changes in redeemable non-controlling interest for the period ended June 30, 2018 is as follows:


(In $ millions)	Asia Offshore Drilling Ltd
As at December 31, 2017		—
Reclassification from non-controlling interest		150
Fair value adjustment on initial recognition		(127	)
Net income attributable to redeemable non-controlling interest in 2018		2

As at June 30, 2018		25

Accumulated other comprehensive income (Tables)

6 Months Ended

Jun. 30, 2018

Schedule of Accumulated Other Comprehensive Income

Accumulated other comprehensive income as at June 30, 2018 and December 31, 2017 was as follows:


(In $ millions)	Unrealized gain on marketable securities			Unrealized gain on foreign exchange		Actuarial (loss) / gain relating to pension			Share in unrealized gain from associated companies		Change in unrealized gain on interest rate swaps in VIEs		Change in conversion option on Archer debt facility		Total
Beginning balance, December 31, 2017		31			36		(26	)		15		2		—		58
Adoption of accounting standard update		(31	)		—		—			—		—		—		(31	)
Beginning balance, January 1, 2018		—			36		(26	)		15		2		—		27
Other comprehensive income before reclassifications		—			—		1			11		—		2		14

Ending balance, June 30, 2018		—			36		(25	)		26		2		2		41

Risk management and financial instruments (Tables)

6 Months Ended

Jun. 30, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Notional Amount, Fixed Interest Rate Payable

Below is a summary of the notional amount, fixed interest rate payable and duration of the outstanding principal as at June 30, 2018.

Variable interest entity

Outstanding principal as at
June 30, 2018
(In $ millions)

Receive rate

Pay rates

Length of contracts

SFL Linus Limited

(West Linus)

141

1—3 month LIBOR

1.77—2.01

%

Dec 2013—Dec 2018

Realized and Unrealized Gains and Losses

The total realized and unrealized gains and losses recognized in the Consolidated Statement of Operations relating to above derivative arrangements for the six months ended June 30, 2018 and 2017 are as follows:


(In $ millions)	Six Months Ended June 30,
*(Losses)/Gains recognized in the consolidated statement of operations relating to derivative financial instruments*		2018		2017
Interest rate swap agreements not qualified as hedge accounting		(1	)	(18	)
Cross currency interest rate swaps not qualified as hedge accounting		—		29
Foreign currency spot trades not qualified as hedge accounting		—		1
Convertible loan agreement		4		(5	)
Interest rate cap		(7	)	—

(Loss)/Gain on derivative financial instruments		(4	)	7

Carrying Value and Estimated at Fair Value of Financial Instruments

The carrying value and estimated fair value of our financial instruments as at June 30, 2018 and December 31, 2017 were as follows

Financial assets


	As at June 30, 2018				As at December 31, 2017
(In $ millions)	Fair value		Carrying value		Fair value		Carrying value
Cash and cash equivalents		809		809		1,255		1,255
Restricted cash		409		409		104		104
Derivative Asset—interest rate cap		61		61		—		—
Related party loans receivable—short term		18		18		25		25
Related party loans receivable—long term		547		535		522		515

Financial Instruments Measured at Fair Value on a Recurring Basis

Financial assets that are measured at fair value on a recurring basis:


			Fair value measurements as at the reporting date using
(In $ millions)	Total fair value As at June 30, 2018		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Marketable securities - current asset		121		121		—		—
Interest rate cap – current asset		61		—		61		—
Convertible debt instruments - non-current asset		58		—		—		58

Total assets		240		121		61		58


			Fair value measurements as at the reporting date using
(In $ millions)	Total fair value As at December 31, 2017		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Marketable securities - current asset		124		124		—		—
Convertible debt instrument - non-current asset		52		—		—		52

Total assets		176		124		—		52

Reconciliation of Convertible Debt Instrument Classified Within Level 3

The following table is a reconciliation of the convertible debt instrument classified within Level 3 of the valuation hierarchy for the periods indicated:


(In $ millions)	Total fair value (Level 3)
As at December 31, 2017		52
Change in fair valued recognized in the Statement of Operations		4
Change in fair value recognized in Other Comprehensive Income		2

As at June 30, 2018		58

Variable Interest Entities (VIEs) (Tables)

6 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Sale and Leaseback Arrangements

The following table gives a summary of the sale and leaseback arrangements, as at June 30, 2018:

Unit

Effective
from

Sale value
(In $ millions)

First
repurchase
option
(In $ millions)

Month of first
repurchase
option

Last
repurchase
option
(In $ millions)

Month of last
repurchase
Option*

West Taurus

Nov 2008

850

418

Feb 2015

149

⁽¹⁾

Nov 2023

West Hercules

Oct 2008

850

580

Aug 2011

135

⁽¹⁾

Aug 2023

West Linus

June 2013

600

370

June 2018

170

⁽²⁾

June 2028

⁽¹⁾	Purchase obligations at the end of the 15-year lease period

⁽²⁾	Ship Finance has a right to require us to purchase the West Linus rig on the 15^th anniversary for $100 million if we do not exercise the final repurchase option

Summary of Bareboat Charter Rates per Day Based on Base LIBOR Interest Rate for Next Five Years

A summary of the bareboat charter rates per day for each unit is given below.


	(In $ thousands)
Unit	2018		2019		2020		2021		2022		2023
West Taurus		112		103		101		97		96		181
West Hercules		118		101		100		96		96		184
West Linus		158		122		99		99		93		189

Assets and Liabilities in Statutory Accounts of VIEs

The assets and liabilities in the financial statements of the VIEs as at June 30, 2018 and as at December 31, 2017 are as follows:


	As at June 30, 2018						As at December 31, 2017
(In $ millions)	SFL Deepwater Limited		SFL Hercules Limited		SFL Linus Limited		SFL Deepwater Limited		SFL Hercules Limited		SFL Linus Limited
Name of unit	West Taurus		West Hercules		West Linus		West Taurus		West Hercules		West Linus
Investment in finance lease		326		316		414		335		326		431
Amount due from related parties		3		4		—		4		4		—
Other assets		6		6		7		6		6		8

Total assets of the VIEs		335		326		421		345		336		439

Short-term interest bearing debt		19		28		45		226		27		48
Long-term interest bearing debt		196		210		240		—		224		261
Other liabilities		10		10		—		3		2		—
Short-term amounts due to related parties		—		—		12		—		—		4
Long-term debt due to related parties		106		73		115		113		80		121

Total liabilities of the VIEs		331		321		412		342		333		434

Equity of the VIEs		4		5		9		3		3		5

Book value of units in the Company’s consolidated financial statements		373		525		504		385		508		515

Schedule of Related Party Transactions

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References + Details

Related party transactions (Tables)

6 Months Ended

Jun. 30, 2018

The net income/(expenses) with Seadrill Partners for the six months ended June 30, 2018 and 2017 were as follows:


