SEADRILL LTD, 6-K filed on 8/20/2021
Report of Foreign Issuer
v3.21.2
Cover
 6 Months Ended
Jun. 30, 2021
Cover [Abstract]  
Document Type 6-K
Entity Registrant Name SEADRILL LIMITED
Entity Central Index Key 0001737706
Current Fiscal Year End Date --12-31
Document Fiscal Year Focus 2021
Document Fiscal Period Focus Q2
Amendment Flag false
Document Period End Date Jun. 30, 2021
v3.21.2
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Operating revenues    
Contract revenues $ 335 $ 392
Management contract revenues [1] 88 178
Total operating revenues 452 598
Operating expenses    
Management contract expenses [1] (115) (208)
Depreciation (83) (182)
Selling, general and administrative expenses (36) (37)
Total operating expenses (566) (748)
Other operating items    
Loss on impairment of long-lived assets (152) (1,230)
Gain on sale of assets 11 0
Other operating income [1] 3 8
Total other operating items (138) (1,222)
Operating loss (252) (1,372)
Financial and other non-operating items    
Interest income [1] 12 20
Interest expense (112) (200)
Loss on impairment of investments 0 (47)
Share in results from associated companies (net of tax) 2 (66)
Gain/(loss) on derivative financial instruments 5 (1)
Foreign exchange gain/(loss) 9 (24)
Impairment of convertible bond from related party [1] 0 (29)
Unrealized gain/(loss) on marketable securities 5 (6)
Other financial items [1] (33) (21)
Reorganization Items (230) 0
Total financial and other non-operating items, net (342) (374)
Loss before income taxes (594) (1,746)
Income tax expense (11) (2)
Net loss (605) (1,748)
Net loss attributable to the shareholder (605) (1,745)
Net loss attributable to the non-controlling interest 0 (2)
Net loss attributable to the redeemable non-controlling interest $ 0 $ (1)
Basic loss per share (in dollars per share) $ (6.03) $ (17.40)
Diluted loss per share (in dollars per share) $ (6.03) $ (17.40)
Reimbursable revenues/ expenses    
Operating revenues    
Revenues $ 17 $ 19
Operating expenses    
Expenses (16) (17)
Other revenues    
Operating revenues    
Revenues [1] 12 9
Vessel and rig    
Operating expenses    
Expenses $ (316) $ (304)
[1] Includes transactions with related parties. Refer to Note 28 – Related party transactions.
v3.21.2
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Statement of Comprehensive Income [Abstract]    
Net loss $ (605) $ (1,748)
Other comprehensive gain/(loss), net of tax:    
Share of other comprehensive profit/(loss) from associated companies 4 (17)
Change in fair value of debt component of Archer convertible bond 1 2
Actuarial loss relating to pension 0 (7)
Other comprehensive gain/(loss) 5 (22)
Total comprehensive loss for the period (600) (1,770)
Comprehensive loss attributable to the shareholder (600) (1,769)
Comprehensive loss attributable to the non-controlling interest 0 (2)
Comprehensive gain attributable to the redeemable non-controlling interest $ 0 $ 1
v3.21.2
UNAUDITED CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Current assets    
Cash and cash equivalents $ 428 $ 526
Restricted cash 147 132
Accounts receivable, net 122 125
Amounts due from related parties, net 50 85
Other current assets 200 194
Total current assets 947 1,062
Non-current assets    
Investments in associated companies 248 248
Drilling units 1,927 2,120
Restricted cash 69 65
Deferred tax assets 8 9
Equipment 16 19
Amounts due from related parties, net 410 392
Other non-current assets 32 46
Total non-current assets 2,710 2,899
Total assets 3,657 3,961
Current liabilities    
Debt due within one year 546 6,177
Trade accounts payable 57 45
Amounts due to related parties - current 0 7
Other current liabilities 275 316
Total current liabilities 878 6,545
Liabilities subject to compromise 6,406  
Non-current liabilities    
Long-term debt due to related parties 0 426
Deferred tax liabilities 8 10
Other non-current liabilities 105 120
Total non-current liabilities 113 556
Commitment and contingencies (See note 29)
Equity    
Common shares of par value US$0.10 per share: US$0.10 per share: 138,880,000 shares authorized and 100,384,435 issued at June 30, 2021 and December 31, 2020 10 10
Additional paid-in capital 3,504 3,504
Accumulated other comprehensive loss (21) (26)
Retained loss (7,233) (6,628)
Total shareholders’ equity (3,740) (3,140)
Non-controlling interest 0 0
Total deficit (3,740) (3,140)
Total liabilities and equity $ 3,657 $ 3,961
v3.21.2
UNAUDITED CONSOLIDATED BALANCE SHEETS (Parenthetical)
Jun. 30, 2021
$ / shares
shares
Statement of Financial Position [Abstract]  
Common shares, par value (in dollars per share) | $ / shares $ 0.10
Common shares authorized (in shares) 138,880,000
Common stock, issued (in shares) 100,384,435
v3.21.2
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Cash Flows from Operating Activities    
Net loss $ (605) $ (1,748)
 Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation 83 182
Loss on disposals (11) 0
Share in results from associated companies (net of tax) (2) 66
Loss on impairment of investments 0 47
Loss on impairment of convertible bond from related party 0 29
Unrealized (gain)/loss related to derivative financial instruments (5) 1
Loss on impairment of long-lived assets 152 1,230
Deferred tax benefit (1) (2)
Unrealized (gain)/ loss on marketable securities (5) 6
Payment-in-kind interest 12 7
Non-cash reorganization items 178 0
Amortization of discount on debt 54 17
Unrealized foreign exchange (gain)/loss (4) 22
Change in allowance for credit losses 60 63
Other cash movements in operating activities    
Distributions received from associated company 6 2
Payments for long-term maintenance (26) (71)
Repayments made under lease arrangements (31) 0
Changes in operating assets and liabilities, net of effect of acquisitions and disposals    
Trade accounts receivable 10 16
Trade accounts payable 15 (16)
Prepaid expenses/accrued revenue 3 1
Deferred revenue 3 (1)
Related party receivables (17) (88)
Related party payables 1 (9)
Other assets (8) 5
Other liabilities 74 (39)
Other, net 0 2
Net cash used in operating activities (64) (278)
Cash Flows from Investing Activities    
Additions to drilling units and equipment (13) (14)
Contingent consideration received 0 16
Proceeds from disposal of drilling unit 7 0
Purchase of call option for non-controlling interest shares 0 (11)
Loans granted to related party (23) (8)
Payments received from loans granted to related parties 10 4
Net cash used in investing activities (19) (13)
Cash Flows from Financing Activities    
Repayments of secured credit facilities 0 (24)
Net cash used in financing activities 0 (24)
Effect of exchange rate changes on cash 4 (22)
Net decrease in cash and cash equivalents, including restricted cash (79) (337)
Cash and cash equivalents, including restricted cash, at beginning of the period 723 1,357
Cash and cash equivalents, including restricted cash, at the end of period 644 1,020
Supplementary disclosure of cash flow information    
Interest paid, net of capitalized interest 0 (167)
Taxes paid $ (3) $ (7)
v3.21.2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($)
$ in Millions
Total
Cumulative Effect, Period of Adoption, Adjustment
Cumulative Effect, Period of Adoption, Adjusted Balance
Parent
Parent
Cumulative Effect, Period of Adoption, Adjustment
Parent
Cumulative Effect, Period of Adoption, Adjusted Balance
Common Stock
Common Stock
Cumulative Effect, Period of Adoption, Adjusted Balance
Additional Paid-in Capital
Additional Paid-in Capital
Cumulative Effect, Period of Adoption, Adjusted Balance
AOCI Attributable to Parent
AOCI Attributable to Parent
Cumulative Effect, Period of Adoption, Adjusted Balance
Retained Earnings
Retained Earnings
Cumulative Effect, Period of Adoption, Adjustment
Retained Earnings
Cumulative Effect, Period of Adoption, Adjusted Balance
Noncontrolling Interest
Noncontrolling Interest
Cumulative Effect, Period of Adoption, Adjusted Balance
Common shares, outstanding (in shares), beginning balance at Dec. 31, 2019             10,000,000 10,000,000                  
Beginning balance at Dec. 31, 2019 $ 1,793 $ (143) $ 1,650 $ 1,642 $ (143) $ 1,499     $ 3,496 $ 3,496 $ (13) $ (13) $ (1,851) $ (143) $ (1,994) $ 151 $ 151
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                  
Purchase option on non-controlling interest 11                             11  
Share-based compensation charge 2     2         2                
Net loss (1,747)     (1,745)                 (1,745)     (2)  
Other comprehensive loss (22)     (22)             (22)            
Fair Value adjustment AOD Redeemable NCI 30     30                 30        
Common shares, outstanding (in shares), ending balance at Jun. 30, 2020             10,000,000                    
Ending balance at Jun. 30, 2020 $ (98)     (236)         3,498   (35)   (3,709)     138  
Common shares, outstanding (in shares), beginning balance at Dec. 31, 2020 100,384,435           10,000,000                    
Beginning balance at Dec. 31, 2020 $ (3,140)     (3,140)         3,504   (26)   (6,628)     0  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                  
Net loss (605)     (605)                 (605)        
Other comprehensive loss $ 5     5             5            
Common shares, outstanding (in shares), ending balance at Jun. 30, 2021 100,384,435           10,000,000                    
Ending balance at Jun. 30, 2021 $ (3,740)     $ (3,740)         $ 3,504   $ (21)   $ (7,233)     $ 0  
v3.21.2
General information
 6 Months Ended
Jun. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
General information General information
Seadrill Limited is incorporated in Bermuda and is a publicly listed company on the Oslo Stock Exchange. We provide offshore drilling services to the oil and gas industry. As at June 30, 2021 we owned 32 offshore drilling units as well as operate 1 rig under lease from Northern Ocean. Our fleet consists of drillships, jack-up rigs and semi-submersible rigs for operations in shallow and deepwater areas, and in benign and harsh environments. We also provide rig management services to SeaMex, Northern Ocean, Sonadrill and Aquadrill (formerly Seadrill Partners).

Except where the context otherwise requires or where otherwise indicated, the terms “Seadrill,” “the Group,” “we,” “us,” “our,” “the Company” and “our Business” refer to either Seadrill Limited, any one or more of its consolidated subsidiaries, or to all such entities.

Seadrill Limited is a publicly-held Bermuda exempted company limited by shares and prior to June 19, 2020 was listed under the Symbol "SDRL" on the New York Stock Exchange ("NYSE") and the Oslo Stock Exchange ("OSE"). On June 19, 2020 it delisted from the NYSE and began trading on the over-the-counter ("OTC") market under the Symbol "SDRLF". In May 2021, Seadrill Limited's shares transitioned to trading on OTC Pink Open Marketplace under the symbol "SDRLF". Seadrill has retained its primary listing on the OSE.

Chapter 11 Proceedings and going concern

Since the mid-2010s, the industry has experienced a sustained decline in oil prices which has culminated in an industry-wide supply and demand imbalance. During this period, market dayrates for drilling rigs have been lower than was anticipated when the debt associated with acquiring our rigs was incurred. This challenging business climate was further destabilized by challenges that have arisen due to the COVID-19 pandemic. The actions taken by governmental authorities around the world to mitigate the spread of COVID-19 have had a significant negative effect on oil consumption. This has led to a further decrease in the demand for our services and has had an adverse impact on our business and financial condition.

Since the end of 2019, we have been working with senior creditors to provide a solution to Seadrill's high cash outflow for debt service. In June, 2020, we announced that we had appointed financial advisors to evaluate comprehensive restructuring alternatives to reduce debt service costs and overall indebtedness.

In September 2020, we ceased making interest payments on our secured credit facilities which constituted an event of default. Furthermore, this triggered cross-defaults on the senior secured notes and leasing agreements in respect of the West Hercules, West Linus and West Taurus with subsidiaries of SFL Corporation Limited. The events of default meant that amounts due on the secured credit facilities and senior notes became callable on demand. As of December 31, 2020, we had $6,177 million in principal amount of these debt obligations. Our available resources would not have been sufficient to repay these obligations were they called.

On February 7, 2021 and February 10, 2021 the Debtors filed voluntary petitions for reorganization under Chapter 11, triggering a stay on enforcement of remedies with respect to our debt obligations. As part of the Chapter 11 Proceedings, the Debtors were granted “first-day” relief which enables us to continue operations without interruption.

Negotiations on the comprehensive restructuring continued with the lenders until July 24, 2021 when Seadrill Limited entered into a Plan Support Agreement (the “PSA”) with certain of the Company’s senior secured lenders holding approximately 57.8% of the Company’s senior secured loans (the “Consenting Lenders”) as well as a backstop commitment letter entered into with certain of the Consenting Lenders. The agreements contemplate a Plan of Reorganization (the “POR”) that will raise $350 million in new financing and reduce the Company’s liabilities by over $5 billion. The POR provides a clear pathway for Seadrill to restructure its balance sheet with the support of the majority of its senior secured lenders. Certain of the Consenting Lenders have also agreed to backstop a first lien exit facility totaling $300 million.

The lenders participating in (and backstopping) the new-money facility will collectively receive 16.75% of new equity in the newly constituted Seadrill, subject to dilution. Under the POR, the senior secured lenders will also exchange $5.6 billion of existing debt for $750 million of second-lien, 'take-back' debt and 83% of the new equity, subject to dilution. Hemen Holding Ltd., currently the Company’s largest shareholder, has also committed to fund a $50 million new-money unsecured bond to be issued under the POR, which is convertible into 5% of the new equity under specified circumstances. Specified trade claims will be paid in full in cash and other general unsecured claims will receive their pro rata share of $250,000 in cash. Existing shareholders will receive 0.25% of the new equity, subject to dilution, if all voting classes of creditors accept the POR, and otherwise will not receive any recovery. Consummation of the POR is subject to a number of customary terms and conditions, including court approval.

As of June 30, 2021, Seadrill had cash and cash equivalents of $644 million (December 31, 2020: $723 million) of which $428 million (December 31, 2020: $526 million) was unrestricted and we have implemented, and will continue to implement, various measures to preserve liquidity. These include an increased focus on operating efficiency, reductions in corporate and overhead expenditures, and deferrals of capital expenditures. Whilst we believe this should provide sufficient liquidity for the 12 month period from the issuance of these financial statements to allow us to complete a comprehensive restructuring, the process is difficult to predict and subject to factors outside of our control. We are subject to numerous risks associated with the bankruptcy proceedings and, whilst we have entered into a
PSA with the Consenting Lenders holding approximately 57.8% of our senior secured debt, there can be no assurance that we will obtain sufficient support from our remaining creditors, nor that the Bankruptcy Court will confirm the plan.

These conditions and events raise substantial doubt as to our ability to continue as a going concern for the 12 months after the date our financial statements are issued. Financial information in this report has been prepared on a going concern basis of accounting, which presumes that we will be able to realize our assets and discharge our liabilities in the normal course of business as they come due. Financial information in this report does not reflect the adjustments to the carrying values of assets, liabilities and the reported expenses and balance sheet classifications that would be necessary if we were unable to realize our assets and settle our liabilities as a going concern in the normal course of operations. Such adjustments could be material.

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, its 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 (though not directly or indirectly holding more than 50% of the voting control).

The accompanying unaudited interim financial statements, in the opinion of management, include all material 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, 2020 (SEC File No. 333-224459).

Bankruptcy accounting

We have operated as a debtor-in-possession from February 10, 2021. We have prepared our Consolidated Financial Statements under Accounting Standards Codification 852, Reorganizations ("ASC 852"). ASC 852 requires that the financial statements 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 were realized or incurred in the bankruptcy proceedings are recorded in “Reorganization items" on our Consolidated Statements of Operations. In addition, ASC 852 requires changes in the accounting and presentation of significant items on the Consolidated Balance Sheets, particularly liabilities. Pre-petition obligations that may have been impacted by the Chapter 11 reorganization process have been classified on the Consolidated Balance Sheets within "Liabilities subject to compromise". For details of the Chapter 11 process, refer to Note 3 - "Chapter 11 Proceedings".

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, 2020, except as set out below and in Note 2 - "Recent accounting pronouncements".

Use of Estimates

The preparation of our consolidated financial statements requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenues and expenses and related disclosure of contingent assets and liabilities. The full extent to which the COVID-19 pandemic will directly or indirectly impact our business, results of operations and financial condition, including sales, expenses and reserves and allowances will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain it or treat COVID-19, as well as the economic impact on local, regional, national and international customers and markets. We have made estimates of the impact of COVID-19 within our financial statements and there may be changes to those estimates in future periods. Actual results may differ from these estimates.
v3.21.2
Recent accounting pronouncements
 6 Months Ended
Jun. 30, 2021
Accounting Changes and Error Corrections [Abstract]  
Recent accounting pronouncements Recent accounting pronouncements
Recently adopted accounting standards

We have not adopted any new accounting standard updates ("ASUs") since the reporting date of our Form 20-F report.

Other ASUs

We additionally adopted the following accounting standard updates in the year which did not have any material impact on our Consolidated Financial Statements and related disclosures:
ASU 2019-12 Income Taxes (Topic 740): Simplifying the accounting for income taxes

In December 2019, the FASB issued ASU 2019-12. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The guidance will be effective from January 1, 2021 on a mainly prospective basis, with early adoption permitted. This amendment had no material impact on our consolidated financial statements or related disclosures.

Recently issued accounting standards

The FASB issued the following ASUs that we have not yet adopted but which could affect our Consolidated Financial Statements and related disclosures in future periods:

ASU 2020-04 & ASU 2021-01 Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). This update is intended to provide relief to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022. We are in the process of evaluating the impact of this standard update on our Consolidated Financial Statements and related disclosures.

In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848). The amendments in this Update are elective and apply to all entities that have derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. The amendments in this update do not apply to contract modifications made after December 31, 2022. We are in the process of evaluating the impact of this standard update on our Consolidated Financial Statements and related disclosures.

ASU 2020-06 Debt with Conversion and Other Options and Hedging - Contracts in Entity's Own Equity

In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) which simplifies the accounting for convertible instruments, such as exchangeable debt, by limiting the accounting models that result in separately recognizing embedded conversion features from the host contract. The accounting standards update also enhances information transparency by making targeted improvements to the disclosures for convertible instruments and earnings-per-share guidance. Update 2020-06 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. We are in the process of evaluating the impact this amendment will have on our Consolidated Financial Statements and related disclosures.
v3.21.2
Chapter 11 Proceedings
 6 Months Ended
Jun. 30, 2021
Reorganizations [Abstract]  
Chapter 11 Proceedings Chapter 11 Proceedings
Bankruptcy proceedings under Chapter 11

On February 7, 2021 and February 10, 2021 the Debtors filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code ("Chapter 11 Proceedings") in the United States Bankruptcy Court for the Southern District of Texas (the "Bankruptcy Court"), triggering a stay on enforcement of remedies with respect to our debt obligations. The filing did not include Seadrill New Finance Limited and its subsidiaries, which hold our investments in Seamex and Seabras Sapura and are also the issuers of the senior secured notes.

On July 24, 2021, we entered into a plan support agreement (the “PSA”) with certain of our senior secured lenders. The agreements contemplate a plan of reorganization that will raise $350 million in new financing and reduce our liabilities by over $4.9 billion. Certain of the Consenting Lenders have also agreed to backstop a first lien exit facility totaling $300 million.

The lenders participating in (and backstopping) the new-money facility will collectively receive 16.75% of new equity in the newly constituted Seadrill, subject to dilution. Under the Plan, the senior secured lenders will also exchange $5.6 billion of existing debt for $750 million of second-lien, 'take-back' debt and 83% of the new equity, subject to dilution.

Hemen Holding Ltd., currently our largest shareholder, has also committed to fund a $50 million new-money unsecured bond to be issued under the Plan, which is convertible into 5% of the new equity under specified circumstances. Specified trade claims will be paid in full in cash and other general unsecured claims will receive their pro rata share of $250,000 in cash. Existing shareholders will receive 0.25% of the new equity, subject to dilution, if all voting classes of creditors accept the Plan, and otherwise will not receive any recovery.

Consummation of the Plan is subject to a number of customary terms and conditions, including court approval.

Accounting Guidance

ASC 852-10, Reorganizations, applies to entities that have filed a petition for relief under Chapter 11 of the Bankruptcy Code. In accordance with ASC 852-10, transactions and events directly associated with the reorganization are required to be distinguished from the ongoing operations of the business. In addition, the guidance requires changes in the accounting and presentation of liabilities, as well as expenses and income directly associated with the Chapter 11 Cases.
We may be required to adopt fresh start accounting upon emergence from Chapter 11. Adopting fresh start accounting would result in the allocation of the reorganization value to individual assets based on their estimated fair values. The enterprise value of the equity of the emerging company is based on several assumptions and inputs contemplated in the future projections of the plan of reorganization and are subject to significant uncertainties. We currently cannot estimate the potential financial effect of fresh start accounting on our consolidated financial statements upon the emergence from Chapter 11, although we would expect to recognize material adjustments upon implementation of fresh-start accounting guidance upon emergence.

Liabilities subject to compromise

Liabilities subject to compromise distinguish pre-petition liabilities which may be affected by the Chapter 11 proceedings from those that will not. The liabilities held as subject to compromise are disclosed on a separate line on the consolidated balance sheet.

Liabilities subject to compromise represent our estimate of known or potential pre-petition claims to be resolved in connection with the Chapter 11 proceedings. Such claims remain subject to future adjustments which may result from: (i) negotiations; (ii) actions of the Bankruptcy Court; (iii) disputed claims; (iv) rejection of executory contracts and unexpired leases; (v) the determination as to the value of any collateral securing claims; (vi) proofs of claim; or (vii) other events. Such future adjustments will potentially be material.

Liabilities subject to compromise, as presented on the Consolidated Balance Sheet as at June 30, 2021, include the following:

(In $ millions)As at June 30, 2021
Senior under-secured external debt5,662 
Accounts payable and other liabilities75 
Accrued interest on external debt34 
Amount due to related party645 
Liabilities subject to compromise in combined filers6,416 
Less: Elimination of positions held with non-filers within the Seadrill Consolidated Group(10)
Liabilities subject to compromise in consolidated group6,406 

Our external credit facilities are secured by, among other things, liens on our drilling units. As the fair value of our drilling units do not equal or exceed the carrying value of the debt, we hold this as subject to compromise as they are unsecured.

Our credit facility agreements contain cross-default provisions, meaning that if we defaulted and amounts became due and payable under one of our credit agreements, this would trigger a cross-default in our other facilities. Accordingly, the default on our external debt facilities also triggered an event of default under our senior secured notes, resulting in them being classified as current. The senior secured notes are not subject to compromise as subsidiaries of Seadrill New Finance Limited did not file for Chapter 11 and are held as "debt due within one year" on our Consolidated Balance Sheet.

While operating as a Debtor-in-Possession under Chapter 11 of the Bankruptcy Code, the Debtors may sell, otherwise dispose of, 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, a plan of reorganization could materially change the amounts and classifications of assets and liabilities in the historical Consolidated Financial Statements.

Interest expense

The Debtors have discontinued recording interest on the under-secured debt facilities from the petition date, in line with the guidance of ASC 852-10, Reorganizations. Contractual interest on liabilities subject to compromise not reflected in the Consolidated Statement of Operations was $128 million.

Potential claims

The Debtors have filed with the Bankruptcy Court schedules and statements setting forth, among other things, the assets and liabilities of the Debtors, subject to the assumptions filed in connection therewith. The schedules and statements may be subject to further amendment or modification after filing.

All holders of pre-petition claims except governmental units were required to file proofs of claim by June 14, 2021 (the "Bar Date"). Governmental units holding claims against the Debtors are required to file proof of claim by August 11, 2021. At the Bar Date, 430 claims totaling approximately $8.8 billion had been filed with the Bankruptcy Court against the Debtors. Subsequent to this date, an immaterial number of further claims have been processed.

It is possible that claimants will file amended claims in the future, including claims amended to assign values to claims originally filed with no designated value. Through the claims resolution process, we have identified, and we expect to continue to identify, claims that we believe should be disallowed by the Bankruptcy Court because they are duplicative, have been later amended or superseded, are without
merit, are overstated or for other reasons. We will file objections with the Bankruptcy Court as necessary for claims we believe should be disallowed. Claims we believe are allowable are reflected in "Liabilities Subject to Compromise" in the Consolidated Balance Sheets.

Through the claims resolution process, differences in amounts scheduled by the Debtors and claims filed by creditors will be investigated and resolved, including through the filing of objections with the Bankruptcy Court where appropriate. Accordingly, the ultimate number and amount of allowed claims is not presently known, nor can the ultimate recovery with respect to allowed claims be presently ascertained.

Executory Contracts

Under the Bankruptcy Code, the Debtors have the right to assume, amend and assume or reject certain contracts, subject to the approval of the Bankruptcy Court and certain other conditions. Generally, the assumption of a contract requires a debtor to satisfy pre-petition obligations under the contract, which may include payment of pre-petition liabilities in whole or in part. Rejection of a contract is typically treated as a breach occurring as of the moment immediately preceding the Chapter 11 filing. Subject to certain exceptions, this rejection relieves the debtor from performing its future obligations under the contract but entitles the counterparty to assert a prepetition general unsecured claim for damages.

On February 12, 2021, we filed an order of rejection of the lease contract with respect to the West Taurus and consequently the lease has been rejected. During the first-half of 2021, we handed the rig back to SFL. The lease termination led to a remeasurement of the outstanding amounts due to SFL held within liabilities subject to compromise, resulting in a $186 million loss within "Reorganization items" on the Consolidated Statement of Operations.

Reorganization items, net

Incremental costs incurred directly as a result of the bankruptcy filing and any gains or losses on adjustment to the expected allowed claim value under the plan of reorganization are classified as "Reorganization items, net" in the Consolidated Statement of Operations. The following table summarizes the reorganization items recognized in the six months ended June 30, 2021:
(In $ millions)Six months ended June 30, 2021
Advisory and professional fees after filing(52)
Remeasurement of terminated lease to allowable claim(186)
Gain on write-off of related party balances8 
Total reorganization items(230)

Condensed Combined Debtors Financial Statements

When one or more entities in the consolidated group are in bankruptcy and one or more entities in the consolidated group are not in bankruptcy, the reporting entity is required to disclose the condensed combined financial statements of only the entities in bankruptcy.

The financial statements below represent the Condensed Combined Financial Statements of the entities that filed for bankruptcy (“debtor in possession” or “DIP”). Intercompany transactions between the Debtors have been eliminated in the financial statements herein.
Debtors' unaudited combined Statement of Operations for the six months ended June 30, 2021

(In $ millions)Six months ended June 30, 2021
Operating revenues
Contract revenues335 
Reimbursable revenues17 
Management contract revenues88 
Other revenues12 
Total operating revenues452 
Operating expenses
Vessel and rig operating expenses(316)
Reimbursable expenses(16)
Management contract expense(118)
Depreciation(83)
General and administrative expenses(36)
Total operating expenses(569)
Other operating items
Loss on impairment of long-lived assets(152)
Gain on sale of assets11 
Other operating income3 
Total other operating items(138)
Operating loss(255)
Financial and other non-operating items
Interest income1 
Total Interest expenses(79)
Share in results of joint ventures1 
Foreign currency exchange gain9 
Other financial items(13)
Reorganization items(230)
Total financial and other non-operating items, net(311)
Loss before income taxes(566)
Income tax expense(9)
Net loss(575)
Debtors' unaudited combined Balance Sheet as at June 30, 2021

(In $ millions)As at June 30,
2021
ASSETS 
Current assets 
Cash and cash equivalents414 
Restricted cash78 
Accounts receivable, net122 
Amounts due from related parties, net81 
Other current assets185 
Total current assets880 
Non-current assets 
Investment in associated companies and joint ventures25 
Drilling units1,927 
Shares in subsidiaries409 
Restricted cash69 
Deferred tax assets8 
Equipment16 
Amount due from related party, net3 
Other non-current assets32 
Total non-current assets2,489 
Total assets3,369 
LIABILITIES AND EQUITY 
Current liabilities 
Trade accounts payable(56)
Short-term debt due to related party(1)
Other current liabilities(239)
Total current liabilities(296)
Liabilities subject to compromise(6,416)
Non-current liabilities 
Deferred tax liability(8)
Other non-current liabilities(105)
Total non-current liabilities(113)
Equity 
Total equity3,456 
Total liabilities and equity(3,369)
Debtors' unaudited Statement of Cash Flows for the six months ended June 30, 2021

(In $ millions)Six months ended June 30, 2021
Cash Flows from Operating Activities 
Net loss(575)
 Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation83 
Gain on sale of assets(11)
Share in results from joint ventures (net of tax)(1)
Loss on impairment of long-lived assets152 
Deferred tax benefit(1)
Non-cash reorganization items178 
Unrealized foreign exchange gain(4)
Change in allowance for credit losses54 
Other cash movements in operating activities
Payments for long-term maintenance(26)
Repayments made under lease arrangements(12)
Changes in operating assets and liabilities, net of effect of acquisitions and disposals
Trade accounts receivable3 
Trade accounts payable14 
Related party receivables— 
Related party payables28 
Other assets11 
Other liabilities45 
Net cash flows used in operating activities(62)
Cash Flows from Investing Activities
Additions to drilling units and equipment(13)
Proceeds from disposal of drilling unit7 
Net cash flows used in investing activities(6)
Cash Flows from Financing Activities
Net cash used in financing activities— 
Effect of exchange rate changes on cash4 
Net decrease in cash and cash equivalents, including restricted cash(64)
Cash and cash equivalents, including restricted cash, at beginning of the period625 
Cash and cash equivalents, including restricted cash, at the end of period561 
v3.21.2
Current expected credit losses
 6 Months Ended
Jun. 30, 2021
Credit Loss [Abstract]  
Current expected credit losses Current expected credit losses
The Current Expected Credit Losses model applies to our external trade receivables, related party receivables and other financial assets carried at amortized cost. Our external customers are international oil companies, national oil companies and large independent oil companies.
The following table summarizes the movement in the allowance for credit losses for the six months ended June 30, 2021 and June 30, 2020:
 (In $ millions)
Allowance for credit losses - trade receivablesAllowance for credit losses - other current assetsAllowance for credit losses - related party STAllowance for credit losses related party LTTotal Allowance for credit losses
As at January 1, 2020— — 15 128 143 
Credit loss expense— 5 54 4 63 
As at June 30, 2020— 5 69 132 206 

 (In $ millions)
Allowance for credit losses - trade receivablesAllowance for credit losses - other current assetsAllowance for credit losses - related party STAllowance for credit losses related party LTTotal Allowance for credit losses
As at January 1, 2021— 3 169 137 309 
Credit loss expense— — 48 12 60 
Write-off (1)
— — (74)— (74)
As at June 30, 2021— 3 143149295
(1) In April 2021 we signed a settlement agreement with Aquadrill (formerly Seadrill Partners) which waived all claims on pre-petition positions held, as such $54 million of trading receivables and $20 million of loans has been written-off.

The below table shows the classification of the credit loss expense within the consolidated statement of operations.

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Management contract expenses48 50 
Other financial items12 13 
Total60 63 

Changes in allowances for external and related party trade receivables and reimbursable amounts due are included in operating expenses, while changes in the allowances for related party loan receivables are included in other financial items.

The increase in the allowance for the six months ended June 30, 2021 was caused by the restructuring of Seamex and an updated settlement agreement with Northern Ocean.
v3.21.2
Segment information
 6 Months Ended
Jun. 30, 2021
Segment Reporting [Abstract]  
Segment information Segment information
We use the management approach to identify our operating segments. We identified the Board of Directors as the Group’s chief operating decision maker ("CODM") which regularly reviews internal reports when making decisions about allocation of resources to segments and in assessing their performance. In the second half of 2020, we implemented a new operating unit structure which had an increased focus on asset class. The rationale behind this change was to better benchmark our operational performance against so called ‘pure play’ peers who are product line focused, thereby enhancing transparency, efficiency, cost control and leadership focus by asset class. We updated our reportable segments in line with this change.

We now have the following three reportable segments:

1.Harsh environment: Includes contract revenues, management contract revenue, reimbursable revenue and associated expenses for harsh environment semi-submersible and jack-up rigs.
2.Floaters: Includes contract revenues, management contract revenue, reimbursable revenue and associated expenses for benign environment semi-submersible rigs and drillships.
3.Jack-ups: Includes contract revenues, management contract revenue, reimbursable revenue and associated expenses for benign environment jack-up rigs.

We previously included revenues and expenses relating to management services in the "other" reportable segment. We have now allocated revenues relating to management contracts and associated expenses to the three operating segments based on the type of rig being managed. This is in line with how segment performance is now assessed by the CODM based on both owned and managed rigs results.
Segment results are evaluated on the basis of operating income and the information presented below is based on information used for internal management reporting. The change in reportable segments has been reflected retrospectively. Corresponding items of segment information for earlier periods have been recast. The remaining incidental revenues and expenses not included in the reportable segments are included in the "other" reportable segment.

The below section splits out total operating revenue, depreciation, amortization of intangibles, operating net loss, drilling units and capital expenditures by segment:

Total operating revenue
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment232 276 
Floaters154 216 
Jack-up rigs60 98 
Other6 8 
Total452 598 

Depreciation
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment43 52 
Floaters19 105 
Jack-up rigs21 25 
Total83 182 

Loss on impairment of long-lived assets

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment152 160 
Floaters— 1,070 
Jack-ups— — 
Total152 1,230 

Operating loss - Net loss
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment(177)(147)
Floaters(27)(1,184)
Jack-ups(1)10 
Other(47)(51)
Operating loss(252)(1,372)
Unallocated items:
Total financial items and other(342)(374)
Income taxes(11)(2)
Net loss(605)(1,748)
Drilling units - Total assets
(In $ millions)As at June 30, 2021As at December 31,
2020
Harsh environment858 1,032 
Floaters507 528 
Jack-ups562 560 
Total drilling units1,927 2,120 
Unallocated items:
Investments in associated companies248248
Cash and restricted cash644 723 
Other assets838 870 
Total assets3,657 3,961 

Drilling units - Capital expenditures
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment17 11 
Floaters12 58 
Jack-ups10 7 
Other1 9 
Total40 85 

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 $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Norway234 291 
Brazil54 19 
Angola53 98 
United States46 59 
Saudi Arabia42 62 
Nigeria— 5 
Others (1)
23 64 
Total452 598 
(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.
Fixed assets – drilling units (1)
(In $ millions)As at June 30, 2021As at December 31,
2020
Norway858 1,044 
Saudi Arabia230 234 
Brazil161 79 
Qatar150 151 
Malaysia130 185 
United States87 87 
Other (2)
311 340 
Total1,927 2,120 
(1)     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" represents countries in which we operate that individually had fixed assets representing less than 5% of total fixed assets for any of the periods presented.