(In US$ millions)	Six Months Ended June 30,
	2018			2017
Management fees charged to Seadrill Partners - Other revenues (a) and (b)		35			37
Rig operating expenses charged to Seadrill Partners - Other revenues (c)		1			13
Contingent consideration realized (d)		7			11
Interest recognized on deferred consideration receivable (d)		2			2
Insurance premiums charged to Seadrill Partners (e)		5			5
Rig operating costs charged by Seadrill Partners (f)		(1	)		(2	)
Bareboat charter arrangements (g)		—			3
Interest expenses charged to Seadrill Partners (h)		—			5
Related party inventory purchases		(3	)		(2	)
Derivatives recharged to Seadrill Partners (i)		—			1

Net related party income from Seadrill Partners		46			73

Receivables/(payables) with Seadrill Partners and its subsidiaries as at June 30, 2018 and December 31, 2017 consisted of the following:


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Rig financing and loan agreements (j)		—			25
Deferred consideration receivable (d)		41			52
Other receivables (k)		148			157
Other payables (k)		(7	)		(24	)

The following is a summary of the related party agreements with Seadrill Partners:

(a, b) Management, administrative, and technical service agreements

Income recognized under the management, administrative and technical service agreements for the six months ended June 30, 2018 were a total of $35 million (six months ended June 30, 2017: income of $37 million).

(c) Rig operating costs charged to Seadrill Partners

Seadrill has charged to Seadrill Partners certain rig operating costs in relation to costs incurred on behalf of the West Polaris operating in Angola in 2017. In 2018, the West Polaris was mobilized to Spain and therefore not subject to any further operating costs from Angola. The total other revenues earned for the six months ended June 30, 2018 were $1 million (six months ended June 30, 2017: $13 million).

(d) Deferred consideration receivable

From the disposal of the West Vela and West Polaris to Seadrill Partners in November 2014 and June 2015 respectively, we recognized deferred consideration which as at June 30, 2018 the total outstanding balance in relation to these receivables was $41 million (December 31, 2017: $52 million). Refer to Note 8—Loss on disposals and contingent consideration for more information.

(e) Insurance premiums

We negotiate insurance for drilling units on a centralized basis. The total insurance premiums related to Seadrill Partners drilling units charged to Seadrill Partners for the six months ended June 30, 2018 were $5 million (six months ended June 30, 2017: $5 million).

(f) Rig operating costs charged by Seadrill Partners

Seadrill Partners has charged to Seadrill, through its Nigerian service company, certain services, including the provision of onshore and offshore personnel, which was provided for the West Jupiter drilling rig operating in Nigeria. The total rig operating expenses incurred for the six months ended June 30, 2018 were $1 million (six months ended June 30, 2017: $2 million).

(g) Bareboat charter arrangements

In connection with the transfer of the West Aquarius operations to Canada, the West Aquarius drilling contract was assigned to Seadrill Canada Ltd., a wholly owned subsidiary of Seadrill Partners, necessitating certain changes to the related party contractual arrangements relating to the West Aquarius. Seadrill China Operations Ltd S.A.R.L., the owner of the West Aquarius and a wholly-owned subsidiary of Seadrill Partners, had previously entered into a bareboat charter arrangement with Seadrill Offshore AS, a wholly-owned subsidiary of Seadrill, providing Seadrill Offshore AS with the right to use the West Aquarius. In October 2012, this bareboat charter arrangement was replaced with a new bareboat charter between Seadrill China Operations Ltd S.A.R.L. and Seadrill Offshore AS, and at the same time, Seadrill Offshore AS entered into a bareboat charter arrangement providing Seadrill Canada Ltd. with the right to use the West Aquarius in order to perform its obligations under the drilling contract described above. The net effect to Seadrill of the bareboat charters for the six months ended June 30, 2018 was net revenue of nil (six months ended June 30, 2017: net revenue of $3 million). The contract was terminated effective April 19, 2017 on completion of the rig’s contract with Hibernia Management.

(h) Interest expenses

The total interest income charged to Seadrill Partners for the related party loan arrangements outlined below for the six months ended June 30, 2018 was nil (six months ended June 30, 2017: $5 million). Refer to the sections below for details on the financing agreements.

(i) Derivative interest rate swap agreements

We previously held interest rate swap agreements with Seadrill Partners on a back to back basis with certain of its own interest rate swap agreements. On commencement of Chapter 11 proceedings the derivative position held by Seadrill was cancelled and held at the claimed value by the derivative counterparty. This resulted in no further recharged gains or losses on derivatives after September 12, 2017. The total net derivative gains and losses charged to Seadrill Partners for the six months ended June 30, 2018 was nil (six months ended June 30, 2017: gain of $1 million).

(j) Rig financing agreements

The West Vencedor loan agreement between us and Seadrill Partners was scheduled to mature in June 2015 and all outstanding amounts thereunder would be due and payable, including a balloon payment of $70 million. On April 14, 2015 the loan agreement was amended and the maturity date was extended to June 25, 2018. The West Vencedor loan agreement bears a margin of 2.3%, a guarantee fee of 1.4% and a balloon payment of $21 million due at maturity in June 2018. The loan was repaid in full during the period ended June 30, 2018 (December 31, 2017: $25 million).

(k) Receivables and Payables

Receivables and payables with Seadrill Partners and its subsidiaries are comprised of management fees, advisory and administrative services, and other items including accrued interest. In addition, certain receivables and payables arise when we pay an invoice on behalf of Seadrill Partners or its subsidiaries and vice versa. Receivables and payables are generally settled quarterly in arrears. Trading balances to Seadrill Partners and its subsidiaries are unsecured and are intended to be settled in the ordinary course of business.

SeaMex Limited [Member]

Schedule of Related Party Transactions

Receivables/(payables) with SeaMex joint venture as at June 30, 2018 consisted of the following:


(In $ millions)	As at June 30, 2018			As at December 31, 2017
Seller’s credit		250			250
$45 million loan facility		45			45
Interest on long-term funding and seller’s credit		62			50
Other receivables		39			32
Other payables		(1	)		(3	)

Ship Finance International Ltd VIEs [Member]

Schedule of Related Party Transactions

During the six month periods ended June 30, 2018 and 2017, we incurred the following lease costs on units leased back from Ship Finance subsidiaries:


	Six Months Ended June 30,
	2018		2017
West Hercules		20		28
West Taurus		18		25
West Linus		30		41

Total		68		94

Commitments and contingencies (Tables)

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Maturity Schedule for Contractual Commitments

The table below shows the maturity schedule for the newbuilding contractual commitments as of June 30, 2018.