Major Customers
We had the following customers with total revenues greater than 10% in any of the periods presented:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
ConocoPhillips19 %13 %
Lundin12 %— %
Equinor13 %19 %
Sonagol10 %9 %
Saudi Aramco9 %10 %
Northern Ocean5 %14 %
v3.21.2
Revenue from Contracts with Customers
 6 Months Ended
Jun. 30, 2021
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
The following table provides information about receivables and contract liabilities from our contracts with customers:
(In $ millions)As at June 30, 2021 As at December 31,
2020
Accounts receivable, net122 125 
Current contract liabilities (deferred revenue) (1)
(24)(18)
Non-current contract liabilities (deferred revenue) (2)
(7)(13)

(1)  Current contract liabilities balances are included in “Other current liabilities” in our Consolidated Balance Sheet.
(2) Non-current contract liabilities balances are included in “Other non-current liabilities” in our Consolidated Balance Sheet.

Significant changes in the contract assets and the contract liabilities balances during the six months ended June 30, 2020 are as follows:
(In $ millions)  Contract AssetsContract LiabilitiesNet Contract
Balances
Net contract liability at January 1, 2020  — (29)(29)
Amortization of revenue that was included in the beginning contract liability balance  — 15 15 
Cash received, excluding amounts recognized as revenue  — (19)(19)
Net contract liability at June 30, 2020— (33)(33)
Significant changes in the contract assets and the contract liabilities balances during the six months ended June 30, 2021 are as follows:
(In $ millions)  Contract AssetsContract LiabilitiesNet Contract
Balances
Net contract liability at January 1, 2021  — (31)(31)
Amortization of revenue that was included in the beginning contract liability balance  — 10 10 
Cash received, excluding amounts recognized as revenue— (10)(10)
Net contract liability at June 30, 2021  — (31)(31)
Deferred revenue - The deferred revenue balance of $24 million reported in "Other current liabilities" at June 30, 2021 is expected to be realized within the next twelve months and $7 million reported in "Other non-current liabilities" is expected to be realized within the following twelve months. The deferred revenue included consists primarily of 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.
v3.21.2
Other revenues
 6 Months Ended
Jun. 30, 2021
Revenue from Contract with Customer [Abstract]  
Other revenues Other revenues
Other revenues consist of the following:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Leasing revenues12 9 
Total other revenues12 9 

Leasing revenues

Revenue earned on the charter of the West Castor, West Telesto and West Tucana to Gulfdrill.
v3.21.2
Other operating items
 6 Months Ended
Jun. 30, 2021
Other Income and Expenses [Abstract]  
Other operating items Other operating items
Other operating items consist of the following:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Impairment of long-lived assets (i)
(152)(1,230)
Gain on disposals (ii)
11 — 
Other operating income (iii)
3 8 
Total other operating items(138)(1,222)

i. Impairment of long-lived assets

In the six months ended June 30, 2021, the West Hercules was impaired by $152 million. Refer to Note 9 – "Impairment of long-lived assets" for further details.

In the six months ended June 30, 2020 we determined the global impact of the COVID-19 pandemic and continued down cycle in the offshore drilling industry were indicators of impairment on certain assets. Following assessments of recoverability in March 2020, we recorded total impairment charges of $1,230 million.

ii. Gain on disposals

The West Vigilant was sold to PT Duta Marina for $7 million on June 30, 2021. Further, a gain of $4 million was recognized relating to the disputed West Mira blow out preventer and spares as part of the settlement agreement with Northern Drilling.

As these assets were fully impaired to nil net book value in 2020, the full consideration has been recognized as a gain.

iii. Other operating income

In the six months ended June 30, 2021 Seadrill entered into a collaboration with Marsden Group to implement and improve a solution for the digitalization of data on rigs. Subsequently, Microsoft acquired the Marsden Group and Seadrill was entitled to a portion of the settlement.
In the six months ended June 30, 2020 other operating income consists of the settlement of a claim on our loss of hire insurance policy following an incident on the Sevan Louisiana.
v3.21.2
Impairment of long-lived assets
 6 Months Ended
Jun. 30, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Impairment of long-lived assets 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.

In 2020, the significant decrease in the price of oil due to the actions of OPEC and its partners combined with the global impact of the COVID-19 pandemic resulted in expected decreases in utilization going forward and downward pressure on dayrates. We concluded that an impairment triggering event had occurred for our drilling unit fleet and, based on the results of further testing, recorded an impairment charge of $1,230 million.

While there have been no further macro-economic indicators of impairment in 2021, with the oil price increasing by c. 50% from December 2020, changes to our forecast assumptions regarding the future of the West Hercules and West Linus have led us to conclude that an impairment triggering event has occurred for these two rigs. We expected that these rigs will be disposed of significantly before the end of their previously estimated useful life. Subsequent to the period end, the terms of the West Hercules lease have been changed to reflect this early disposal.

As at June 30, 2021, the undiscounted future net cash flows to be generated for Seadrill by the West Hercules and West Linus were revised due to anticipated changes in leasing arrangements that may result in the rigs being handed back to SFL before the end of their estimated useful lives. The revised undiscounted future net cash flows for the West Hercules were less than the rig's carrying value meaning that the "step one" or "asset recoverability" test was failed for that rig. Following this assessment, we recorded an impairment charge of $152 million to reduce the rig's book value to its estimated fair value, which we estimated using a discounted cash flow model. There was no impairment charge for the West Linus as it still passed the asset recoverability test.

This resulted in an impairment expense of $152 million and $1,230 million for the six months ended June 30, 2021 and June 30, 2020 respectively, which was classified within "Impairment of long-lived assets" on our Consolidated Statement of Operations

We derived the fair value of the rigs using an income approach based on updated projections of future dayrates, contract probabilities, economic utilization, capital and operating expenditures, applicable tax rates and asset lives. 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 "WACC" of 11.8% in 2021 and 12.8% in 2020. 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.
v3.21.2
Loss on impairment of equity method investments
 6 Months Ended
Jun. 30, 2021
Equity Method Investments and Joint Ventures [Abstract]  
Loss on impairment of equity method investments Loss on impairment of equity method investments
We have recognized the following impairment of our investments in associated companies in the Consolidated Statements of Operations within "Loss on impairment of investments".

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Seadrill Partners - Direct ownership interests—(47)
Total loss on impairment of equity method investments— (47)

On December 1, 2020 Seadrill Partners had entered into restructuring proceedings and, as a result, we concluded that we no longer had significant influence over its financial and operating decisions as decisions now need court approval or are determined by the courts. Our investment in Seadrill Partners was therefore derecognized as an investment in associate and marketable security and recognized as an available-for-sale security at the closing carrying value of the equity investment in associate, being nil. Furthermore, on emergence from Chapter 11 in May 2021 Seadrill Partners (now Aquadrill) canceled the existing equity interests of their investors, including Seadrill Limited.
Investment in associated companies
As at June 30, 2021 and December 31, 2020, the carrying values of our investments in associated companies were as follows.

(In $ millions)As at June 30, 2021As at December 31, 2020
Seabras Sapura108 103 
Shareholder loans provided to Seabras Sapura115 121 
Sonadrill23 22 
Gulfdrill2 2 
Total investment in associated companies248 248 
v3.21.2
Taxation
 6 Months Ended
Jun. 30, 2021
Income Tax Disclosure [Abstract]  
Taxation Taxation
Income tax expense for the six months ended June 30, 2021 was $11 million (six months ended June 30, 2020: expense of $2 million).

The income tax expense of $11 million for the six months ended June 30, 2021 was primarily due to ordinary taxes in the US, Qatar and Saudi Arabia, tax on the gain on pre-petition allowable claims in taxable jurisdictions, and a movement in liabilities for previous uncertain tax positions due to additional interest and penalties accrued.

Seadrill Limited is incorporated in Bermuda where a tax exemption has been granted until 2035. Other jurisdictions in which Seadrill's subsidiaries operate are taxable based on rig operations. A loss in one jurisdiction may not be offset against taxable income in other jurisdictions. Thus, we may pay tax within some jurisdictions even though we might have losses in others.

Tax authorities in certain jurisdictions examine our tax returns and some have issued assessments. We are defending our 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 Balance Sheet, Statement of Operations or Statement of Cash Flow. In 2019, we placed a total of 330 million Brazilian Reais of collateral in order to continue with our appeal against certain years. This amount is held as restricted cash. See Note 13 - "Restricted cash".

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 may be filed in the US court. An adverse outcome on these proposed assessments could result in a material adverse impact on our Consolidated Balance Sheet, Statement of Operations or Statement of Cash Flow.
v3.21.2
Loss per share
 6 Months Ended
Jun. 30, 2021
Earnings Per Share [Abstract]  
Loss per share Loss per share
The computation of basic loss per share (“LPS”) is based on the weighted average number of shares outstanding during the period. Diluted LPS includes the effect of the assumed conversion of potentially dilutive instruments. However, as the current and comparative periods are all loss making, the effect of dilution is nil.

The components of the numerator for the calculation of basic and diluted LPS were as follows:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Net loss attributable to shareholder(605)(1,745)
Effect of dilution— — 
Diluted net loss available to shareholders(605)(1,745)

The components of the denominator for the calculation of basic and diluted LPS were as follows:
 (In millions)Six months ended June 30, 2021Six months ended June 30, 2020
Basic loss per share:
Weighted average number of common shares outstanding100 100
Diluted loss per share:
Effect of dilution— — 
Weighted average number of common shares outstanding adjusted for the effects of dilution100 100 

The basic and diluted loss per share were as follows:
(In $)Six months ended June 30, 2021Six months ended June 30, 2020
Basic loss per share(6.03)(17.40)
Diluted loss per share(6.03)(17.40)
v3.21.2
Restricted cash
 6 Months Ended
Jun. 30, 2021
Restricted Cash and Investments [Abstract]  
Restricted cash Restricted cash
Restricted cash as at June 30, 2021 and December 31, 2020 was as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Demand deposit pledged as collateral for tax related guarantee (1)
69 65 
Accounts pledged as collateral for Senior Secured Notes46 30 
Accounts pledged as collateral for performance bonds and similar guarantees31 48 
Amounts pledged as collateral for leases (2)
22 22 
Proceeds from rig disposals (3)
12 — 
Other36 32 
Total restricted cash216 197 

(1) We placed a total of 330 million Brazilian Reais of collateral with BTG Pactual under a letter of credit agreement. This relates to long-running tax disputes which are currently being litigated through the Brazilian courts. This is held as non-current within the Consolidated Balance Sheet.
(2) Certain accounts are pledged to the SFL SPVs for lease arrangements for the West Taurus, West Linus and West Hercules. Following an event of default in the fourth quarter of 2020, a restriction was placed on these accounts. As such these accounts were reclassified as restricted.
(3) Sales proceeds on disposal of the West Vigilant of $7 million and deposits received for pending disposal of the West Freedom, West Eminence, West Alpha, West Navigator, West Venture and West Pegasus, totaling $5 million, are classified as restricted as they must be paid (net of any permissible sales costs) to the lenders upon emergence from Chapter 11.

Restricted cash is presented in our Consolidated Balance Sheets as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Current restricted cash147 132 
Non-current restricted cash69 65 
Total restricted cash216 197 
v3.21.2
Marketable securities
 6 Months Ended
Jun. 30, 2021
Marketable Securities [Abstract]  
Marketable securities Marketable securities
We hold investments in certain marketable securities which we record at fair value through profit and loss. 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.

The below table shows the carrying value of our investments in marketable securities for periods presented in this report.
(In $ millions)As at June 30, 2021As at December 31, 2020
Archer13 8 
Total marketable securities13 8 

The below table shows the gain and losses recognized through net loss for the periods presented in this report.
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Seadrill Partners - Common units - unrealized loss on marketable securities— (2)
Archer - unrealized gain / (loss) on marketable securities5 (4)
Total unrealized gain / (loss) on marketable securities5 (6)

For information on our previous investment in Seadrill Partners, refer to Note 10 - "Loss on impairment of equity method investments". There was no gain or loss on the cancellation of Seadrill Partners ownership interests as these investments have a nil book value.
v3.21.2
Accounts receivable
 6 Months Ended
Jun. 30, 2021
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract]  
Accounts receivable Accounts receivable
Accounts receivable are held at their nominal amount less an allowance for expected credit losses.
The adoption of ASC 326 on January 1, 2020 did not have a material impact on our third-party accounts receivable balances either on transition or at the year end. In calculating the expected credit losses we assumed that the accounts receivable are performing, mature within three months, and have a Baa3 credit rating. Refer to Note 4 - "Current expected credit losses" for further information.
v3.21.2
Other Assets
 6 Months Ended
Jun. 30, 2021
Other Assets [Abstract]  
Other Assets Other Assets
As at June 30, 2021 and December 31, 2020, other assets included the following:
(In $ millions)As at June 30, 2021As at December 31, 2020
Prepaid Expenses (1)
67 67 
Right of use asset (2)
39 57 
Taxes receivable34 32 
Reimbursable amounts due from customers (3)
18 11 
Deferred contract costs15 14 
Marketable Securities (4)
13 8 
Favorable drilling and management services contracts10 10 
Insurance receivable6 4 
Other assets (5)
30 37 
Total other assets232 240 
(1)Includes retainers paid, but not yet utilized, for legal and advisory fees relating to the Chapter 11 process.
(2)Refer to Note 22 - "Leases" for further information.
(3)Includes related party balances, net of expected credit loss allowance from Northern Ocean. For further information refer to Note 28 – "Related party transactions".
(4)Refer to Note 14 - "Marketable securities" for further information.
(5)Includes $15 million D&O insurance relating to tail back claims in the Chapter 11 process.
Other assets were presented in our Consolidated Balance Sheet as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Other current assets200 194 
Other non-current assets32 46 
Total other assets232 240 
v3.21.2
Investment in associated companies
 6 Months Ended
Jun. 30, 2021
Equity Method Investments and Joint Ventures [Abstract]  
Investment in associated companies Loss on impairment of equity method investments
We have recognized the following impairment of our investments in associated companies in the Consolidated Statements of Operations within "Loss on impairment of investments".

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Seadrill Partners - Direct ownership interests—(47)
Total loss on impairment of equity method investments— (47)

On December 1, 2020 Seadrill Partners had entered into restructuring proceedings and, as a result, we concluded that we no longer had significant influence over its financial and operating decisions as decisions now need court approval or are determined by the courts. Our investment in Seadrill Partners was therefore derecognized as an investment in associate and marketable security and recognized as an available-for-sale security at the closing carrying value of the equity investment in associate, being nil. Furthermore, on emergence from Chapter 11 in May 2021 Seadrill Partners (now Aquadrill) canceled the existing equity interests of their investors, including Seadrill Limited.
Investment in associated companies
As at June 30, 2021 and December 31, 2020, the carrying values of our investments in associated companies were as follows.

(In $ millions)As at June 30, 2021As at December 31, 2020
Seabras Sapura108 103 
Shareholder loans provided to Seabras Sapura115 121 
Sonadrill23 22 
Gulfdrill2 2 
Total investment in associated companies248 248 
v3.21.2
Drilling units
 6 Months Ended
Jun. 30, 2021
Property, Plant and Equipment [Abstract]  
Drilling units Drilling units
The following table summarizes the movement for the six months ended June 30, 2020:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 20207,048 (647)6,401 
Additions85 — 85 
Depreciation— (179)(179)
Impairment(1,230)— (1,230)
As at June 30, 20205,903 (826)5,077 
The following table summarizes the movement for the six months ended June 30, 2021:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 20213,108 (988)2,120 
Additions39 — 39 
Depreciation— (80)(80)
Impairment(152)— (152)
As at June 30, 20212,995 (1,068)1,927 
In March 2020 we recorded a $1,230 million impairment in our fleet, while in June 2021 we recorded a $152 million impairment. Refer to Note 9 – "Impairment of long-lived assets" for further information.
v3.21.2
Equipment
 6 Months Ended
Jun. 30, 2021
Property, Plant and Equipment [Abstract]  
Equipment Equipment
Equipment consists of office equipment, software, furniture and fittings.

The following table summarizes the movement for the six months ended June 30, 2020:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 202038 (15)23 
Depreciation— (3)(3)
As at June 30, 202038 (18)20

The following table summarizes the movement for the six months ended June 30, 2021:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 202139 (20)19 
Depreciation— (3)(3)
As at June 30, 202139 (23)16 
v3.21.2
Debt
 6 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Debt Debt
As at June 30, 2021 and December 31, 2020, we had the following liabilities for third party debt agreements:
(In $ millions)As at June 30, 2021As at December 31, 2020
Secured credit facilities5,662 5,662 
Senior Secured Notes546 515 
Total debt principal6,208 6,177 
Less: Debt balance held as subject to compromise(5,662)— 
Debt balance not subject to compromise546 6,177 

Key changes to borrowing facilities

Chapter 11 filing
Certain subsidiaries filed for Chapter 11 bankruptcy protection on February 7, 2021 and February 10, 2021. As a result, the outstanding balance of the senior credit facilities were classified within liabilities subject to compromise ("LSTC") in our Consolidated Balance Sheet at June 30, 2021. For further information on our bankruptcy proceedings refer to Note 3 - "Chapter 11 Proceedings".

As Seadrill New Finance Limited and it's subsidiaries (the "NSNCo group") have not filed for Chapter 11 bankruptcy protection, the senior secured notes issued by the NSNCo group have not been reclassified to LSTC. As these notes are in default, due to non-payment of interest (see below), they have been classified as a current liability.

Non-payment of interest on senior secured notes
On January 15, 2021, additional notes were issued for $21 million of accrued payment-in-kind interest however, $10 million cash interest was not paid.

Debt maturities
The outstanding debt not subject to compromise, the senior secured notes with carrying value of $546 million, are in default and are therefore due.
v3.21.2
Other Liabilities
 6 Months Ended
Jun. 30, 2021
Payables and Accruals [Abstract]  
Other Liabilities Other Liabilities
As at June 30, 2021 and December 31, 2020, other liabilities included the following:
(In $ millions)As at June 30, 2021As at December 31, 2020
Uncertain tax provisions84 79 
Lease liabilities71 68 
Accrued expenses69 110 
Employee withheld taxes, social security and vacation payments43 47 
Contract liabilities31 31 
Accrued interest expense30 38 
Taxes payable36 29 
Unfavorable drilling contracts7 7 
Other liabilities9 27 
Total Other Liabilities380 436 

Other liabilities are presented in our Consolidated Balance Sheet as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Other current liabilities275 316 
Other non-current liabilities105 120 
Total Other Liabilities380 436 
v3.21.2
Leases
 6 Months Ended
Jun. 30, 2021
Leases [Abstract]  
Leases Leases
We have operating leases relating to our premises, the most significant being our offices in London, Liverpool, Oslo, Stavanger, Singapore, Houston, Rio de Janeiro and Dubai. In accordance with Topic 842, we record a lease liability and associated right-of-use asset for our portfolio of operating leases.

We continue to lease three of our benign environment jack-up rigs, West Castor, West Telesto and West Tucana, to our joint venture, Gulfdrill, for a contract with GDI in Qatar.

In March, 2020, Seadrill was awarded a contract to provide drilling services for 10 firm wells and 4 optional wells. To fulfill this contract Seadrill entered a charter agreement to lease the West Bollsta rig from Northern Ocean. The rig was mobilized and commenced operations in early October, 2020 after being available at the drill location in September, 2020. This operating lease arrangement resulted in the recognition of a lease liability and offsetting right of use asset.

For operating leases where we are the lessee, our future undiscounted cash flows as at June 30, 2021 are as follows:
(In $ millions)Future cash flows
July 1 - December 31, 202122 
Year ended December 31, 202251 
Year ended December 31, 20232 
Year ended December 31, 20241 
Year ended December 31, 2025 and thereafter— 
Total76 

The following table gives a reconciliation between the undiscounted cash flows and the related operating lease liability recognized in our Consolidated Balance Sheets as at June 30, 2021 and December 31, 2020:
(In $ millions)As at June 30, 2021As at December 31, 2020
Total undiscounted cash flows76 79 
Less: short term leases— — 
Less: discount(5)(11)
Operating lease liability71 68 
Of which:
Current67 51 
Non-current4 17 
The following table gives supplementary information regarding our lease accounting for the six months ended June 30, 2021 and six months ended June 30, 2020:
(In $ million)Six months ended June 30, 2021Six months ended June 30, 2020
Operating Lease Cost:
Operating lease cost5 4 
Short-term lease cost— — 
Total Lease cost5 4 
Other information:
Cash paid for amounts included in the measurement of lease liabilities - Operating Cash flows5 4 
Right-of-use assets obtained in exchange for operating lease liabilities during the period— — 
Weighted-average remaining lease term in months1228
Weighted-average discount rate29 %13 %

In November 2019, March 2020 and November 2020 we respectively leased the West Castor,West Telesto and West Tucana to Gulfdrill. The estimated future undiscounted cash flows on these leases as at June 30, 2021 are as follows:
(In $ millions)Future cash flows
July 1 - December 31, 202114 
Year ended December 31, 202228 
Year ended December 31, 202328 
Year ended December 31, 202421 
2024 and thereafter20 
Total111 
Leases Leases
We have operating leases relating to our premises, the most significant being our offices in London, Liverpool, Oslo, Stavanger, Singapore, Houston, Rio de Janeiro and Dubai. In accordance with Topic 842, we record a lease liability and associated right-of-use asset for our portfolio of operating leases.

We continue to lease three of our benign environment jack-up rigs, West Castor, West Telesto and West Tucana, to our joint venture, Gulfdrill, for a contract with GDI in Qatar.

In March, 2020, Seadrill was awarded a contract to provide drilling services for 10 firm wells and 4 optional wells. To fulfill this contract Seadrill entered a charter agreement to lease the West Bollsta rig from Northern Ocean. The rig was mobilized and commenced operations in early October, 2020 after being available at the drill location in September, 2020. This operating lease arrangement resulted in the recognition of a lease liability and offsetting right of use asset.

For operating leases where we are the lessee, our future undiscounted cash flows as at June 30, 2021 are as follows:
(In $ millions)Future cash flows
July 1 - December 31, 202122 
Year ended December 31, 202251 
Year ended December 31, 20232 
Year ended December 31, 20241 
Year ended December 31, 2025 and thereafter— 
Total76 

The following table gives a reconciliation between the undiscounted cash flows and the related operating lease liability recognized in our Consolidated Balance Sheets as at June 30, 2021 and December 31, 2020:
(In $ millions)As at June 30, 2021As at December 31, 2020
Total undiscounted cash flows76 79 
Less: short term leases— — 
Less: discount(5)(11)
Operating lease liability71 68 
Of which:
Current67 51 
Non-current4 17 
The following table gives supplementary information regarding our lease accounting for the six months ended June 30, 2021 and six months ended June 30, 2020:
(In $ million)Six months ended June 30, 2021Six months ended June 30, 2020
Operating Lease Cost:
Operating lease cost5 4 
Short-term lease cost— — 
Total Lease cost5 4 
Other information:
Cash paid for amounts included in the measurement of lease liabilities - Operating Cash flows5 4 
Right-of-use assets obtained in exchange for operating lease liabilities during the period— — 
Weighted-average remaining lease term in months1228
Weighted-average discount rate29 %13 %

In November 2019, March 2020 and November 2020 we respectively leased the West Castor,West Telesto and West Tucana to Gulfdrill. The estimated future undiscounted cash flows on these leases as at June 30, 2021 are as follows:
(In $ millions)Future cash flows
July 1 - December 31, 202114 
Year ended December 31, 202228 
Year ended December 31, 202328 
Year ended December 31, 202421 
2024 and thereafter20 
Total111 
v3.21.2
Common shares
 6 Months Ended
Jun. 30, 2021
Equity [Abstract]  
Common shares Common shares
Share capital as at December 31, 2020 and June 30, 2021 was as follows:

Issued and fully paid share capital $0.10 par value each
Shares$ millions
As at December 31, 2020100,384,435 10 
As at June 30, 2021100,384,435 10 
v3.21.2
Non-controlling interest
 6 Months Ended
Jun. 30, 2021
Noncontrolling Interest [Abstract]  
Non-controlling interest Non-controlling interest
Changes in redeemable non-controlling interest for the periods presented in this report were as follows:
(In $ millions)SFL VIEsSeadrill Nigeria Operations LimitedTotal
As at January 1, 2020140 11 151 
Net loss attributable to non-controlling interest (2)— (2)
Share buyback of Heirs Holding shares in Seadrill Nigeria Operations— (11)(11)
As at June 30, 2020138 — 138 

(In $ millions)SFL VIEsSeadrill Nigeria Operations LimitedTotal
As at January 1, 2021— — — 
As at June 30, 2021— — — 

SFL VIEs
In September 2020, we triggered an event of default that meant we were no longer the primary beneficiary of the SFL VIEs, resulting in their deconsolidation on December 15, 2020. This reduced the non-controlling interest balance for SFL to nil as at December 31, 2020.

Seadrill Nigeria Operations Limited

In February 2020, we paid $11 million to HH Global Alliance Investments Limited ("Heirs Holding") for an option to buy the non-controlling interest in one of our subsidiaries, Seadrill Nigeria Operations Limited, at any point in the future for a $1 purchase price. Seadrill Nigeria Operations Limited holds a 10% interest in our drillship West Jupiter. This reduced the non-controlling interest balance to nil as at June 30, 2020.
Redeemable non-controlling interest
Changes in redeemable non-controlling interest for the periods presented in this report were as follows:

(In $ millions) Asia Offshore Drilling Ltd
As at January 1, 202057 
Fair value adjustment(30)
Net loss attributable to redeemable non-controlling interest in the period(1)
As at June 30, 202026 

(In $ millions) Asia Offshore Drilling Ltd
As at January 1, 2021— 
As at June 30, 2021— 

On September 11, 2020, Mermaid, a 33.76% investor in AOD, which owns the benign environment jack-up rigs AOD 1, AOD 2 and AOD 3, served notice on Seadrill that it was exercising the put option that gave them the right to sell their non-controlling interest shares to Seadrill.
The exercise of the put option resulted in the increase of the ownership interest in AOD to 100% and de-recognition of the redeemable non-controlling interest from the Consolidated Balance Sheet. The fair value of the non-controlling interest of AOD was agreed at $31 million which was settled in cash by Seadrill.
v3.21.2
Redeemable non-controlling interest
 6 Months Ended
Jun. 30, 2021
Temporary Equity Disclosure [Abstract]  
Redeemable non-controlling interest Non-controlling interest
Changes in redeemable non-controlling interest for the periods presented in this report were as follows:
(In $ millions)SFL VIEsSeadrill Nigeria Operations LimitedTotal
As at January 1, 2020140 11 151 
Net loss attributable to non-controlling interest (2)— (2)
Share buyback of Heirs Holding shares in Seadrill Nigeria Operations— (11)(11)
As at June 30, 2020138 — 138 

(In $ millions)SFL VIEsSeadrill Nigeria Operations LimitedTotal
As at January 1, 2021— — — 
As at June 30, 2021— — — 

SFL VIEs
In September 2020, we triggered an event of default that meant we were no longer the primary beneficiary of the SFL VIEs, resulting in their deconsolidation on December 15, 2020. This reduced the non-controlling interest balance for SFL to nil as at December 31, 2020.

Seadrill Nigeria Operations Limited

In February 2020, we paid $11 million to HH Global Alliance Investments Limited ("Heirs Holding") for an option to buy the non-controlling interest in one of our subsidiaries, Seadrill Nigeria Operations Limited, at any point in the future for a $1 purchase price. Seadrill Nigeria Operations Limited holds a 10% interest in our drillship West Jupiter. This reduced the non-controlling interest balance to nil as at June 30, 2020.
Redeemable non-controlling interest
Changes in redeemable non-controlling interest for the periods presented in this report were as follows:

(In $ millions) Asia Offshore Drilling Ltd
As at January 1, 202057 
Fair value adjustment(30)
Net loss attributable to redeemable non-controlling interest in the period(1)
As at June 30, 202026 

(In $ millions) Asia Offshore Drilling Ltd
As at January 1, 2021— 
As at June 30, 2021— 

On September 11, 2020, Mermaid, a 33.76% investor in AOD, which owns the benign environment jack-up rigs AOD 1, AOD 2 and AOD 3, served notice on Seadrill that it was exercising the put option that gave them the right to sell their non-controlling interest shares to Seadrill.
The exercise of the put option resulted in the increase of the ownership interest in AOD to 100% and de-recognition of the redeemable non-controlling interest from the Consolidated Balance Sheet. The fair value of the non-controlling interest of AOD was agreed at $31 million which was settled in cash by Seadrill.
v3.21.2
Accumulated other comprehensive (loss)/income
 6 Months Ended
Jun. 30, 2021
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Accumulated other comprehensive (loss)/income Accumulated other comprehensive (loss)/income
Accumulated other comprehensive (loss)/income for the six months ended June 30, 2021 and June 30, 2020 were as follows:


(In $ millions) 
Actuarial loss relating to pensionShare in unrealized loss from associated companiesChange in debt component on Archer bondTotal
As at January 1, 2021 (2)(28)4 (26)
Other comprehensive income— 4 1 5 
As at June 30, 2021(2)(24)5 (21)

(In $ millions) 
Actuarial loss relating to pensionShare in unrealized loss from associated companiesChange in debt component on Archer bondTotal
As at January 1, 2020— (13)— (13)
Other comprehensive (loss)/income(7)(17)2(22)
As at June 30, 2020(7)(30)2 (35)
Income taxes associated with each component of other comprehensive income were nil for the six months ended June 30, 2021 (June 30, 2020: $2 million).
v3.21.2
Risk management and financial instruments
 6 Months Ended
Jun. 30, 2021
Derivative Instruments and Fair Value Disclosures [Abstract]  
Risk management and financial instruments Risk management and financial instruments
We are exposed to several market risks, including credit risk, foreign currency risk and interest rate risk. Our policy is to reduce our exposure to these risks, where possible, within boundaries deemed appropriate by our management team. This may include the use of derivative instruments.

Credit risk
We have financial assets, including cash and cash equivalents, marketable securities, other receivables and certain amounts receivable on derivative instruments. These assets expose us to credit risk arising from possible default by the counterparty. Most of our counterparties are creditworthy financial institutions or large oil and gas companies. We do not expect any significant loss to result from non-performance by such counterparties. However, we are exposed to a higher level of credit risk on certain related party receivable balances. Please refer to Note 4 - "Current expected credit losses" for details of allowances established for credit losses.

We do not demand collateral in the normal course of business. The credit exposure of derivative financial instruments is represented by the fair value of contracts with a positive fair value at the end of each period, adjusted for our non-performance credit risk assumption.

Concentration of risk 
There is a concentration of credit risk with respect to cash and cash equivalents to the extent that most of the amounts are carried with Citibank, Nordea Bank Abp (Filial i Norge), Danske Bank A/S, BTG Pactual and DNB Bank ASA. We consider these risks to be remote. We also have a concentration of risk with respect to customers. For details on the customers with greater than 10% of total revenues, refer to Note 5 - "Segment information".

Foreign exchange risk
As is customary in the oil and gas industry, most of our revenues and expenses are denominated in U.S. dollars, which is the functional currency of most of our subsidiaries and equity method investees. However, a portion of the revenues and expenses of certain of our subsidiaries and equity method investees are denominated in other currencies. We are therefore exposed to foreign exchange gains and losses that may arise on the revaluation or settlement of monetary balances denominated in foreign currencies.

Our foreign exchange exposure primarily relates to foreign denominated cash and working capital balances. Historically, these exposures have not caused a significant amount of fluctuation in net income or cash flows and therefore we have not hedged them.

Interest rate risk
Our exposure to interest rate risk relates mainly to our floating rate debt and balances of surplus funds placed with financial institutions. We manage this risk through the use of derivative arrangements.

On May 11, 2018, we purchased an interest rate cap for $68 million to mitigate our exposure to future increases in LIBOR on our Senior Credit Facility debt. The interest rate cap is not designated as a hedge and we do not apply hedge accounting. The capped rate against the 3-month US LIBOR is 2.87% and covers the period from June 15, 2018 to June 15, 2023.

Due to the LIBOR rate being below the capped rate as at June 30, 2021, the instrument has minimal value and is considered ineffective.

We have set out our exposure to interest rate risk at June 30, 2021 in the table below(1):
(In $ millions)As at June 30, 2021Impact of 1% increase in rates
Cash and Restricted Cash644 6 
(1) Debt instruments have been excluded above as:
- We have not paid any interest on the $5,662 million of senior credit facilities since filing for Chapter 11;
- The $546 million of senior secured notes are a fixed rate debt instrument.

Gains and losses on derivatives reported in Consolidated Statement of Operations
Gains and losses on derivatives reported in our Consolidated Statement of Operations included the following:

Gain/(loss) recognized in the Consolidated Statement of Operations relating to derivative financial instrumentsSix months ended June 30, 2021Six months ended June 30, 2020
Interest rate cap agreement—(2)
Embedded conversion option on Archer convertible debt instrument5 3
Gain on derivative financial instruments5 1 

Interest rate cap - This represents changes in fair value on our interest rate cap agreement referred above.

Embedded conversion option on Archer convertible debt instrument - This represents gains on the conversion option included within a $45 million convertible bond issued to us by Archer. Please see Note 28 – "Related party transactions" for further details.
Derivative financial instruments included in our Consolidated Balance Sheet
Derivative financial instruments included in our Consolidated Balance Sheet, within "Other Assets" included the following:
(In $ millions)Maturity dateApplicable rateOutstanding principal - June 30, 2021As at June 30, 2021As at December 31, 2020
Interest rate capJune 2023
2.87% LIBOR cap
3,500 — — 

Fair values of financial instruments

Fair value of financial instruments measured at amortized cost
The carrying value and estimated fair value of our financial instruments that are measured at amortized cost at June 30, 2021 and December 31, 2020 are as follows:
As at June 30, 2021As at December 31, 2020
(In $ millions)Fair
value		Carrying
value		Fair
value		Carrying
value
Assets
Related party loans receivable (1) (Level 2)
391 391 379 379 
Liabilities
Secured credit facilities (Level 3)1,213 5,662 1,193 5,662 
Senior Secured Notes (Level 1)306 546 213 515 
Related party loans payable (Level 3)370 635 424 426 

(1)         Excludes Archer convertible debt receivable, which is measured at fair value on a recurring basis.  Related party loans receivable is $198 million, comprised of principal due of $540 million offset by allowance for expected credit losses recognized of $342 million. For further information on the impact of the expected credit losses to our financial assets please refer to Note 4 - "Current expected credit losses".

Level 1
The fair value of the senior secured notes were derived using market traded value. We have categorized this at level 1 on the fair value measurement hierarchy. Refer to Note 20 – "Debt" for further information.

Level 2
The fair value of our related party loans receivable from SeaMex and Seabras Sapura is estimated to be equal to the carrying value after adjusting for expected credit losses on the loans. The 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. The loans are categorized as level 2 on the fair value hierarchy.
Other trading balances with related parties are not shown in the table above and are covered in Note 28 - "Related party transactions". The fair value of other trading balances with related parties are also assumed to be equal to their carrying value after adjusting for expected credit losses on the receivables.