(In $ millions)	As at June 30, 2018
2018		1,683
2019		—
2020		—
2021		—

Total purchase commitments		1,683

Supplementary cash flow information (Tables)

6 Months Ended

Jun. 30, 2018

Supplemental Cash Flow Elements [Abstract]

Non-cash Investing and Financing Activities

The table below summarizes the non-cash investing and financing activities relating to the periods presented:


	Six Months Ended June 30,
(In $ millions)	2018		2017
*Non-cash investing activities*
Sale of rigs and equipment ⁽¹⁾		—		74
*Non-cash financing activities*
Repayment of debt following sale of rigs and equipment ⁽¹⁾		—		(74	)
Dividend to non-controlling interests in VIEs ⁽²⁾		—		(14	)

Assets held for sale (Tables)

6 Months Ended

Jun. 30, 2018

Discontinued Operations and Disposal Groups [Abstract]

Asset Held-for-sale

On May 9, 2018 the West Rigel was sold by Jurong and we received a share of proceeds totaling $126 million.


(In $ millions)	Six months ended June 30, 2018			Year ended December 31, 2017
Opening balance at the beginning of the period		126			128
Sale of West Rigel		(126	)		—
Loss on disposal		—			(2	)

Non-current assets held for sale		—			126

General Information - Additional Information (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2018 Option	Jul. 02, 2018 USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of offshore drilling units owned by the Company	35
Number of offshore drilling units under construction	8
Number of options to acquire semi-submersible rig \| Option	1
New capital		$ 1,080
Unsecured bond obligation		2,400
Unsecured interest rate and currency swaps		250
Post emergence cash		2,100
Outstanding debt principal		$ 7,600

Recent Accounting Pronouncements - Additional Information (Detail) - USD ($)	Dec. 31, 2018	Jun. 30, 2018	Jan. 01, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of new accounting principle in period of adoption		$ (31,000,000)
Accounting Standards Update 2016-02 [Member] \| Scenario, Forecast [Member] \| Minimum [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease, right-of-use asset	$ 30,000,000
Operating lease, liability	30,000,000
Accounting Standards Update 2016-02 [Member] \| Scenario, Forecast [Member] \| Maximum [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease, right-of-use asset	50,000,000
Operating lease, liability	$ 50,000,000
Accounting standards update 2014-09 \| Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of new accounting principle in period of adoption			$ 7,000,000
Accounting Standards Update 2016-01 [Member] \| Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of new accounting principle in period of adoption			31,000,000
Accounting standards update 2016-16 \| Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of new accounting principle in period of adoption			59,000,000
Accounting standards update 2016-16 \| Non-controlling Interest [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of new accounting principle in period of adoption			$ 25,000,000

Chapter 11 Proceedings - Additional Information (Detail) $ in Millions				6 Months Ended	12 Months Ended
	Jun. 15, 2018 USD ($)	Feb. 28, 2018 USD ($)	Feb. 26, 2018 USD ($)	Jun. 30, 2018 USD ($) shares	Dec. 31, 2017 USD ($) shares	Aug. 08, 2018 USD ($) shares	Sep. 12, 2017 shares
Fresh-Start Adjustment [Line Items]
Amount of new cash commitments in the form of new notes and equity			$ 1,080.0
Number of days after Confirmation Date the plan must effective by				90 days
Bankruptcy claims, unsecured claims, pro rata cash recovery pool			23.0
Plan of reorganization, equity securities issued or to be issued, ownership percentage				2.00%
Notes rights offering, maximum aggregate principal amount of new secured notes			119.4
Common shares outstanding \| shares				504,518,940	504,518,940		504,518,940
Protection payments				$ 104.0	$ 81.0
Contractual interest on liabilities subject to compromise				76.0
Bankruptcy claims, number claims filed	1,597
Bankruptcy claims, amount of claims filed	$ 19,200.0
Debtor reorganization items, claims settlement accrual					1,064.0
Loss on impairment of long lived assets				$ 414.0	$ 696.0
Employee Stock Option [Member] \| Employee Incentive Plan [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, share-based compensation arrangement, percentage of shares available for grant				10.00%
New Secured Notes [Member]
Fresh-Start Adjustment [Line Items]
Notes rights offering, pro rata equity securities issued or to be issued, ownership percentage						57.50%
Holders of General Unsecured Claims [Member]
Fresh-Start Adjustment [Line Items]
Payment for debt extinguishment			17.0
Shipyards [Member]
Fresh-Start Adjustment [Line Items]
Payment for debt extinguishment			$ 17.0
NSNCo [Member] \| New Secured Notes [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, debt securities issued or to be issued, value						$ 880.0
New Seadrill [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, percentage of equity securities issued or to be issued			15.00%	23.75%
Plan of reorganization, equity securities issued or to be issued, ownership percentage			2.00%
Notes rights offering, pro rata equity securities issued or to be issued, ownership percentage			57.50%
Notes rights offering, maximum value of common shares issued		$ 48.1
Common shares outstanding \| shares						100,000,000
Equity method investment				$ 200.0
New Seadrill [Member] \| New Secured Notes [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, percentage of equity securities issued or to be issued				54.625%
Plan of reorganization, debt securities issued or to be issued, value				$ 880.0
New Seadrill [Member] \| Structuring Fees [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, percentage of equity securities issued or to be issued				5.475%
New Seadrill [Member] \| Unsecured Claims And Debtor Affiliates [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, percentage of equity securities issued or to be issued				14.25%
New Seadrill [Member] \| Existing Common Equity Interest Holder [Member]
Fresh-Start Adjustment [Line Items]
Plan of reorganization, percentage of equity securities issued or to be issued				1.90%
Exchange ratio of common shares				0.0037345

Liabilities Subject to Compromise - Schedule of Liabilities Subject to Compromise (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	$ 9,050	$ 9,191
Senior under secured or impaired external debt [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	5,266	5,371
Senior Unsecured Bonds [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	2,334	2,334
New build global settlement agreement [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	1,064	1,064
Derivative [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	249	249
Accounts Payable And Other Liabilities [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	84	103
Accrued Interest On Notes Payable [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	49	50
Related Party Debt [Member]
Fresh-Start Adjustment [Line Items]
Liabilities subject to compromise	$ 4	$ 20

Segment Information - Additional Information (Detail)	6 Months Ended
Segment Information - Additional Information (Detail)	Jun. 30, 2018 Segment
Segment Reporting Information [Line Items]
Number of operating segments	3
Sales Revenue, Net [Member] \| Customer Concentration Risk [Member]
Segment Reporting Information [Line Items]
Concentration risk percentage	10.00%

Segment Information - Segment Results (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Drilling units and new buildings	$ 12,780		$ 13,464
Operating Revenue	712	$ 1,146
Depreciation and amortization	391	406
Operating loss	(613)	(17)
Drilling unit and new buildings capital expenditure	117	66
Unallocated items:
Assets held for sale			126
Total financial items and other	14	(96)
Investments in associated companies	1,615		1,473
Income taxes	(36)	12
Marketable securities	121		124
Net loss	(635)	(101)
Cash and restricted cash	1,218	1,441	1,359	$ 1,443
Other assets	1,311		1,436
Total assets	17,045		17,982
Floaters [Member]
Segment Reporting Information [Line Items]
Drilling units and new buildings	9,411		9,956
Operating Revenue	482	744
Depreciation and amortization	298	301
Operating loss	(446)	95
Drilling unit and new buildings capital expenditure	93	54
Jack Ups [Member]
Segment Reporting Information [Line Items]
Drilling units and new buildings	3,369		$ 3,508
Operating Revenue	193	360
Depreciation and amortization	93	105
Operating loss	(167)	(115)
Drilling unit and new buildings capital expenditure	24	12
Other Drilling Units [Member]
Segment Reporting Information [Line Items]
Operating Revenue	$ 37	42
Operating loss		$ 3