Level 3
The fair values of the secured credit facilities as at June 30, 2021 and December 31, 2020 are determined by reference to the fair value of the collateral of each facility, the rigs, as this is the expected amount recoverable on enforcement of an event of default as well as the sales price of rigs that are contractually estimated to be sold in the second half of 2021. The same methodology has been applied to calculate the fair value of the related party loans as at June 30, 2021. The fair values were derived using a discounted cash flow model of future free cash flows from each rig, using a weighted average cost of capital of 11.8%. We have categorized this at level 3 of the fair value hierarchy. Refer to Note 20 - "Debt" for further information.

The fair values of the related party loans payable as at December 31, 2020 were derived using a discounted cash flow model of future free cash flows based on the contractual cash flows under the bareboat charter agreement together with the LIBOR linked interest payments, as well as assumed cash outflows under the mandatory repurchase obligation at the end of the lease term. These cash flows were discounted using the Senior Secured Note yield of 37%. We have categorized this at level 3 on the fair value hierarchy. Refer to Note 28 - "Related party transactions" for further information.
Financial instruments measured at fair value on a recurring basis
The carrying value and estimated fair value of our financial instruments that are measured at fair value on a recurring basis at June 30, 2021 and December 31, 2020 are as follows:
 As at June 30, 2021As at December 31, 2020
(In $ millions)Fair
value		Carrying
value		Fair
value		Carrying
value
Assets
Cash and cash equivalents (Level 1)
428 428 526 526 
Restricted cash (Level 1)
216 216 197 197 
Marketable securities (Level 1)
13 13 8 8 
Related party loans receivable - Archer convertible debt (Level 3)
19 19 13 13 

Level 1
The carrying value of cash and cash equivalents and restricted cash, which are highly liquid, was a reasonable estimate of fair value and categorized at level 1 on the fair value measurement hierarchy. Quoted market prices were used to estimate the fair value of marketable securities, which were valued at fair value on a recurring basis.

Level 3
The Archer convertible debt instrument is bifurcated into two elements. The fair value of the embedded derivative option was 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 was derived using the discounted cash flow model including assumptions relating to cost of debt and credit risk associated to the instrument.
v3.21.2
Related party transactions
 6 Months Ended
Jun. 30, 2021
Related Party Transactions [Abstract]  
Related party transactions Related party transactions
Our main related parties include (i) affiliated companies over which we hold significant influence, (ii) affiliated companies and (iii) companies who are either controlled by or whose operating policies may be significantly influenced by our major shareholder, Hemen.

Companies over which we hold significant influence include SeaMex, Seabras Sapura, Sonadrill and Gulfdrill. Aquadrill (formerly Seadrill Partners) was an affiliated company until it emerged from Chapter 11 in May 2021. Companies that are controlled by, or whose operating policies may be significantly influenced by, Hemen include SFL, Archer, Frontline, Seatankers, Northern Drilling and Northern Ocean. In the following sections we provide an analysis of transactions with related parties and balances outstanding with related parties.

Related party revenue

The below table provides an analysis of related party revenues for periods presented in this report.
 (In $ millions)
Six months ended June 30, 2021Six months ended June 30, 2020
Management fees revenues (a)55 76 
Reimbursable revenues (b)29 100 
Related party inventory sales — 1 
Total related party operating revenues84 177 

(a) We provide management and administrative services to Aquadrill, SeaMex and Sonadrill and operational and technical support services to Aquadrill, SeaMex, Sonadrill and Northern Ocean. We charge our affiliates for support services provided either on a cost-plus mark-up or dayrate basis.

(b) We recognized reimbursable revenues from Northern Ocean for work to perform the first mobilization of the Northern Ocean rigs, West Mira and West Bollsta. As at June 30, 2021, our Consolidated Balance Sheet included $157 million of receivables from Northern Ocean (December 31, 2020: $142 million), before deducting allowances for credit losses. This included $152 million of billed and unbilled trade receivables (December 31, 2020: $137 million), which have been classified within the line item "amount due from related parties", and $5 million of costs incurred not yet billable to Northern Ocean (December 31, 2020: $5 million), which have been classified within "Other Assets".
Related party operating expenses

The below table provides an analysis of related party operating expenses for periods presented in this report.

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Other related party operating expenses (c)2 — 
West Bollsta lease (d)
21 — 
Total related party operating expenses23 — 

(c) We received services from certain other related parties. These included management and administrative services from Frontline, warehouse rental from Seabras Sapura and other services from Archer and Seatankers.

(d) Seadrill entered a charter agreement to lease the West Bollsta rig from Northern Ocean in 2020. Refer to Note 22 – "Leases" for details.

Related party financial items

The below table provides an analysis of related party financial income for periods presented in this report.

 (In $ millions)
Six months ended June 30, 2021Six months ended June 30, 2020
Interest income (e)10 12 
Total related party financial items10 12 

(e) We earn interest income on our related party loans to SeaMex and Seabras Sapura (see below).

Related party receivable balances

The below table provides an analysis of related party receivable balances for periods presented in this report.
(In $ millions)As at June 30, 2021As at December 31, 2020
Related party loans and interest (f)540 516 
Deferred consideration arrangements (g)— 3 
Convertible bond (h)19 13 
Trading balances (i)193 251 
Allowance for expected credit losses (j)(292)(306)
Total related party receivables460 477 
Of which:
Amounts due from related parties - current50 85 
Amounts due from related parties - non-current410 392 

(f) We have loan receivables outstanding from SeaMex and Seabras Sapura. We have summarized the amounts outstanding in the table below:
(In $ millions)As at June 30, 2021As at December 31, 2020
SeaMex seller's credit and loans receivable485 452 
Seabras loans receivable55 64 
Total related party loans and interest540 516 

SeaMex loans include:
(1) $250 million "sellers credit" provided to SeaMex in March 2015 which matured in December 2019 but is subordinated to SeaMex's external debt facility, which matures in March 2022. As such, we have classified this balance as non-current on our Consolidated Balance Sheets.
(2) $45 million working capital loan advanced to SeaMex in November 2016.
(3) $158 million accrued interest on above loans and other funding. The sellers credit and working capital loan both earn interest at 6.5% and are subordinated to SeaMex's external debt facility.
(4) $23 million loan issued to SeaMex in March 2021 and April 2021. The loan incurs interest at base rate of the Federal Reserve System.
(5) $9 million Sponsor Minimum Liquidity Shortfall. The loan earns interest at 6.5% plus 3-month US LIBOR.
Seabras loans include a series of loan facilities that we extended to Seabras Sapura between May 2014 and December 2016. The $55 million balance shown in the table above includes (i) $41 million of loan principal and (ii) $14 million of accrued interest. The loans are repayable on demand, subject to restrictions on Seabras Sapura's external debt facilities. We earn interest of between 3.4% - LIBOR plus 3.99% on the loans, depending on the facility.

In addition to the Seabras loans above, we have made certain other shareholder loans to Seabras Sapura, which we classify as part of our equity method investment in Seabras Sapura. See Note 17 – "Investment in associated companies" for further details.

Seabras Sapura repaid $16 million of its outstanding loan balances in April 2021, $10 million relating to its loan facility and $6 million relating to its shareholder loans.

(g) Deferred consideration arrangements included receivables due to us from Aquadrill from the sale of the West Vela and the West Polaris to Aquadrill in November 2014 and June 2015, respectively. We have summarized amounts due for each period in the table below:
(In $ millions)As at June 30, 2021As at December 31, 2020
West Vela - Mobilization receivable
— 2 
West Vela - Share of dayrate
— 1 
Total deferred consideration receivable— 3 

On adoption of fresh start accounting, we recorded receivables for West Vela share of dayrate and West Polaris earnout. These amounts were previously accounted for as gain contingencies recognized only when realized. The receivables were recognized at fair value of $29 million and $1 million respectively and the gain was recognized in reorganization items. The West Polaris was settled in 2019.

As part of the settlement agreement with Aquadrill, which waived all claims on pre-petition positions held, the deferred consideration due from Aquadrill was written-off as at June 30, 2021.

(h) On April 26, 2017, we converted $146 million, including accrued interest and fees, in subordinated loans provided to Archer into a $45 million convertible loan. The loan incurred interest at 5.5% and was to mature in December 2021, with a conversion right into equity of Archer Limited in 2021. At inception, the fair value of the convertible bond was $56 million whereas the previous loan had a carrying value of $37 million. We therefore recognized a gain on debt extinguishment of $19 million in 2017.

The loan receivable is a convertible debt instrument comprised of a debt instrument and a conversion option, classed as an embedded derivative. Both elements are measured at fair value at each reporting date.

On March 13, 2020, Archer announced completion of a refinancing, which included agreed renegotiated terms on the convertible loan. The updated terms amended the loan balance to $13 million that bears interest of 5.5%, matures in April 2024 and an equity conversion option. The renegotiated terms resulted in a $29 million impairment being recognized following a reduction in loan balance and an increase to the discount rate. The fair value of the convertible debt instrument as at June 30, 2021 was $19 million of which the split between debt and embedded derivative option was $11 million and $8 million respectively.

(i) Trading balances primarily comprise receivables from SeaMex, Northern Ocean and Sonadrill for related party management fees, crewing fees and payroll recharges. Per our contractual terms these balances are either settled monthly or quarterly in arrears, or in certain cases, in advance. After its emergence from Chapter 11 in May 2021, Aquadrill is no longer considered a related party and any amounts due from them have been reclassified to "Accounts receivable, net" in our Consolidated Balance Sheets. As set out below, we have established credit loss allowances for balances that have not been settled in line with these payment terms and are overdue.

(j) Allowances recognized for expected credit losses on our related party loan and trade receivables following adoption of accounting standard update 2016-13 - Measurement of Credit Losses on Financial Instruments. Refer to Note 4 – "Current expected credit losses" for further information.

Related party payable balances

Related party liabilities are presented in our Consolidated Balance Sheets as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Liabilities from Seadrill to SFL SPVs (k)635 426 
Trading balances (l)— 7 
Total related party liabilities635 433 
Of which:
Amounts due to related parties - current— 7 
Long-term debt due to related parties— 426 
Liabilities subject to compromise635— 
On filing for Chapter 11, our pre-petition related party payables are held within "liabilities subject to compromise" in our Consolidated Balance Sheets at June 30, 2021. For further information on our bankruptcy proceedings refer to Note 3 – "Chapter 11 Proceedings" of our Consolidated Financial Statements included herein.

(k) Following the deconsolidation of the SFL SPVs in 2020, we recognized the liability between Seadrill and the SPVs that was previously eliminated on consolidation. The increase in the liability is due to the remeasurement loss recognized for the lease of the West Taurus of $186 million to claim value as the lease was terminated, unwinding of the discount of debt of $54 million offset by payments made of $31 million for the six months ended June 30, 2021.

The following table gives a summary of the sale and leaseback arrangements and repurchase options with SFL, as at June 30, 2021:

(In $ millions)West TaurusWest HerculesWest LinusTotal
Maturity dateDec 2024Dec 2024May 2029
Remaining lease payments— 167373540 
Purchase obligation— 13886224 
Total commitment— 305459764 
Fair value on initial recognition146 136142424 
Book value345 143147635 

The purchase price paid by the SFL SPVs was $850 million (West Taurus - Nov 2008), $850 million (West Hercules - Oct 2008) and $600 million (West Linus - June 2013).

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 average bareboat charter rates per day for the remaining two units is given below for the respective years.

(In $ thousands)20212022202320242025 and thereafter
West Hercules9696183176—
West Linus9992189153122

(l) Trading balances in 2020 primarily included related party payables due to SeaMex and Aquadrill. As part of the settlement agreement with Aquadrill which waived all claims on pre-petition positions held, $8 million due to Aquadrill was written-off as a gain to "Reorganization items" in our Consolidated Statement of Operations for the six months ended June 30, 2021.

Other related party transactions

Seabras Sapura guarantees - 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, but this facility matured in March 2020. 

As a condition to the lenders making the loan available, a subsidiary of Seadrill has provided a sponsor guarantee, on a joint and several basis with the joint venture partner, Sapura Energy, in respect of the obligations of the borrower. The total amount guaranteed by the joint venture partners as at June 30, 2021 was $130 million (December 31, 2020: $132 million).

Performance guarantees - In addition, we have made certain guarantees over the performance of SeaMex, Northern Ocean and Sonadrill on behalf of customers.

We have not recognized a liability for any of the above guarantees as we did not consider it to be probable that the guarantees would be called.
v3.21.2
Commitments and contingencies
 6 Months Ended
Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]  
Commitments and contingencies Commitments and contingencies
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 results. Our best estimate of the outcome of the various disputes has been reflected in our Consolidated Financial Statements as at June 30, 2021.

Dalian Newbuilds
As at June 30, 2021, all eight of the newbuilding contracts with Dalian had been terminated by both parties. Accordingly, the Seadrill contracting entities had no contractual obligation to take delivery of the rigs.

In January 2019, Dalian appointed an administrator to restructure its liabilities. In March 2019, the Seadrill contracting parties commenced arbitration proceedings in London for all eight rigs and will claim for the return of the paid installments plus interest and further damages for losses.

The Seadrill contracting parties have filed their claims against Dalian in the Dalian insolvency and the administrator is currently considering whether to accept or reject the claims in the insolvency. The arbitrations are currently not being progressed by agreement of the parties, pending the insolvency administrator's decision whether to accept or reject the Seadrill contracting parties' claims. Dalian has stated that it has claims for damages in respect of each of the rigs, but it has not quantified those damages. The administrator convened a creditor’s meeting on December 23, 2020 for a vote on the draft reorganization plan that was submitted to the insolvency court. The first and second round of voting on the reorganization plan subsequently failed. On 30 June 2021 the reorganisation plan was approved by the insolvency court. The Seadrill contracting parties’ claims remain pending for rejection or approval by the administrator.

The newbuilding contracts are all with limited liability subsidiaries of Seadrill. There are no parent company guarantees.

Nigerian Cabotage Act litigation

Seadrill Mobile Units Nigeria Ltd (“SMUNL”) commenced proceedings in May 2016 against the Honourable Minister for Transportation, the Attorney General of the Federation and the Nigerian Maritime Administration and Safety Agency with respect to interpretation of the Coastal and Inland Shipping (Cabotage) Act 2003 (the “Act”). On June 28, 2019, the Federal High Court of Nigeria delivered a judgement finding that: (1) Drilling operations fall within the definition of “Coastal Trade” or “Cabotage” under the Act and (2) Drilling Rigs fall within the definition of "Vessels" under the Act. The impact of this decision is that the Nigerian Maritime Administration and Safety Agency (“NIMASA”) may impose a 2% surcharge on contract revenue from offshore drilling operations in Nigeria as well as requiring SMUNL register for Cabotage with NIMASA and pay all fees and tariffs as may be published in the guidelines that may be issued by the Minister of Transportation in accordance with the Act. However, on 22 July, 2019, SMUNL filed an appeal to the Court of Appeal challenging the decision of the Federal High Court. Due to the volume of cases currently being handled by the Court of Appeal sitting in Lagos we anticipate a decision within 3-5 years.

Although we intend to strongly pursue this appeal, we cannot predict the outcome of this case. We do not believe that it is probable that the ultimate liability, if any, resulting from this litigation will have a material effect on our financial position. Accordingly, no loss contingency has been recognized within the Consolidated Financial Statements.

Oro Negro

Oro Negro, a Mexican drilling rig contractor, filed a Complaint on June 6, 2019 in the United States Bankruptcy Court, Southern District of New York, within Chapter 15 proceedings ancillary to its Mexican insolvency process. The Complaint names Seadrill and its Seamex JV partner, Fintech Advisory, Inc, as co-defendants along with other defendants including Oro Negro bondholders. With respect to Seadrill, the Complaint asserts claims relating to alleged tortious interference but does not seek to quantify damages. On August 26, 2019, we submitted a motion to dismiss the Complaint on technical legal grounds. Gil White, the CEO of Oro Negro responded to this motion on October 25, 2019. Seadrill has the opportunity to reply to this in further support of the motion, the date of which has not yet been determined. We intend to vigorously defend against the claims Oro Negro asserts and dispute the allegations set forth in the Complaint. The Foreign Representative of Oro Negro filed a notice on 23 July 2021 disclosing that the court in Mexico has authorized him to go forward with the sale of Oro Negro’s assets. The action remains stayed until an offer to purchase is either accepted or rejected.

Other contingencies

Sevan Louisiana loss incident

In January 2019, there was a loss incident on the Sevan Louisiana related to a malfunction of its subsea equipment. As at June 30, 2021, we have incurred $23 million of costs to repair the equipment. There is a $1.3 million deductible on the insurance policy. As at June 30, 2021 $15.3 million has been recovered and an additional $6.4 million will be recoverable under our physical damage insurance.

The loss incident resulted in a period of downtime for the Sevan Louisiana. As a result, we have recovered $19 million insurance income from loss of hire of the Sevan Louisiana as at December 31, 2020. The loss of hire claim is now closed.
v3.21.2
Subsequent Events
 6 Months Ended
Jun. 30, 2021
Subsequent Events [Abstract]  
Subsequent Events Subsequent Events
Chapter 11 process

Negotiations on the comprehensive restructuring continued with the lenders until July 24, 2021 when Seadrill Limited entered into a PSA with the majority of the Company’s senior secured lenders as well as a backstop commitment letter entered into with certain of the Consenting Lenders. The agreements contemplate a Plan of Reorganization that will raise $350 million in new financing and reduce the Company’s liabilities by over $5 billion. The POR provides a clear pathway for Seadrill to restructure its balance sheet. See Note 1 - "General information" for further details.
Seadrill New Finance Limited and subsidiaries

On January 15, 2021 Seadrill New Finance Limited (“NSNCo”), a subsidiary holding company of Seadrill Limited, elected to default on its semi-annual interest payment in relation to its 12.0% senior secured notes due in 2025 (the “Notes”). Discussions with the 12.0% senior secured note holders due 2025 (the “Noteholders”) continued to be on-going with regards the terms of a comprehensive restructuring of the debt facility until a Restructuring Support Agreement (“RSA”) was reached with the Noteholders on July 2, 2021. NSNCo then entered a solicitation process that concluded on July 9, 2021 with 80% of the principal Noteholders approving amendments to the indenture governing the Notes.