Segment Information - Summary of Geographic Segment Data (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 712	$ 1,146
Brazil [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	188	197
NORWAY
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	82	115
UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	30	187
Others [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	128	208
NIGERIA [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	105	110
ANGOLA
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	100	249
SAUDI ARABIA
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	79	$ 80
Drilling Unit [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	12,531		$ 13,216
Drilling Unit [Member] \| Brazil [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	2,405		1,816
Drilling Unit [Member] \| NORWAY
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	2,331		2,258
Drilling Unit [Member] \| MALAYSIA
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	1,445		1,809
Drilling Unit [Member] \| SPAIN
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	1,344		2,016
Drilling Unit [Member] \| UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	1,239		1,266
Drilling Unit [Member] \| Others [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Fixed assets	$ 3,767		$ 4,051

Segment Information - Summary of Geographic Segment Data (Parenthetical) (Detail) - Geographic Concentration Risk [Member] - Maximum [Member]	6 Months Ended
	Jun. 30, 2018
Net Assets, Geographic Area [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration risk percentage	10.00%
Sales Revenue, Net [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Concentration risk percentage	10.00%

Segment Information - Summary of Major Customers (Detail) - Sales Revenue, Net [Member] - Customer Concentration Risk [Member]	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Revenue, Major Customer [Line Items]
Customers with contract revenue	10.00%
Petroleo Brasileiro Sa [Member]
Revenue, Major Customer [Line Items]
Customers with contract revenue	27.00%	17.00%
SA Group [Member]
Revenue, Major Customer [Line Items]
Customers with contract revenue	20.00%	22.00%
Saudi Aramco [Member]
Revenue, Major Customer [Line Items]
Customers with contract revenue	12.00%	8.00%
Exxon Mobil Corporation [Member]
Revenue, Major Customer [Line Items]
Customers with contract revenue	11.00%	7.00%
L L O G [Member]
Revenue, Major Customer [Line Items]
Customers with contract revenue	5.00%	18.00%

Revenue from Contracts with Customers - Schedule of Information about Receivables, Contract Assets and Contract Liabilities from Contracts with Customers (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jan. 01, 2018	Dec. 31, 2017
Change in Contract with Customer, Asset and Liability [Abstract]
Accounts receivable, net	$ 272	$ 295	$ 295
Current contract assets	9	7
Current contract liabilities (deferred revenue)	(25)	(37)
Non-current contract liabilities (deferred revenue)	(7)	$ (18)
Contract assets,beginning balance	7
Contract liabilities,beginning balance	(55)
Net contract liability,beginning balance	(48)
Decrease due to amortization of revenue that was included in the beginning contract liability balance	25
Increase due to cash received, excluding amounts recognized as revenue	(9)
Decrease due to recognized during the period but contingent on future performance	9
Net contract liability,ending balance	(23)
Contract assets,ending balance	9
Contract liabilities,ending balance	$ (32)

Revenue from Contracts with Customers - Additional Information (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2018 USD ($)
Revenue From Contract With Customers [Line Items]
Amortization of deferred contract costs	$ 15
Other Current Assets [Member]
Revenue From Contract With Customers [Line Items]
Deferred contract costs	9
Other Noncurrent Assets [Member]
Revenue From Contract With Customers [Line Items]
Deferred contract costs	$ 2

Revenue from Contracts with Customers - Summary of Revenue Expected to be Recognized in Future Related to Performance Unsatisfied Obligations (Detail) $ in Millions	Jun. 30, 2018 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	$ (32)
July One Two Thousand Eighteen [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(13)
July One Two Thousand Nineteen [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(19)
Deferred Revenue [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(29)
Deferred Revenue [Member] \| July One Two Thousand Eighteen [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(11)
Deferred Revenue [Member] \| July One Two Thousand Nineteen [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(18)
Other Deferred Revenue [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(3)
Other Deferred Revenue [Member] \| July One Two Thousand Eighteen [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	(2)
Other Deferred Revenue [Member] \| July One Two Thousand Nineteen [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue remaining performance obligation	$ (1)

Reorganization Items - Schedule of Reorganization Items (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2018 USD ($)
Reorganizations [Abstract]
Advisory and professional fees	$ (115)
Interest income on surplus cash invested	6
Total reorganization items	$ (109)

Loss on Disposals and Contingent Consideration - Summary of Loss on Disposals and Contingent Consideration (Detail) - USD ($) $ in Millions	6 Months Ended		36 Months Ended	44 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on disposals		$ (166)
Contingent consideration realized	$ 7	11
West Triton [Member] \| Drilling Unit [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on disposals		(34)
West Resolute [Member] \| Drilling Unit [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on disposals		(61)
West Mischief [Member] \| Drilling Unit [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on disposals		(71)
West Polaris [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Contingent consideration realized			$ 53
West Polaris [Member] \| Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Contingent consideration realized		4
West Vela [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Contingent consideration realized				$ 45
West Vela [Member] \| Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Contingent consideration realized	$ 7	$ 7

Loss on Disposals and Contingent Consideration - Additional Information (Detail) - USD ($)		6 Months Ended		36 Months Ended	44 Months Ended
	Apr. 29, 2017	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2018	Jun. 19, 2015	Nov. 04, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on disposals			$ (166,000,000)
Contingent consideration realized		$ 7,000,000	$ 11,000,000
Seadrill Operating LP [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Ownership interest (as percent)						42.00%
Contingent consideration arrangements, description		In relation to the sale, we may be entitled to receive a contingent consideration from Seadrill Partners, consisting of (a) any day rates earned by Seadrill Partners in excess of $450,000 per day, adjusted for daily utilization, tax and agency commission for the remainder of the ExxonMobil contract, which completed in December 2017 and (b) 50% of any day rate earned above $450,000 per day, adjusted for daily utilization, tax and agency commission fee after December 2017 until 2025.
Amount to be paid under contingent consideration arrangements, value, low		$ 450,000		$ 450,000	$ 450,000
West Triton West Mischief and West Resolute [Member] \| Drilling Unit [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Fair value of consideration received	$ 225,000,000
Loss on disposals	$ (166,000,000)
West Polaris [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Contingent consideration realized				$ 53,000,000
West Vela [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Ownership interest (as percent)							49.00%
Contingent consideration realized					$ 45,000,000
West Vela [Member] \| Maximum [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Fair value of consideration received							$ 40,000