Pursuant to the RSA, the consenting Noteholders have also agreed to forbear from exercising enforcement rights or otherwise take actions against the Issuer and any subsidiary of the Issuer which is an obligor under the Notes in respect of certain events of default that may arise under the Notes, including in respect of the Issuer not making the semi-annual cash interest payments due to the Noteholders on January 15, 2021 and July 15, 2021, until the earlier of the completion of the restructuring transactions described therein and termination of the RSA.

Effective July 9, 2021, NSNCo entered into a supplemental indenture related to the Notes. The amendment permits NSNCo to use repayments made on the Notes, previously held as restricted cash, to fund reorganization expenses and to advance funds to SeaMex Ltd to meet their ongoing operating and administrative needs.
Northern Ocean settlement

On August 8, 2021 we reached a settlement agreement with Northern Ocean Ltd (“NOL”) predominantly with respect to balances outstanding from our preparation of the West Mira and West Bollsta . The settlement agreement closes all outstanding balances, claims and counter-claims between the companies and their respective subsidiaries by way of set-off as full and final settlement. Further, the settlement agreement sets out that we will provide certain transition services to any prospective new managers in respect of NOL’s rigs and requires us to restart bareboat lease payments for the West Bollsta from August 10, 2021, alongside our continued operation of the rig on the Lundin contract.

The settlement agreement is subject to certain conditions, including, but not limited to, obtaining approval by the US bankruptcy court under our Chapter 11 protection.

West Hercules Charter arrangement

In August 2021 there was an amendment to the West Hercules Charter agreement, removing the existing call options and purchase obligations. Upon final agreement of this amendment, expected in the second half of 2021, the lease will fail to qualify as a capital lease, triggering a disposal of the rig.

West Freedom disposal

The West Freedom was sold to New Fortress Energy Fast LNG Operations LLC for $5 million on July 2, 2021. As the rig was fully impaired in 2020 the total consideration will be recognized as a gain on disposal in the second half of the year.
v3.21.2
Recent accounting pronouncements (Policies)
 6 Months Ended
Jun. 30, 2021
Accounting Changes and Error Corrections [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, its 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 (though not directly or indirectly holding more than 50% of the voting control).
The accompanying unaudited interim financial statements, in the opinion of management, include all material 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, 2020 (SEC File No. 333-224459).
Bankruptcy accounting Bankruptcy accountingWe have operated as a debtor-in-possession from February 10, 2021. We have prepared our Consolidated Financial Statements under Accounting Standards Codification 852, Reorganizations ("ASC 852"). ASC 852 requires that the financial statements 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 were realized or incurred in the bankruptcy proceedings are recorded in “Reorganization items" on our Consolidated Statements of Operations. In addition, ASC 852 requires changes in the accounting and presentation of significant items on the Consolidated Balance Sheets, particularly liabilities. Pre-petition obligations that may have been impacted by the Chapter 11 reorganization process have been classified on the Consolidated Balance Sheets within "Liabilities subject to compromise". For details of the Chapter 11 process, refer to Note 3 - "Chapter 11 Proceedings".
Use of Estimates
Use of Estimates

The preparation of our consolidated financial statements requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenues and expenses and related disclosure of contingent assets and liabilities. The full extent to which the COVID-19 pandemic will directly or indirectly impact our business, results of operations and financial condition, including sales, expenses and reserves and allowances will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain it or treat COVID-19, as well as the economic impact on local, regional, national and international customers and markets. We have made estimates of the impact of COVID-19 within our financial statements and there may be changes to those estimates in future periods. Actual results may differ from these estimates.
Recently adopted and issued accounting standards
Recently adopted accounting standards

We have not adopted any new accounting standard updates ("ASUs") since the reporting date of our Form 20-F report.

Other ASUs

We additionally adopted the following accounting standard updates in the year which did not have any material impact on our Consolidated Financial Statements and related disclosures:
ASU 2019-12 Income Taxes (Topic 740): Simplifying the accounting for income taxes

In December 2019, the FASB issued ASU 2019-12. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The guidance will be effective from January 1, 2021 on a mainly prospective basis, with early adoption permitted. This amendment had no material impact on our consolidated financial statements or related disclosures.

Recently issued accounting standards

The FASB issued the following ASUs that we have not yet adopted but which could affect our Consolidated Financial Statements and related disclosures in future periods:

ASU 2020-04 & ASU 2021-01 Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). This update is intended to provide relief to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022. We are in the process of evaluating the impact of this standard update on our Consolidated Financial Statements and related disclosures.

In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848). The amendments in this Update are elective and apply to all entities that have derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. The amendments in this update do not apply to contract modifications made after December 31, 2022. We are in the process of evaluating the impact of this standard update on our Consolidated Financial Statements and related disclosures.

ASU 2020-06 Debt with Conversion and Other Options and Hedging - Contracts in Entity's Own Equity

In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) which simplifies the accounting for convertible instruments, such as exchangeable debt, by limiting the accounting models that result in separately recognizing embedded conversion features from the host contract. The accounting standards update also enhances information transparency by making targeted improvements to the disclosures for convertible instruments and earnings-per-share guidance. Update 2020-06 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted. We are in the process of evaluating the impact this amendment will have on our Consolidated Financial Statements and related disclosures.
Revenue from contracts with customers Deferred revenue - The deferred revenue balance of $24 million reported in "Other current liabilities" at June 30, 2021 is expected to be realized within the next twelve months and $7 million reported in "Other non-current liabilities" is expected to be realized within the following twelve months. The deferred revenue included consists primarily of 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.
Leases
Credit risk and concentration of risk We have financial assets, including cash and cash equivalents, marketable securities, other receivables and certain amounts receivable on derivative instruments. These assets expose us to credit risk arising from possible default by the counterparty. Most of our counterparties are creditworthy financial institutions or large oil and gas companies. We do not expect any significant loss to result from non-performance by such counterparties. However, we are exposed to a higher level of credit risk on certain related party receivable balances. Please refer to Note 4 - "Current expected credit losses" for details of allowances established for credit losses.
Foreign exchange risk
Foreign exchange risk
As is customary in the oil and gas industry, most of our revenues and expenses are denominated in U.S. dollars, which is the functional currency of most of our subsidiaries and equity method investees. However, a portion of the revenues and expenses of certain of our subsidiaries and equity method investees are denominated in other currencies. We are therefore exposed to foreign exchange gains and losses that may arise on the revaluation or settlement of monetary balances denominated in foreign currencies.
Our foreign exchange exposure primarily relates to foreign denominated cash and working capital balances. Historically, these exposures have not caused a significant amount of fluctuation in net income or cash flows and therefore we have not hedged them.
Interest rate risk Interest rate riskOur exposure to interest rate risk relates mainly to our floating rate debt and balances of surplus funds placed with financial institutions. We manage this risk through the use of derivative arrangements.
v3.21.2
Chapter 11 Proceedings (Tables)
 6 Months Ended
Jun. 30, 2021
Reorganizations [Abstract]  
Schedule of liabilities subject to compromise
Liabilities subject to compromise, as presented on the Consolidated Balance Sheet as at June 30, 2021, include the following:

(In $ millions)As at June 30, 2021
Senior under-secured external debt5,662 
Accounts payable and other liabilities75 
Accrued interest on external debt34 
Amount due to related party645 
Liabilities subject to compromise in combined filers6,416 
Less: Elimination of positions held with non-filers within the Seadrill Consolidated Group(10)
Liabilities subject to compromise in consolidated group6,406 
Schedule of reorganization items The following table summarizes the reorganization items recognized in the six months ended June 30, 2021:
(In $ millions)Six months ended June 30, 2021
Advisory and professional fees after filing(52)
Remeasurement of terminated lease to allowable claim(186)
Gain on write-off of related party balances8 
Total reorganization items(230)
Schedule of Debtor-In Possession Financial Statements
Debtors' unaudited combined Statement of Operations for the six months ended June 30, 2021

(In $ millions)Six months ended June 30, 2021
Operating revenues
Contract revenues335 
Reimbursable revenues17 
Management contract revenues88 
Other revenues12 
Total operating revenues452 
Operating expenses
Vessel and rig operating expenses(316)
Reimbursable expenses(16)
Management contract expense(118)
Depreciation(83)
General and administrative expenses(36)
Total operating expenses(569)
Other operating items
Loss on impairment of long-lived assets(152)
Gain on sale of assets11 
Other operating income3 
Total other operating items(138)
Operating loss(255)
Financial and other non-operating items
Interest income1 
Total Interest expenses(79)
Share in results of joint ventures1 
Foreign currency exchange gain9 
Other financial items(13)
Reorganization items(230)
Total financial and other non-operating items, net(311)
Loss before income taxes(566)
Income tax expense(9)
Net loss(575)
Debtors' unaudited combined Balance Sheet as at June 30, 2021

(In $ millions)As at June 30,
2021
ASSETS 
Current assets 
Cash and cash equivalents414 
Restricted cash78 
Accounts receivable, net122 
Amounts due from related parties, net81 
Other current assets185 
Total current assets880 
Non-current assets 
Investment in associated companies and joint ventures25 
Drilling units1,927 
Shares in subsidiaries409 
Restricted cash69 
Deferred tax assets8 
Equipment16 
Amount due from related party, net3 
Other non-current assets32 
Total non-current assets2,489 
Total assets3,369 
LIABILITIES AND EQUITY 
Current liabilities 
Trade accounts payable(56)
Short-term debt due to related party(1)
Other current liabilities(239)
Total current liabilities(296)
Liabilities subject to compromise(6,416)
Non-current liabilities 
Deferred tax liability(8)
Other non-current liabilities(105)
Total non-current liabilities(113)
Equity 
Total equity3,456 
Total liabilities and equity(3,369)
Debtors' unaudited Statement of Cash Flows for the six months ended June 30, 2021

(In $ millions)Six months ended June 30, 2021
Cash Flows from Operating Activities 
Net loss(575)
 Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation83 
Gain on sale of assets(11)
Share in results from joint ventures (net of tax)(1)
Loss on impairment of long-lived assets152 
Deferred tax benefit(1)
Non-cash reorganization items178 
Unrealized foreign exchange gain(4)
Change in allowance for credit losses54 
Other cash movements in operating activities
Payments for long-term maintenance(26)
Repayments made under lease arrangements(12)
Changes in operating assets and liabilities, net of effect of acquisitions and disposals
Trade accounts receivable3 
Trade accounts payable14 
Related party receivables— 
Related party payables28 
Other assets11 
Other liabilities45 
Net cash flows used in operating activities(62)
Cash Flows from Investing Activities
Additions to drilling units and equipment(13)
Proceeds from disposal of drilling unit7 
Net cash flows used in investing activities(6)
Cash Flows from Financing Activities
Net cash used in financing activities— 
Effect of exchange rate changes on cash4 
Net decrease in cash and cash equivalents, including restricted cash(64)
Cash and cash equivalents, including restricted cash, at beginning of the period625 
Cash and cash equivalents, including restricted cash, at the end of period561 
v3.21.2
Current expected credit losses (Tables)
 6 Months Ended
Jun. 30, 2021
Credit Loss [Abstract]  
Movement in the allowance for credit losses and classification of credit loss expense
The following table summarizes the movement in the allowance for credit losses for the six months ended June 30, 2021 and June 30, 2020:
 (In $ millions)
Allowance for credit losses - trade receivablesAllowance for credit losses - other current assetsAllowance for credit losses - related party STAllowance for credit losses related party LTTotal Allowance for credit losses
As at January 1, 2020— — 15 128 143 
Credit loss expense— 5 54 4 63 
As at June 30, 2020— 5 69 132 206 

 (In $ millions)
Allowance for credit losses - trade receivablesAllowance for credit losses - other current assetsAllowance for credit losses - related party STAllowance for credit losses related party LTTotal Allowance for credit losses
As at January 1, 2021— 3 169 137 309 
Credit loss expense— — 48 12 60 
Write-off (1)
— — (74)— (74)
As at June 30, 2021— 3 143149295
(1) In April 2021 we signed a settlement agreement with Aquadrill (formerly Seadrill Partners) which waived all claims on pre-petition positions held, as such $54 million of trading receivables and $20 million of loans has been written-off.

The below table shows the classification of the credit loss expense within the consolidated statement of operations.

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Management contract expenses48 50 
Other financial items12 13 
Total60 63 
v3.21.2
Segment information (Tables)
 6 Months Ended
Jun. 30, 2021
Segment Reporting [Abstract]  
Schedule of segment results
The below section splits out total operating revenue, depreciation, amortization of intangibles, operating net loss, drilling units and capital expenditures by segment:

Total operating revenue
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment232 276 
Floaters154 216 
Jack-up rigs60 98 
Other6 8 
Total452 598 

Depreciation
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment43 52 
Floaters19 105 
Jack-up rigs21 25 
Total83 182 

Loss on impairment of long-lived assets

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment152 160 
Floaters— 1,070 
Jack-ups— — 
Total152 1,230 

Operating loss - Net loss
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment(177)(147)
Floaters(27)(1,184)
Jack-ups(1)10 
Other(47)(51)
Operating loss(252)(1,372)
Unallocated items:
Total financial items and other(342)(374)
Income taxes(11)(2)
Net loss(605)(1,748)
Drilling units - Total assets
(In $ millions)As at June 30, 2021As at December 31,
2020
Harsh environment858 1,032 
Floaters507 528 
Jack-ups562 560 
Total drilling units1,927 2,120 
Unallocated items:
Investments in associated companies248248
Cash and restricted cash644 723 
Other assets838 870 
Total assets3,657 3,961 

Drilling units - Capital expenditures
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Harsh environment17 11 
Floaters12 58 
Jack-ups10 7 
Other1 9 
Total40 85 
Schedule of revenues and fixed assets by geographic area
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 $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Norway234 291 
Brazil54 19 
Angola53 98 
United States46 59 
Saudi Arabia42 62 
Nigeria— 5 
Others (1)
23 64 
Total452 598 
(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.
Fixed assets – drilling units (1)
(In $ millions)As at June 30, 2021As at December 31,
2020
Norway858 1,044 
Saudi Arabia230 234 
Brazil161 79 
Qatar150 151 
Malaysia130 185 
United States87 87 
Other (2)
311 340 
Total1,927 2,120 
(1)     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" represents countries in which we operate that individually had fixed assets representing less than 5% of total fixed assets for any of the periods presented.
Schedule of customer with contract revenues by major customers
We had the following customers with total revenues greater than 10% in any of the periods presented:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
ConocoPhillips19 %13 %
Lundin12 %— %
Equinor13 %19 %
Sonagol10 %9 %
Saudi Aramco9 %10 %
Northern Ocean5 %14 %
v3.21.2
Revenue from Contracts with Customers (Tables)
 6 Months Ended
Jun. 30, 2021
Revenue from Contract with Customer [Abstract]  
Schedule of contract assets and contract liabilities from contracts with customers
The following table provides information about receivables and contract liabilities from our contracts with customers:
(In $ millions)As at June 30, 2021 As at December 31,
2020
Accounts receivable, net122 125 
Current contract liabilities (deferred revenue) (1)
(24)(18)
Non-current contract liabilities (deferred revenue) (2)
(7)(13)

(1)  Current contract liabilities balances are included in “Other current liabilities” in our Consolidated Balance Sheet.
(2) Non-current contract liabilities balances are included in “Other non-current liabilities” in our Consolidated Balance Sheet.

Significant changes in the contract assets and the contract liabilities balances during the six months ended June 30, 2020 are as follows:
(In $ millions)  Contract AssetsContract LiabilitiesNet Contract
Balances
Net contract liability at January 1, 2020  — (29)(29)
Amortization of revenue that was included in the beginning contract liability balance  — 15 15 
Cash received, excluding amounts recognized as revenue  — (19)(19)
Net contract liability at June 30, 2020— (33)(33)
Significant changes in the contract assets and the contract liabilities balances during the six months ended June 30, 2021 are as follows:
(In $ millions)  Contract AssetsContract LiabilitiesNet Contract
Balances
Net contract liability at January 1, 2021  — (31)(31)
Amortization of revenue that was included in the beginning contract liability balance  — 10 10 
Cash received, excluding amounts recognized as revenue— (10)(10)
Net contract liability at June 30, 2021  — (31)(31)
v3.21.2
Other revenues (Tables)
 6 Months Ended
Jun. 30, 2021
Revenue from Contract with Customer [Abstract]  
Other revenues
Other revenues consist of the following:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Leasing revenues12 9 
Total other revenues12 9 
v3.21.2
Other operating items (Tables)
 6 Months Ended
Jun. 30, 2021
Other Income and Expenses [Abstract]  
Other Operating Items
Other operating items consist of the following:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Impairment of long-lived assets (i)
(152)(1,230)
Gain on disposals (ii)
11 — 
Other operating income (iii)
3 8 
Total other operating items(138)(1,222)
v3.21.2
Loss on impairment of equity method investments (Tables)
 6 Months Ended
Jun. 30, 2021
Equity Method Investments and Joint Ventures [Abstract]  
Loss on impairments of equity method investments
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Seadrill Partners - Direct ownership interests—(47)
Total loss on impairment of equity method investments— (47)
v3.21.2
Loss per share (Tables)
 6 Months Ended
Jun. 30, 2021
Earnings Per Share [Abstract]  
Schedule of calculation of basic and diluted EPS
The components of the numerator for the calculation of basic and diluted LPS were as follows:
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Net loss attributable to shareholder(605)(1,745)
Effect of dilution— — 
Diluted net loss available to shareholders(605)(1,745)

The components of the denominator for the calculation of basic and diluted LPS were as follows:
 (In millions)Six months ended June 30, 2021Six months ended June 30, 2020
Basic loss per share:
Weighted average number of common shares outstanding100 100
Diluted loss per share:
Effect of dilution— — 
Weighted average number of common shares outstanding adjusted for the effects of dilution100 100 

The basic and diluted loss per share were as follows:
(In $)Six months ended June 30, 2021Six months ended June 30, 2020
Basic loss per share(6.03)(17.40)
Diluted loss per share(6.03)(17.40)
v3.21.2
Restricted cash (Tables)
 6 Months Ended
Jun. 30, 2021
Restricted Cash and Investments [Abstract]  
Schedule of restricted cash
Restricted cash as at June 30, 2021 and December 31, 2020 was as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Demand deposit pledged as collateral for tax related guarantee (1)
69 65 
Accounts pledged as collateral for Senior Secured Notes46 30 
Accounts pledged as collateral for performance bonds and similar guarantees31 48 
Amounts pledged as collateral for leases (2)
22 22 
Proceeds from rig disposals (3)
12 — 
Other36 32 
Total restricted cash216 197 

(1) We placed a total of 330 million Brazilian Reais of collateral with BTG Pactual under a letter of credit agreement. This relates to long-running tax disputes which are currently being litigated through the Brazilian courts. This is held as non-current within the Consolidated Balance Sheet.
(2) Certain accounts are pledged to the SFL SPVs for lease arrangements for the West Taurus, West Linus and West Hercules. Following an event of default in the fourth quarter of 2020, a restriction was placed on these accounts. As such these accounts were reclassified as restricted.
(3) Sales proceeds on disposal of the West Vigilant of $7 million and deposits received for pending disposal of the West Freedom, West Eminence, West Alpha, West Navigator, West Venture and West Pegasus, totaling $5 million, are classified as restricted as they must be paid (net of any permissible sales costs) to the lenders upon emergence from Chapter 11.

Restricted cash is presented in our Consolidated Balance Sheets as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Current restricted cash147 132 
Non-current restricted cash69 65 
Total restricted cash216 197 
v3.21.2
Marketable securities (Tables)
 6 Months Ended
Jun. 30, 2021
Marketable Securities [Abstract]  
Marketable securities held
The below table shows the carrying value of our investments in marketable securities for periods presented in this report.
(In $ millions)As at June 30, 2021As at December 31, 2020
Archer13 8 
Total marketable securities13 8 
Gains and losses related to marketable securities
The below table shows the gain and losses recognized through net loss for the periods presented in this report.
(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Seadrill Partners - Common units - unrealized loss on marketable securities— (2)
Archer - unrealized gain / (loss) on marketable securities5 (4)
Total unrealized gain / (loss) on marketable securities5 (6)
v3.21.2
Other Assets (Tables)
 6 Months Ended
Jun. 30, 2021
Other Assets [Abstract]  
Schedule of other assets
As at June 30, 2021 and December 31, 2020, other assets included the following:
(In $ millions)As at June 30, 2021As at December 31, 2020
Prepaid Expenses (1)
67 67 
Right of use asset (2)
39 57 
Taxes receivable34 32 
Reimbursable amounts due from customers (3)
18 11 
Deferred contract costs15 14 
Marketable Securities (4)
13 8 
Favorable drilling and management services contracts10 10 
Insurance receivable6 4 
Other assets (5)
30 37 
Total other assets232 240 
(1)Includes retainers paid, but not yet utilized, for legal and advisory fees relating to the Chapter 11 process.
(2)Refer to Note 22 - "Leases" for further information.
(3)Includes related party balances, net of expected credit loss allowance from Northern Ocean. For further information refer to Note 28 – "Related party transactions".
(4)Refer to Note 14 - "Marketable securities" for further information.
(5)Includes $15 million D&O insurance relating to tail back claims in the Chapter 11 process.
Other assets were presented in our Consolidated Balance Sheet as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Other current assets200 194 
Other non-current assets32 46 
Total other assets232 240 
v3.21.2
Investment in associated companies (Tables)
 6 Months Ended
Jun. 30, 2021
Equity Method Investments and Joint Ventures [Abstract]  
Schedule of investment in associated companies
As at June 30, 2021 and December 31, 2020, the carrying values of our investments in associated companies were as follows.

(In $ millions)As at June 30, 2021As at December 31, 2020
Seabras Sapura108 103 
Shareholder loans provided to Seabras Sapura115 121 
Sonadrill23 22 
Gulfdrill2 2 
Total investment in associated companies248 248 
v3.21.2
Drilling units (Tables)
 6 Months Ended
Jun. 30, 2021
Property, Plant and Equipment [Abstract]  
Schedule of drilling units
The following table summarizes the movement for the six months ended June 30, 2020:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 20207,048 (647)6,401 
Additions85 — 85 
Depreciation— (179)(179)
Impairment(1,230)— (1,230)
As at June 30, 20205,903 (826)5,077 
The following table summarizes the movement for the six months ended June 30, 2021:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 20213,108 (988)2,120 
Additions39 — 39 
Depreciation— (80)(80)
Impairment(152)— (152)
As at June 30, 20212,995 (1,068)1,927 
v3.21.2
Equipment (Tables)
 6 Months Ended
Jun. 30, 2021
Property, Plant and Equipment [Abstract]  
Equipment
The following table summarizes the movement for the six months ended June 30, 2020:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 202038 (15)23 
Depreciation— (3)(3)
As at June 30, 202038 (18)20

The following table summarizes the movement for the six months ended June 30, 2021:
 (In $ millions)
CostAccumulated depreciationNet book value
As at January 1, 202139 (20)19 
Depreciation— (3)(3)
As at June 30, 202139 (23)16 
v3.21.2
Debt (Tables)
 6 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Schedule of debt
As at June 30, 2021 and December 31, 2020, we had the following liabilities for third party debt agreements:
(In $ millions)As at June 30, 2021As at December 31, 2020
Secured credit facilities5,662 5,662 
Senior Secured Notes546 515 
Total debt principal6,208 6,177 
Less: Debt balance held as subject to compromise(5,662)— 
Debt balance not subject to compromise546 6,177 
v3.21.2
Other Liabilities (Tables)
 6 Months Ended
Jun. 30, 2021
Payables and Accruals [Abstract]  
Other liabilities
As at June 30, 2021 and December 31, 2020, other liabilities included the following:
(In $ millions)As at June 30, 2021As at December 31, 2020
Uncertain tax provisions84 79 
Lease liabilities71 68 
Accrued expenses69 110 
Employee withheld taxes, social security and vacation payments43 47 
Contract liabilities31 31 
Accrued interest expense30 38 
Taxes payable36 29 
Unfavorable drilling contracts7 7 
Other liabilities9 27 
Total Other Liabilities380 436 

Other liabilities are presented in our Consolidated Balance Sheet as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Other current liabilities275 316 
Other non-current liabilities105 120 
Total Other Liabilities380 436 
v3.21.2
Leases (Tables)
 6 Months Ended
Jun. 30, 2021
Leases [Abstract]  
Schedule of future undiscounted cash flows
For operating leases where we are the lessee, our future undiscounted cash flows as at June 30, 2021 are as follows:
(In $ millions)Future cash flows
July 1 - December 31, 202122 
Year ended December 31, 202251 
Year ended December 31, 20232 
Year ended December 31, 20241 
Year ended December 31, 2025 and thereafter— 
Total76 
Schedule of reconciliation and supplementary information
The following table gives a reconciliation between the undiscounted cash flows and the related operating lease liability recognized in our Consolidated Balance Sheets as at June 30, 2021 and December 31, 2020:
(In $ millions)As at June 30, 2021As at December 31, 2020
Total undiscounted cash flows76 79 
Less: short term leases— — 
Less: discount(5)(11)
Operating lease liability71 68 
Of which:
Current67 51 
Non-current4 17 
The following table gives supplementary information regarding our lease accounting for the six months ended June 30, 2021 and six months ended June 30, 2020:
(In $ million)Six months ended June 30, 2021Six months ended June 30, 2020
Operating Lease Cost:
Operating lease cost5 4 
Short-term lease cost— — 
Total Lease cost5 4 
Other information:
Cash paid for amounts included in the measurement of lease liabilities - Operating Cash flows5 4 
Right-of-use assets obtained in exchange for operating lease liabilities during the period— — 
Weighted-average remaining lease term in months1228
Weighted-average discount rate29 %13 %
Schedule of operating subleases The estimated future undiscounted cash flows on these leases as at June 30, 2021 are as follows:
(In $ millions)Future cash flows
July 1 - December 31, 202114 
Year ended December 31, 202228 
Year ended December 31, 202328 
Year ended December 31, 202421 
2024 and thereafter20 
Total111 
v3.21.2
Common shares (Tables)
 6 Months Ended
Jun. 30, 2021
Equity [Abstract]  
Schedule of share capital
Share capital as at December 31, 2020 and June 30, 2021 was as follows:

Issued and fully paid share capital $0.10 par value each
Shares$ millions
As at December 31, 2020100,384,435 10 
As at June 30, 2021100,384,435 10 
v3.21.2
Non-controlling interest (Tables)
 6 Months Ended
Jun. 30, 2021
Noncontrolling Interest [Abstract]  
Schedule of changes in non-controlling interest
Changes in redeemable non-controlling interest for the periods presented in this report were as follows:
(In $ millions)SFL VIEsSeadrill Nigeria Operations LimitedTotal
As at January 1, 2020140 11 151 
Net loss attributable to non-controlling interest (2)— (2)
Share buyback of Heirs Holding shares in Seadrill Nigeria Operations— (11)(11)
As at June 30, 2020138 — 138 

(In $ millions)SFL VIEsSeadrill Nigeria Operations LimitedTotal
As at January 1, 2021— — — 
As at June 30, 2021— — — 
v3.21.2
Redeemable non-controlling interest (Tables)
 6 Months Ended
Jun. 30, 2021
Temporary Equity Disclosure [Abstract]  
Schedule of changes in redeemable non-controlling interest
Changes in redeemable non-controlling interest for the periods presented in this report were as follows:

(In $ millions) Asia Offshore Drilling Ltd
As at January 1, 202057 
Fair value adjustment(30)
Net loss attributable to redeemable non-controlling interest in the period(1)
As at June 30, 202026 

(In $ millions) Asia Offshore Drilling Ltd
As at January 1, 2021— 
As at June 30, 2021— 
v3.21.2
Accumulated other comprehensive (loss)/income (Tables)
 6 Months Ended
Jun. 30, 2021
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Schedule of accumulated other comprehensive income
Accumulated other comprehensive (loss)/income for the six months ended June 30, 2021 and June 30, 2020 were as follows:


(In $ millions) 
Actuarial loss relating to pensionShare in unrealized loss from associated companiesChange in debt component on Archer bondTotal
As at January 1, 2021 (2)(28)4 (26)
Other comprehensive income— 4 1 5 
As at June 30, 2021(2)(24)5 (21)

(In $ millions) 
Actuarial loss relating to pensionShare in unrealized loss from associated companiesChange in debt component on Archer bondTotal
As at January 1, 2020— (13)— (13)
Other comprehensive (loss)/income(7)(17)2(22)
As at June 30, 2020(7)(30)2 (35)
v3.21.2
Risk management and financial instruments (Tables)
 6 Months Ended
Jun. 30, 2021
Derivative Instruments and Fair Value Disclosures [Abstract]  
Schedule of interest rate risk
We have set out our exposure to interest rate risk at June 30, 2021 in the table below(1):
(In $ millions)As at June 30, 2021Impact of 1% increase in rates
Cash and Restricted Cash644 6 
(1) Debt instruments have been excluded above as:
- We have not paid any interest on the $5,662 million of senior credit facilities since filing for Chapter 11;
- The $546 million of senior secured notes are a fixed rate debt instrument.
Schedule of realized and unrealized gains and losses
Gains and losses on derivatives reported in our Consolidated Statement of Operations included the following:

Gain/(loss) recognized in the Consolidated Statement of Operations relating to derivative financial instrumentsSix months ended June 30, 2021Six months ended June 30, 2020
Interest rate cap agreement—(2)
Embedded conversion option on Archer convertible debt instrument5 3
Gain on derivative financial instruments5 1 
Schedule of derivative financial instruments
Derivative financial instruments included in our Consolidated Balance Sheet, within "Other Assets" included the following:
(In $ millions)Maturity dateApplicable rateOutstanding principal - June 30, 2021As at June 30, 2021As at December 31, 2020
Interest rate capJune 2023
2.87% LIBOR cap
3,500 — — 
Schedule of fair value of financial instruments measured at amortized cost
The carrying value and estimated fair value of our financial instruments that are measured at amortized cost at June 30, 2021 and December 31, 2020 are as follows:
As at June 30, 2021As at December 31, 2020
(In $ millions)Fair
value		Carrying
value		Fair
value		Carrying
value
Assets
Related party loans receivable (1) (Level 2)
391 391 379 379 
Liabilities
Secured credit facilities (Level 3)1,213 5,662 1,193 5,662 
Senior Secured Notes (Level 1)306 546 213 515 
Related party loans payable (Level 3)370 635 424 426 

(1)         Excludes Archer convertible debt receivable, which is measured at fair value on a recurring basis.  Related party loans receivable is $198 million, comprised of principal due of $540 million offset by allowance for expected credit losses recognized of $342 million. For further information on the impact of the expected credit losses to our financial assets please refer to Note 4 - "Current expected credit losses".
Schedule of financial instruments measured at fair value on a recurring basis
The carrying value and estimated fair value of our financial instruments that are measured at fair value on a recurring basis at June 30, 2021 and December 31, 2020 are as follows:
 As at June 30, 2021As at December 31, 2020
(In $ millions)Fair
value		Carrying
value		Fair
value		Carrying
value
Assets
Cash and cash equivalents (Level 1)
428 428 526 526 
Restricted cash (Level 1)
216 216 197 197 
Marketable securities (Level 1)
13 13 8 8 
Related party loans receivable - Archer convertible debt (Level 3)
19 19 13 13 
v3.21.2
Related party transactions (Tables)
 6 Months Ended
Jun. 30, 2021
Related Party Transactions [Abstract]  
Schedule of related party transactions
The below table provides an analysis of related party revenues for periods presented in this report.
 (In $ millions)
Six months ended June 30, 2021Six months ended June 30, 2020
Management fees revenues (a)55 76 
Reimbursable revenues (b)29 100 
Related party inventory sales — 1 
Total related party operating revenues84 177 

(a) We provide management and administrative services to Aquadrill, SeaMex and Sonadrill and operational and technical support services to Aquadrill, SeaMex, Sonadrill and Northern Ocean. We charge our affiliates for support services provided either on a cost-plus mark-up or dayrate basis.

(b) We recognized reimbursable revenues from Northern Ocean for work to perform the first mobilization of the Northern Ocean rigs, West Mira and West Bollsta. As at June 30, 2021, our Consolidated Balance Sheet included $157 million of receivables from Northern Ocean (December 31, 2020: $142 million), before deducting allowances for credit losses. This included $152 million of billed and unbilled trade receivables (December 31, 2020: $137 million), which have been classified within the line item "amount due from related parties", and $5 million of costs incurred not yet billable to Northern Ocean (December 31, 2020: $5 million), which have been classified within "Other Assets".
Related party operating expenses

The below table provides an analysis of related party operating expenses for periods presented in this report.

(In $ millions)Six months ended June 30, 2021Six months ended June 30, 2020
Other related party operating expenses (c)2 — 
West Bollsta lease (d)
21 — 
Total related party operating expenses23 — 

(c) We received services from certain other related parties. These included management and administrative services from Frontline, warehouse rental from Seabras Sapura and other services from Archer and Seatankers.

(d) Seadrill entered a charter agreement to lease the West Bollsta rig from Northern Ocean in 2020. Refer to Note 22 – "Leases" for details.

Related party financial items

The below table provides an analysis of related party financial income for periods presented in this report.

 (In $ millions)
Six months ended June 30, 2021Six months ended June 30, 2020
Interest income (e)10 12 
Total related party financial items10 12 

(e) We earn interest income on our related party loans to SeaMex and Seabras Sapura (see below).

Related party receivable balances

The below table provides an analysis of related party receivable balances for periods presented in this report.
(In $ millions)As at June 30, 2021As at December 31, 2020
Related party loans and interest (f)540 516 
Deferred consideration arrangements (g)— 3 
Convertible bond (h)19 13 
Trading balances (i)193 251 
Allowance for expected credit losses (j)(292)(306)
Total related party receivables460 477 
Of which:
Amounts due from related parties - current50 85 
Amounts due from related parties - non-current410 392 

(f) We have loan receivables outstanding from SeaMex and Seabras Sapura. We have summarized the amounts outstanding in the table below:
(In $ millions)As at June 30, 2021As at December 31, 2020
SeaMex seller's credit and loans receivable485 452 
Seabras loans receivable55 64 
Total related party loans and interest540 516 

SeaMex loans include:
(1) $250 million "sellers credit" provided to SeaMex in March 2015 which matured in December 2019 but is subordinated to SeaMex's external debt facility, which matures in March 2022. As such, we have classified this balance as non-current on our Consolidated Balance Sheets.
(2) $45 million working capital loan advanced to SeaMex in November 2016.
(3) $158 million accrued interest on above loans and other funding. The sellers credit and working capital loan both earn interest at 6.5% and are subordinated to SeaMex's external debt facility.
(4) $23 million loan issued to SeaMex in March 2021 and April 2021. The loan incurs interest at base rate of the Federal Reserve System.
(5) $9 million Sponsor Minimum Liquidity Shortfall. The loan earns interest at 6.5% plus 3-month US LIBOR.
Seabras loans include a series of loan facilities that we extended to Seabras Sapura between May 2014 and December 2016. The $55 million balance shown in the table above includes (i) $41 million of loan principal and (ii) $14 million of accrued interest. The loans are repayable on demand, subject to restrictions on Seabras Sapura's external debt facilities. We earn interest of between 3.4% - LIBOR plus 3.99% on the loans, depending on the facility.