Taxation - Additional Information (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Transactions with Third Party [Line Items]
Increase in income tax expense	$ 48
Tax expense	18
Income tax expense (benefit)	36	$ (12)
Increase in uncertain tax position	8
Secretariat of the Federal Revenue Bureau of Brazil [Member]
Transactions with Third Party [Line Items]
Income tax examination, estimate of possible loss	161
Nigerian tax authorities [member]
Transactions with Third Party [Line Items]
Income tax examination, estimate of possible loss	$ 171

Earnings Per Share - Summary of Earnings Per Share (Detail) - USD ($) $ / shares in Units, $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Earnings Per Share [Abstract]
Net loss	$ (477)	$ (78)
Less: Allocation to participating securities	0	0
Net loss available to shareholders	(477)	(78)
Effect of dilution	0	0
Diluted net loss available to shareholders	$ (477)	$ (78)
Basic earnings per share:
Weighted average number of common shares outstanding	504,000,000	504,000,000
Diluted earnings per share:
Weighted average number of common shares outstanding	504,000,000	504,000,000
Effect of dilutive share options	0	0
Effect of dilutive convertible bonds	0	0
Weighted average number of common shares outstanding adjusted for the effects of dilution	504,000,000	504,000,000
Basic (loss)/income per share (US dollar)	$ (0.95)	$ (0.16)
Diluted (loss)/income per share (US dollar)	$ (0.95)	$ (0.16)

Earnings Per Share - Additional Information (Detail)	6 Months Ended
Earnings Per Share - Additional Information (Detail)	Jun. 30, 2018
Earnings Per Share [Abstract]
Plan of reorganization, equity securities issued or to be issued, ownership percentage	2.00%

Cash and Cash Equivalents (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017	Dec. 31, 2016
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 809	$ 1,255
Restricted cash	409	104
Total	$ 1,218	$ 1,359	$ 1,441	$ 1,443

Marketable Securities - Additional Information (Detail) $ in Millions	Jun. 30, 2018 USD ($)
Accounting Standards Update 2016-01 [Member]
Gain (Loss) on Investments [Line Items]
Reclassification of previously recognized fair value gains from accumulated other comprehensive income to retained earnings	$ 31

Marketable Securities - Marketable Securities In The Consolidated Balance Sheet (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Marketable Securities [Line Items]
Total marketable securities	$ 121	$ 124
Seadrill Partners Common Units [Member]
Marketable Securities [Line Items]
Total marketable securities	91	96
Archer [Member]
Marketable Securities [Line Items]
Total marketable securities	$ 30	$ 28

Marketable Securities - Net Unrealized Gains and Losses for Consolidated Statement of Operations (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Marketable Securities [Line Items]
Total unrealized (loss) / gain on marketable securities	$ (3)	$ 6
Seadrill Partners Common Units [Member]
Marketable Securities [Line Items]
Total unrealized (loss) / gain on marketable securities	(5)	(21)
Archer [Member]
Marketable Securities [Line Items]
Total unrealized (loss) / gain on marketable securities	$ 2	$ 27

Accounts Receivable - Additional Information (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Accounts Receivable, Net, Current [Abstract]
Allowance for doubtful accounts receivables	$ 83,000,000		$ 35,000,000
Bad debt expense	$ 48,000,000	$ 0

Investment in Associated Companies - Investments Either Recorded Using Equity Method or At Cost Less Impairment (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Schedule of Investments [Line Items]
Total investment in associated companies	$ 1,615	$ 1,473
Seabras Sapura Participacoes Sa [Member]
Schedule of Investments [Line Items]
Equity method investments	76	63
Seabras Sapura Hold Co Ltd [Member]
Schedule of Investments [Line Items]
Equity method investments	334	290
SeaMex Limited [Member]
Schedule of Investments [Line Items]
Equity method investments	107	102
Direct Ownership Interest [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Equity method investments	914	857
Subordinated Units [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Equity method investments	120	97
Member Interest and Incentive Distribution Rights [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Cost method investments	$ 64	$ 64

Investment In Associated Companies - Additional Information (Detail) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Equity method investment other than temporary impairment	$ 0
Remaining economic lives of underlying assets	30 years
Weighted average cost of capital	9.75%
Total Cost method investments other than temporary impairment	$ 0
SeaMex Limited [Member]
Schedule of Investments [Line Items]
Equity method investment other than temporary impairment	$ 0	$ 36,000,000
Remaining economic lives of underlying assets	30 years
Weighted average cost of capital	10.25%
Ownership interest	50.00%
Direct Ownership Interest [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Equity method investment other than temporary impairment		82,000,000
Subordinated Units [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Equity method investment other than temporary impairment		$ 723,000,000
Non Economic Interest [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Ownership interest	0.00%
Incentive Distribution Rights [Member] \| Seadrill Partners LLC [Member]
Schedule of Investments [Line Items]
Ownership interest	100.00%

Newbuildings - Summary Of Newbuildings (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Total Newbuildings	$ 249	$ 248
Newbuildings [Member]
Property, Plant and Equipment [Line Items]
Total Newbuildings	$ 249	$ 248

Drilling Units - Summary Of Net Book Value (Detail) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Impairment	$ (414)	$ (696)
Net book value	12,780	13,464
Drilling Unit [Member]
Property, Plant and Equipment [Line Items]
Cost	17,452	17,335
Accumulated depreciation	(4,507)	(4,119)
Impairment	(414)
Net book value	$ 12,531	$ 13,216

Drilling Units - Additional Information (Detail) - USD ($) $ in Millions	6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Impairment of long-lived assets	$ 414		$ 696
Drilling Unit [Member]
Property, Plant and Equipment [Line Items]
Depreciation expense	388	$ 392
Impairment of long-lived assets	$ 414
Weighted average cost of capital	11.40%
Equipment [Member]
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 3	$ 14

Debt - Schedule of Debt (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Debt and Financial Instruments [Line Items]
Total debt principal	$ 8,547	$ 8,701
Less: Debt balance held as subject to compromise	(7,600)	(7,705)
Total debt not subject to compromise	947	996
Total debt not subject to compromise	947	996
Less: current portion of debt principal	(91)	(511)
Long-term portion of debt principal	856	485
Credit Facility Ship Finance International Loans 375 Facility [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	237	251
Credit Facility Ship Finance International Loans 390 Facility [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	215	226
Credit Facility Ship Finance International Loans 475 Facility [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	285	309
Credit Facility Ship Finance International Loans Total [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	737	786
Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	5,476	5,581
Secured Debt [Member] \| Credit Facility US 2000 North Atlantic Drilling [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	880	897
Secured Debt [Member] \| Credit Facility US 400 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	130	133
Secured Debt [Member] \| Credit Facility US 440 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	60	62
Secured Debt [Member] \| Credit Facility US 1450 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	311	318
Secured Debt [Member] \| Credit facility US 360 Asia Off shore Drilling [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	210	210
Secured Debt [Member] \| Credit Facility US300 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	140	142
Secured Debt [Member] \| Credit FacilityUS1750 Sevan Drilling [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	835	856
Secured Debt [Member] \| Credit Facility US450 Eminence [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	255	261
Secured Debt [Member] \| Credit Facility US 1500 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	1,095	1,112
Secured Debt [Member] \| Credit Facility US 1350 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	913	931
Secured Debt [Member] \| Credit Facility US 950 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	549	558
Secured Debt [Member] \| Credit Facility US 450 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	98	101
Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Less: Debt balance held as subject to compromise	(5,300)	(5,400)
Unsecured Debt [Member] \| Floating Interest Rate Bonds [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	231	231
Unsecured Debt [Member] \| Fixed Interest Rate Bonds1 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	843	843
Unsecured Debt [Member] \| US 500 Million Fixed Interest Bond [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	479	479
Unsecured Debt [Member] \| NOK 1500 Million Floating Interest Rate Bond [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	182	182
Unsecured Debt [Member] \| US600 Million Senior Unsecured Bond [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	413	413
Unsecured Debt [Member] \| SEK1 500 Million Senior Unsecured Bond [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	186	186
Unsecured Debt [Member] \| Total Bonds [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	$ 2,334	$ 2,334

Debt - Schedule of Debt (Parenthetical) (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017	Apr. 30, 2013
Credit Facility US 2000 North Atlantic Drilling [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	$ 2,000	$ 2,000
Credit Facility US 400 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	400	400
Credit Facility US 440 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	440	440
Credit Facility US 1450 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	1,450	1,450
Credit facility US 360 Asia Off shore Drilling [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	360	360	$ 360
Credit Facility US300 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	300	300
Credit FacilityUS1750 Sevan Drilling [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	1,750	1,750
Credit Facility US450 Eminence [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	450	450
Credit Facility US 1500 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	1,500	1,500
Credit Facility US 1350 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	1,350	1,350
Credit Facility US 950 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	950	950
Credit Facility US 450 [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	450	450
Credit Facility Ship Finance International Loans 375 Facility [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	375	375
Credit Facility Ship Finance International Loans 390 Facility [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	390	390
Credit Facility Ship Finance International Loans 475 Facility [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	475	475
Floating Interest Rate Bonds [Member] \| Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	800	800
Fixed Interest Rate Bonds1 [Member] \| Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	1,000	1,000
US 500 Million Fixed Interest Bond [Member] \| Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	500	500
NOK 1500 Million Floating Interest Rate Bond [Member] \| Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	1,500	1,500
US600 Million Senior Unsecured Bond [Member] \| Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	600	600
SEK1 500 Million Senior Unsecured Bond [Member] \| Unsecured Debt [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount	$ 1,500	$ 1,500

Debt - Additional Information (Detail) $ in Millions		1 Months Ended		6 Months Ended
Debt - Additional Information (Detail) $ in Millions	Jul. 02, 2018 USD ($)	May 31, 2013 USD ($) Facility	Apr. 30, 2013 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2017 USD ($)	Oct. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Apr. 26, 2017 USD ($)
Debt and Financial Instruments [Line Items]
Protection payment				$ 185
Total debt principal				$ 8,547			$ 8,701
Debt service coverage ratio				1
Credit Facility Ship Finance International Loans 375 Facility [Member]
Debt and Financial Instruments [Line Items]
Total debt principal				$ 237			251
Debt, face amount				375			375
Credit Facility Ship Finance International Loans 390 Facility [Member]
Debt and Financial Instruments [Line Items]
Total debt principal				215			226
Debt, face amount				390			390
Credit Facility Ship Finance International Loans 475 Facility [Member]
Debt and Financial Instruments [Line Items]
Total debt principal				285			309
Debt, face amount				475			475
Credit Facility [Member]
Debt and Financial Instruments [Line Items]
Debt covenant, cash and cash equivalents				400
Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Total debt principal				5,476			5,581
Number of facilities \| Facility		3
Secured Debt [Member] \| Credit facility US 360 Asia Off shore Drilling [Member]
Debt and Financial Instruments [Line Items]
Total debt principal				210			210
Debt, face amount			$ 360	360			$ 360
Debt instrument term			5 years
Secured Debt [Member] \| SFL Hercules Limited [Member] \| Credit Facility Ship Finance International Loans 375 Facility [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount		$ 375
Secured Debt [Member] \| SFL Deepwater Limited [Member] \| Credit Facility Ship Finance International Loans 390 Facility [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount						$ 390
Secured Debt [Member] \| SFL Linus Limited [Member] \| Credit Facility Ship Finance International Loans 475 Facility [Member]
Debt and Financial Instruments [Line Items]
Debt, face amount						$ 475
Secured Debt [Member] \| Ship Finance International Limited [Member] \| Long-term Debt [Member]
Debt and Financial Instruments [Line Items]
Reclassification of long-term debt				200
Archer [Member]
Debt and Financial Instruments [Line Items]
Subordinated loan					$ 37			$ 37
Loans payable					45			45
Loans payable fair value					56			$ 56
Net gain on debt extinguishment				19	$ 19
Minimum [Member] \| Credit Facility [Member]
Debt and Financial Instruments [Line Items]
Debt covenant, cash and cash equivalents				$ 525
Maximum [Member] \| Secured Debt [Member]
Debt and Financial Instruments [Line Items]
Permitted leverage ratio for period one				4.5
Permitted leverage ratio for period two				4.2
Permitted leverage ratio for period three				3.9
Permitted leverage ratio for period four				3.7
LIBOR [Member] \| Secured Debt [Member] \| Credit facility US 360 Asia Off shore Drilling [Member]
Debt and Financial Instruments [Line Items]
Basis spread on variable rate			2.75%
Subsequent Event [Member] \| Senior Secured Notes Due in 2025 [Member]
Debt and Financial Instruments [Line Items]
Total debt principal	$ 880
Interest rate	12.00%
Cash interest	4.00%
Interest payable in kind	8.00%
Debt, face amount	$ 880

Debt - Schedule of Debt Issuance Costs Against Current and Long-Term Debt (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Principal outstanding
Principal outstanding, current portion of long-term debt	$ 91	$ 511
Principal outstanding, noncurrent portion	856	485
Debt held as subject to compromise	7,600	7,705
Total	8,547	8,701
Debt issuance costs
Debt issuance costs, current portion of long-term debt	(1)	(2)
Debt issuance costs, noncurrent portion	0	0
Debt issuance costs, Debt held as subject to compromise	0	0
Debt issuance costs, gross	(1)	(2)
Total debt
Total debt, current portion	90	509
Total debt, noncurrent portion	856	485
Total debt, Debt held as subject to compromise	7,600	7,705
Total	$ 8,546	$ 8,699

Debt - Outstanding Debt (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Debt Disclosure [Abstract]
2019	$ 91
2020	57
2021	68
2022	70
2023	523
2024 and thereafter	138
Total debt not subject to compromise	$ 947	$ 996

Common Shares - Share Capital (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017	Sep. 12, 2017	May 10, 2005
Equity [Abstract]
Authorized share capital	800,000,000	800,000,000
Issued and fully paid share capital	508,763,020	508,763,020		6,000
Treasury shares held by the Company	(4,244,080)	(4,244,080)
Outstanding common shares in issue	504,518,940	504,518,940	504,518,940
Authorized share capital	$ 1,600	$ 1,600
Issued and fully paid share capital	1,017	1,017
Treasury shares held by the Company	(9)	(9)
Outstanding common shares in issue	$ 1,008	$ 1,008

Common Shares - Share Capital (Parenthetical) (Detail) - $ / shares	Jun. 30, 2018	Dec. 31, 2017	May 10, 2005
Equity [Abstract]
Common shares, par value	$ 2.00	$ 2.00	$ 2.00

Common Shares - Additional Information (Detail) - USD ($)	Jul. 02, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 12, 2017	May 10, 2005
Class of Stock [Line Items]
Common stock, shares issued		508,763,020	508,763,020		6,000
Common shares, par value		$ 2.00	$ 2.00		$ 2.00
Treasury shares held by Company		4,244,080	4,244,080
Outstanding shares in issue		504,518,940	504,518,940	504,518,940
Dividends payable				$ 0
Subsequent Event [Member]
Class of Stock [Line Items]
Common share issued	100,000,000

Non-controlling Interest - Changes in Non-controlling Interest (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Noncontrolling Interest [Line Items]
Beginning balance	$ 399
Net income attributable to non-controlling interest in 2018	(160)	$ (23)
Ending balance	64
Ship Finance International Ltd VIEs [Member]
Noncontrolling Interest [Line Items]
Beginning balance	(59)
Net income attributable to non-controlling interest in 2018	7
Ending balance	(52)
North Atlantic Drilling Ltd [Member]
Noncontrolling Interest [Line Items]
Beginning balance	76
Net income attributable to non-controlling interest in 2018	(160)
Ending balance	(109)
Asia Offshore Drilling [Member]
Noncontrolling Interest [Line Items]
Beginning balance	149
Net income attributable to non-controlling interest in 2018	1
Redeemable non-controlling interest	(150)
Sevan Drilling Asa [Member]
Noncontrolling Interest [Line Items]
Beginning balance	226
Net income attributable to non-controlling interest in 2018	(10)
Ending balance	216
Seadrill Nigeria Operations Limited [Member]
Noncontrolling Interest [Line Items]
Beginning balance	7
Net income attributable to non-controlling interest in 2018	2
Ending balance	9
Accounting standards update 2016-16
Noncontrolling Interest [Line Items]
Adoption of new accounting standard ASU 2016-16 - Income Taxes	(84)
Accounting standards update 2016-16 \| North Atlantic Drilling Ltd [Member]
Noncontrolling Interest [Line Items]
Adoption of new accounting standard ASU 2016-16 - Income Taxes	(25)
Non-controlling Interest [Member]
Noncontrolling Interest [Line Items]
Beginning balance	399
Net income attributable to non-controlling interest in 2018	(160)
Redeemable non-controlling interest	(150)
Ending balance	64
Non-controlling Interest [Member] \| Accounting standards update 2016-16
Noncontrolling Interest [Line Items]
Adoption of new accounting standard ASU 2016-16 - Income Taxes	$ (25)

Redeemable Non-controlling Interest - Changes in Redeemable Non-Controlling Interest (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2018 USD ($)
Redeemable Non-controlling Interest [Line Items]
Reclassification from non-controlling interest	$ (150)
Fair value adjustment on initial recognition	127
Net income attributable to redeemable non-controlling interest in 2018	(2)
Ending balance	25
Asia Offshore Drilling [Member]
Redeemable Non-controlling Interest [Line Items]
Beginning balance	0
Reclassification from non-controlling interest	150
Fair value adjustment on initial recognition	(127)
Net income attributable to redeemable non-controlling interest in 2018	2
Ending balance	$ 25

Redeemable Non-controlling Interest - Additional Information (Detail) - USD ($) $ in Millions		6 Months Ended
	Apr. 04, 2018	Jun. 30, 2018
Redeemable Non-controlling Interest [Line Items]
Reclassification from non-controlling interest		$ 150
Net income attributable to redeemable non-controlling interest		2
Fair value adjustment of redeemable non-controlling interest		127
Redeemable non-controlling interest		25
Non-controlling Interest [Member]
Redeemable Non-controlling Interest [Line Items]
Reclassification from non-controlling interest	$ 150	$ 150

Accumulated Other Comprehensive Income - Schedule of Accumulated Other Comprehensive Income (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2018 USD ($)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ 58
Adoption of accounting standard update	(31)
Beginning balance, adjusted	27
Other comprehensive income before reclassifications	14
Ending balance	41
Accumulated Net Investment Gain (Loss) Attributable to Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	31
Adoption of accounting standard update	(31)
Accumulated Foreign Currency Adjustment Attributable to Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	36
Beginning balance, adjusted	36
Ending balance	36
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(26)
Beginning balance, adjusted	(26)
Other comprehensive income before reclassifications	1
Ending balance	(25)
Accumulated Other Comprehensive Income Loss Unrealized Gains Losses From Investments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	15
Beginning balance, adjusted	15
Other comprehensive income before reclassifications	11
Ending balance	26
Accumulated other comprehensive income loss change in unrealized gain on derivative in VIEs [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	2
Beginning balance, adjusted	2
Ending balance	2
Accumulated Other Comprehensive Income Loss Change In Conversion Option On Debt Facility [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Other comprehensive income before reclassifications	2
Ending balance	$ 2

Accumulated Other Comprehensive Income - Additional Information (Detail) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Accumulated Other Comprehensive Income (Loss) [Line Items]
Other comprehensive income taxes	$ 0
Actuarial gain related to pension, tax effect	400,000	$ 600,000
Accounting Standards Update 2016-01 [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amounts reclassified from accumulated other comprehensive income	$ 31,000,000

Risk Management and Financial Instruments - Additional Information (Detail) - USD ($)		6 Months Ended
	May 11, 2018	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Apr. 26, 2017	Mar. 31, 2016
Derivative [Line Items]
Derivatives previously recorded at fair value		$ 249,000,000			$ 249,000,000
Interest rate contracts not designated as instrument hedging		0	$ 18,000,000
Loss/gain on derivative financial instruments		(4,000,000)	7,000,000
Total debt principal		7,600,000,000			7,705,000,000
Archer [Member]
Derivative [Line Items]
Subordinated loan			37,000,000			$ 37,000,000
Loans payable			45,000,000			45,000,000
Loans payable fair value			56,000,000			$ 56,000,000
Net gain on extinguishment of subordinated debt		19,000,000	19,000,000
Fair value of the convertible debt instrument		58,000,000
Gain on the debt component		2,000,000
Gain on the embedded conversion option		4,000,000
Archer [Member] \| Debt [Member]
Derivative [Line Items]
Fair value of the convertible debt instrument		46,000,000
Unsecured Debt [Member]
Derivative [Line Items]
Total debt principal		5,300,000,000			5,400,000,000
Carrying Value [Member]
Derivative [Line Items]
Long-term floating rate debt (including the current portion)		6,200,000,000			6,400,000,000
Fixed interest bonds, fair value disclosures, noncurrent		1,700,000,000		$ 1,700,000,000
Floating interest bonds - long term		600,000,000		600,000,000
Related party fixed rate debt - long term		314,000,000		314,000,000
Fair Value [Member]
Derivative [Line Items]
Related party fixed rate debt - long term		$ 219,000,000		$ 218,000,000
Ship Finance Variable Interest Entities [Member]
Derivative [Line Items]
Weighted average cost of capital		11.00%
Interest Rate Swap [Member]
Derivative [Line Items]
Derivatives previously recorded at fair value		$ 39,000,000			39,000,000
Interest rate contracts not designated as instrument hedging		(1,000,000)	(18,000,000)
Interest Rate Swap [Member] \| Variable Interest Entity, Primary Beneficiary [Member]
Derivative [Line Items]
Gross liability					1,000,000
Other comprehensive income, unrealized gain (loss) on interest rate swaps in VIEs		300,000	1,000,000
Net gain (loss) on fair value hedge ineffectiveness		0	0
Interest rate swap cash settlement		100,000	600,000
Interest Rate Swap [Member] \| Other Noncurrent Assets [Member] \| Variable Interest Entity, Primary Beneficiary [Member]
Derivative [Line Items]
Derivative asset		$ 400,000
Interest Rate Swap [Member] \| Minimum [Member]
Derivative [Line Items]
Derivative maturity date		Nov. 02, 2017
Derivative, fixed interest rate		0.74%
Interest Rate Swap [Member] \| Maximum [Member]
Derivative [Line Items]
Derivative maturity date		Jan. 29, 2027
Derivative, fixed interest rate		3.34%
Interest Rate Swap 2 [Member]
Derivative [Line Items]
Derivative, fixed interest rate							2.12%
Cross Currency Interest Rate Swaps [Member]
Derivative [Line Items]
Derivatives previously recorded at fair value		$ 210,000,000			$ 210,000,000
Interest rate contracts not designated as instrument hedging		$ 0	29,000,000
Cross Currency Interest Rate Swaps [Member] \| Minimum [Member]
Derivative [Line Items]
Derivative maturity date		Mar. 01, 2018
Derivative, fixed interest rate		4.94%
Cross Currency Interest Rate Swaps [Member] \| Maximum [Member]
Derivative [Line Items]
Derivative maturity date		Mar. 01, 2019
Derivative, fixed interest rate		6.18%
Interest Rate Cap [Member]
Derivative [Line Items]
Derivative maturity date	Jun. 15, 2019
Derivative notional amount	$ 68,000,000	$ 4,500,000,000
Derivative inception date	Jun. 15, 2019
Fair value of derivative financial instrument		61,000,000
Loss/gain on derivative financial instruments		(7,000,000)
Interest Rate Cap [Member] \| LIBOR [Member]
Derivative [Line Items]
Derivative variable interest rate	2.87%
Interest Rate Cap [Member] \| Carrying Value [Member]
Derivative [Line Items]
Derivative asset		61,000,000
Interest Rate Cap [Member] \| Fair Value [Member]
Derivative [Line Items]
Derivative asset		61,000,000
Foreign Currency Forwards [Member]
Derivative [Line Items]
Interest rate contracts not designated as instrument hedging		0	$ 1,000,000
Embedded Derivative Option [Member] \| Archer [Member]
Derivative [Line Items]
Fair value of the convertible debt instrument		$ 12,000,000

Risk Management And Financial Instruments - Variable Interest Entities (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2018 USD ($)
Derivative [Line Items]
Outstanding principal	$ 141
Interest Rate Swap [Member] \| Minimum [Member]
Derivative [Line Items]
Pay rates	0.74%
Interest Rate Swap [Member] \| Maximum [Member]
Derivative [Line Items]
Pay rates	3.34%
Derivative Instrument Maturity Date [Member] \| Interest Rate Swap [Member] \| Variable Interest Entity, Primary Beneficiary [Member] \| Minimum [Member]
Derivative [Line Items]
Pay rates	177.00%
Length of contracts	2013-12
Derivative Instrument Maturity Date [Member] \| Interest Rate Swap [Member] \| Variable Interest Entity, Primary Beneficiary [Member] \| Maximum [Member]
Derivative [Line Items]
Pay rates	201.00%
Length of contracts	2018-12

Risk Management And Financial Instruments - Realized and Unrealized Gains and Losses Recognized In Consolidated Statement of Operations (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Derivative Instruments, Gain (Loss) [Line Items]
Interest rate contracts not designated as instrument hedging	$ 0	$ 18,000,000
Gain / (loss) on derivative financial instruments	(4,000,000)	7,000,000
Interest Rate Swap [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Interest rate contracts not designated as instrument hedging	(1,000,000)	(18,000,000)
Cross Currency Interest Rate Swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Interest rate contracts not designated as instrument hedging	0	29,000,000
Foreign Currency Forwards [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Interest rate contracts not designated as instrument hedging	0	1,000,000
Interest Rate Cap [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain / (loss) on derivative financial instruments	(7,000,000)
Convertible Loan Agreement [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain / (loss) on derivative financial instruments	$ 4,000,000	$ (5,000,000)

Risk Management and Financial Instruments - Carrying Value and Estimated at Fair Value of Financial Instruments (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	$ 809	$ 1,255
Restricted cash	409	104
Related party loans receivable-short term	18	25
Related party loans receivable-long term	547	522
Fair Value [Member] \| Interest Rate Cap [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative Asset-interest rate cap	61
Carrying Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	809	1,255
Restricted cash	409	104
Related party loans receivable-short term	18	25
Related party loans receivable-long term	535	$ 515
Carrying Value [Member] \| Interest Rate Cap [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative Asset-interest rate cap	$ 61

Risk Management and Financial Instruments - Financial Instruments Measured at Fair Value on a Recurring Basis (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities-current asset	$ 121	$ 124
Interest rate cap - current asset	61
Convertible debt instrument-non-current asset	58	52
Total assets	240	176
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] \| Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities-current asset	121	124
Total assets	121	124
Fair Value Measurements as at the Reporting Date Using Significant Other Observable Inputs (Level 2) [Member] \| Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate cap - current asset	61
Total assets	61
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Convertible debt instrument-non-current asset	58	52
Significant Unobservable Inputs (Level 3) [Member] \| Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Convertible debt instrument-non-current asset	58	52
Total assets	$ 58	$ 52