In addition to the Seabras loans above, we have made certain other shareholder loans to Seabras Sapura, which we classify as part of our equity method investment in Seabras Sapura. See Note 17 – "Investment in associated companies" for further details.

Seabras Sapura repaid $16 million of its outstanding loan balances in April 2021, $10 million relating to its loan facility and $6 million relating to its shareholder loans.

(g) Deferred consideration arrangements included receivables due to us from Aquadrill from the sale of the West Vela and the West Polaris to Aquadrill in November 2014 and June 2015, respectively. We have summarized amounts due for each period in the table below:
(In $ millions)As at June 30, 2021As at December 31, 2020
West Vela - Mobilization receivable
— 2 
West Vela - Share of dayrate
— 1 
Total deferred consideration receivable— 3 

On adoption of fresh start accounting, we recorded receivables for West Vela share of dayrate and West Polaris earnout. These amounts were previously accounted for as gain contingencies recognized only when realized. The receivables were recognized at fair value of $29 million and $1 million respectively and the gain was recognized in reorganization items. The West Polaris was settled in 2019.

As part of the settlement agreement with Aquadrill, which waived all claims on pre-petition positions held, the deferred consideration due from Aquadrill was written-off as at June 30, 2021.

(h) On April 26, 2017, we converted $146 million, including accrued interest and fees, in subordinated loans provided to Archer into a $45 million convertible loan. The loan incurred interest at 5.5% and was to mature in December 2021, with a conversion right into equity of Archer Limited in 2021. At inception, the fair value of the convertible bond was $56 million whereas the previous loan had a carrying value of $37 million. We therefore recognized a gain on debt extinguishment of $19 million in 2017.

The loan receivable is a convertible debt instrument comprised of a debt instrument and a conversion option, classed as an embedded derivative. Both elements are measured at fair value at each reporting date.

On March 13, 2020, Archer announced completion of a refinancing, which included agreed renegotiated terms on the convertible loan. The updated terms amended the loan balance to $13 million that bears interest of 5.5%, matures in April 2024 and an equity conversion option. The renegotiated terms resulted in a $29 million impairment being recognized following a reduction in loan balance and an increase to the discount rate. The fair value of the convertible debt instrument as at June 30, 2021 was $19 million of which the split between debt and embedded derivative option was $11 million and $8 million respectively.

(i) Trading balances primarily comprise receivables from SeaMex, Northern Ocean and Sonadrill for related party management fees, crewing fees and payroll recharges. Per our contractual terms these balances are either settled monthly or quarterly in arrears, or in certain cases, in advance. After its emergence from Chapter 11 in May 2021, Aquadrill is no longer considered a related party and any amounts due from them have been reclassified to "Accounts receivable, net" in our Consolidated Balance Sheets. As set out below, we have established credit loss allowances for balances that have not been settled in line with these payment terms and are overdue.

(j) Allowances recognized for expected credit losses on our related party loan and trade receivables following adoption of accounting standard update 2016-13 - Measurement of Credit Losses on Financial Instruments. Refer to Note 4 – "Current expected credit losses" for further information.

Related party payable balances

Related party liabilities are presented in our Consolidated Balance Sheets as follows:
(In $ millions)As at June 30, 2021As at December 31, 2020
Liabilities from Seadrill to SFL SPVs (k)635 426 
Trading balances (l)— 7 
Total related party liabilities635 433 
Of which:
Amounts due to related parties - current— 7 
Long-term debt due to related parties— 426 
Liabilities subject to compromise635— 
On filing for Chapter 11, our pre-petition related party payables are held within "liabilities subject to compromise" in our Consolidated Balance Sheets at June 30, 2021. For further information on our bankruptcy proceedings refer to Note 3 – "Chapter 11 Proceedings" of our Consolidated Financial Statements included herein.

(k) Following the deconsolidation of the SFL SPVs in 2020, we recognized the liability between Seadrill and the SPVs that was previously eliminated on consolidation. The increase in the liability is due to the remeasurement loss recognized for the lease of the West Taurus of $186 million to claim value as the lease was terminated, unwinding of the discount of debt of $54 million offset by payments made of $31 million for the six months ended June 30, 2021.

The following table gives a summary of the sale and leaseback arrangements and repurchase options with SFL, as at June 30, 2021:

(In $ millions)West TaurusWest HerculesWest LinusTotal
Maturity dateDec 2024Dec 2024May 2029
Remaining lease payments— 167373540 
Purchase obligation— 13886224 
Total commitment— 305459764 
Fair value on initial recognition146 136142424 
Book value345 143147635 

The purchase price paid by the SFL SPVs was $850 million (West Taurus - Nov 2008), $850 million (West Hercules - Oct 2008) and $600 million (West Linus - June 2013).

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 average bareboat charter rates per day for the remaining two units is given below for the respective years.

(In $ thousands)20212022202320242025 and thereafter
West Hercules9696183176—
West Linus9992189153122

(l) Trading balances in 2020 primarily included related party payables due to SeaMex and Aquadrill. As part of the settlement agreement with Aquadrill which waived all claims on pre-petition positions held, $8 million due to Aquadrill was written-off as a gain to "Reorganization items" in our Consolidated Statement of Operations for the six months ended June 30, 2021.
v3.21.2
General information - Additional Information (Details)
$ in Thousands
 6 Months Ended
Jun. 30, 2021
USD ($)
rig
drilling_unit
Jul. 24, 2021
USD ($)
Dec. 31, 2020
USD ($)
Jun. 30, 2020
USD ($)
Dec. 31, 2019
USD ($)
Subsequent Event [Line Items]          
Number of offshore drilling units owned and operated | drilling_unit 32        
Number of rigs | rig 1        
Debt due within one year     $ 6,177,000    
Percentage of consenting lenders holding senior secured debt 57.80%        
Cash and cash equivalents $ 644,000   723,000 $ 1,020,000 $ 1,357,000
Unrestricted cash and cash equivalents $ 428,000   $ 526,000    
Subsequent event          
Subsequent Event [Line Items]          
Plan of reorganization, new financing raised   $ 350,000      
Plan of reorganization, reduction of liabilities   4,900,000      
Plan of reorganization, first lien exit facility   $ 300,000      
Plan of reorganization, percentage of new equity securities issued to lenders   16.75%      
Plan of reorganization, amount of senior debt exchanged   $ 5,600,000      
Plan of reorganization, amount of second lien debt issued in exchange transaction   $ 750,000      
Plan of reorganization, percentage of equity securities issued in exchange for extinguishment of debt   83.00%      
Plan of reorganization, general unsecured claims, total available pro rata share amount   $ 250      
Plan of reorganization, percentage of equity securities issued to existing shareholders   0.25%      
Subsequent event | Hemen Holding Ltd. | Investor          
Subsequent Event [Line Items]          
Plan of reorganization, new financing raised   $ 50,000      
Plan of reorganization, convertible financing, percent of equity issuable under specified conditions   5.00%      
v3.21.2
Chapter 11 Proceedings - Narrative (Details)
$ in Thousands
 6 Months Ended
Jun. 14, 2021
USD ($)
claim
Jun. 30, 2021
USD ($)
Jul. 24, 2021
USD ($)
Subsequent Event [Line Items]      
Contractual interest on liabilities subject to compromise not reflected in the Consolidated Statement of Operations   $ 128,000  
Number of bankruptcy claims filed | claim 430    
Amount of filed bankruptcy claims $ 8,800,000    
Remeasurement of terminated lease to allowable claim   $ 186,000  
Subsequent event      
Subsequent Event [Line Items]      
Plan of reorganization, new financing raised     $ 350,000
Plan of reorganization, reduction of liabilities     4,900,000
Plan of reorganization, first lien exit facility     $ 300,000
Plan of reorganization, percentage of new equity securities issued to lenders     16.75%
Plan of reorganization, amount of senior debt exchanged     $ 5,600,000
Plan of reorganization, amount of second lien debt issued in exchange transaction     $ 750,000
Plan of reorganization, percentage of equity securities issued in exchange for extinguishment of debt     83.00%
Plan of reorganization, general unsecured claims, total available pro rata share amount     $ 250
Plan of reorganization, percentage of equity securities issued to existing shareholders     0.25%
Subsequent event | Hemen Holding Ltd. | Investor      
Subsequent Event [Line Items]      
Plan of reorganization, new financing raised     $ 50,000
Plan of reorganization, convertible financing, percent of equity issuable under specified conditions     5.00%
v3.21.2
Chapter 11 Proceedings - Liabilities Subject to Compromise (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Jun. 30, 2020
Reorganizations [Abstract]      
Senior under-secured external debt $ 5,662 $ 0  
Accounts payable and other liabilities 75    
Accrued interest on external debt 34    
Amount due to related party 645    
Liabilities subject to compromise in combined filers 6,416    
Less: Elimination of positions held with non-filers within the Seadrill Consolidated Group (10)    
Liabilities subject to compromise in consolidated group $ 6,406   $ 0
v3.21.2
Chapter 11 Proceedings - Reorganization Items (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Reorganizations [Abstract]    
Advisory and professional fees after filing $ (52)  
Remeasurement of terminated lease to allowable claim (186)  
Gain on write-off of related party balances 8  
Total reorganization items $ (230) $ 0
v3.21.2
Chapter 11 Proceedings - Income Statement (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Reorganization, Chapter 11 [Line Items]    
Contract revenues $ 335 $ 392
Management contract revenues [1] 88 178
Total operating revenues 452 598
Management contract expenses [1] (115) (208)
Depreciation (83) (182)
General and administrative expenses (36) (37)
Total operating expenses (566) (748)
Loss on impairment of long-lived assets (152) (1,230)
Loss on disposals (11) 0
Other operating income [1] 3 8
Total other operating items (138) (1,222)
Operating loss (252) (1,372)
Interest income [1] 12 20
Total Interest expenses (112) (200)
Share in results of joint ventures 2 (66)
Foreign exchange gain/(loss) 9 (24)
Other financial items [1] (33) (21)
Reorganization Items (230) 0
Total financial and other non-operating items, net (342) (374)
Loss before income taxes (594) (1,746)
Income tax expense (11) (2)
Net loss (605) (1,748)
Reorganization, Chapter 11, Debtor-in-Possession    
Reorganization, Chapter 11 [Line Items]    
Contract revenues 335  
Management contract revenues 88  
Total operating revenues 452  
Management contract expenses (118)  
Depreciation (83)  
General and administrative expenses (36)  
Total operating expenses (569)  
Loss on impairment of long-lived assets (152)  
Loss on disposals (11)  
Other operating income 3  
Total other operating items (138)  
Operating loss (255)  
Interest income 1  
Total Interest expenses (79)  
Share in results of joint ventures 1  
Foreign exchange gain/(loss) 9  
Other financial items (13)  
Reorganization Items (230)  
Total financial and other non-operating items, net (311)  
Loss before income taxes (566)  
Income tax expense (9)  
Net loss (575)  
Reimbursable revenues/ expenses    
Reorganization, Chapter 11 [Line Items]    
Revenues 17 19
Expenses (16) (17)
Reimbursable revenues/ expenses | Reorganization, Chapter 11, Debtor-in-Possession    
Reorganization, Chapter 11 [Line Items]    
Revenues 17  
Expenses (16)  
Product and Service, Other [Member]    
Reorganization, Chapter 11 [Line Items]    
Revenues [1] 12 9
Product and Service, Other [Member] | Reorganization, Chapter 11, Debtor-in-Possession    
Reorganization, Chapter 11 [Line Items]    
Revenues 12  
Vessel and rig    
Reorganization, Chapter 11 [Line Items]    
Expenses (316) $ (304)
Vessel and rig | Reorganization, Chapter 11, Debtor-in-Possession    
Reorganization, Chapter 11 [Line Items]    
Expenses $ (316)  
[1] Includes transactions with related parties. Refer to Note 28 – Related party transactions.
v3.21.2
Chapter 11 Proceedings - Balance Sheet (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Jun. 30, 2020
Dec. 31, 2019
Reorganization, Chapter 11 [Line Items]        
Cash and cash equivalents $ 428 $ 526    
Restricted cash 147 132    
Accounts receivable, net 122 125    
Amounts due from related parties, net 50 85    
Other current assets 200 194    
Total current assets 947 1,062    
Investments in associated companies 248 248    
Drilling units 1,927 2,120    
Restricted cash 69 65    
Deferred tax assets 8 9    
Equipment 16 19    
Amounts due from related parties, net 410 392    
Other non-current assets 32 46    
Total non-current assets 2,710 2,899    
Total assets 3,657 3,961    
Trade accounts payable (57) (45)    
Short-term debt due to related party 0 (7)    
Other current liabilities (275) (316)    
Total current liabilities (878) (6,545)    
Liabilities subject to compromise (6,406)   $ 0  
Deferred tax liabilities (8) (10)    
Other non-current liabilities (105) (120)    
Total non-current liabilities (113) (556)    
Total equity 3,740 3,140 $ 98 $ (1,793)
Total liabilities and equity (3,657) $ (3,961)    
Reorganization, Chapter 11, Debtor-in-Possession        
Reorganization, Chapter 11 [Line Items]        
Cash and cash equivalents 414      
Restricted cash 78      
Accounts receivable, net 122      
Amounts due from related parties, net 81      
Other current assets 185      
Total current assets 880      
Investments in associated companies 25      
Drilling units 1,927      
Shares in subsidiaries 409      
Restricted cash 69      
Deferred tax assets 8      
Equipment 16      
Amounts due from related parties, net 3      
Other non-current assets 32      
Total non-current assets 2,489      
Total assets 3,369      
Trade accounts payable (56)      
Short-term debt due to related party (1)      
Other current liabilities (239)      
Total current liabilities (296)      
Liabilities subject to compromise (6,416)      
Deferred tax liabilities (8)      
Other non-current liabilities (105)      
Total non-current liabilities (113)      
Total equity 3,456      
Total liabilities and equity $ (3,369)      
v3.21.2
Chapter 11 Proceedings - Cash Flow (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Reorganization, Chapter 11 [Line Items]    
Net loss $ (605) $ (1,748)
Depreciation 83 182
Loss on disposals (11) 0
Income (Loss) from Equity Method Investments (2) 66
Loss on impairment of investments 0 47
Deferred tax benefit (1) (2)
Non-cash reorganization items 178 0
Unrealized foreign exchange (gain)/loss (4) 22
Change in allowance for credit losses 60 63
Payments for long-term maintenance (26) (71)
Repayments made under lease arrangements (31) 0
Trade accounts receivable 10 16
Trade accounts payable 15 (16)
Related party receivables (17) (88)
Related party payables 1 (9)
Other assets (8) 5
Other liabilities 74 (39)
Net cash used in operating activities (64) (278)
Additions to drilling units and equipment (13) (14)
Proceeds from disposal of drilling unit 7 0
Net cash used in investing activities (19) (13)
Net cash used in financing activities 0 (24)
Effect of exchange rate changes on cash 4 (22)
Net decrease in cash and cash equivalents, including restricted cash (79) (337)
Cash and cash equivalents, including restricted cash, at beginning of the period 723 1,357
Cash and cash equivalents, including restricted cash, at the end of period 644 $ 1,020
Reorganization, Chapter 11, Debtor-in-Possession    
Reorganization, Chapter 11 [Line Items]    
Net loss (575)  
Depreciation 83  
Loss on disposals (11)  
Income (Loss) from Equity Method Investments (1)  
Loss on impairment of investments 152  
Deferred tax benefit (1)  
Non-cash reorganization items 178  
Unrealized foreign exchange (gain)/loss (4)  
Change in allowance for credit losses 54  
Payments for long-term maintenance (26)  
Repayments made under lease arrangements (12)  
Trade accounts receivable 3  
Trade accounts payable 14  
Related party receivables 0  
Related party payables 28  
Other assets 11  
Other liabilities 45  
Net cash used in operating activities (62)  
Additions to drilling units and equipment (13)  
Proceeds from disposal of drilling unit 7  
Net cash used in investing activities (6)  
Net cash used in financing activities 0  
Effect of exchange rate changes on cash 4  
Net decrease in cash and cash equivalents, including restricted cash (64)  
Cash and cash equivalents, including restricted cash, at beginning of the period 625  
Cash and cash equivalents, including restricted cash, at the end of period $ 561  
v3.21.2
Current expected credit losses - Movement in the Allowance for Credit Losses (Details) - USD ($)
$ in Millions
 1 Months Ended 6 Months Ended
Apr. 30, 2021
Jun. 30, 2021
Jun. 30, 2020
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Beginning balance   $ 309 $ 143
Credit loss expense   60 63
Write-off   (74)  
Ending balance   295 206
Trade Receivable      
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Beginning balance   0 0
Credit loss expense   0 0
Write-off   0  
Ending balance   0 0
Allowance for credit losses - other current assets      
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Beginning balance   3 0
Credit loss expense   0 5
Write-off   0  
Ending balance   3 5
Allowance for credit losses - related party ST      
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Beginning balance   169 15
Credit loss expense   48 54
Write-off   (74)  
Ending balance   143 69
Allowance for credit losses - related party ST | Trade Receivable      
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Write-off $ (54)    
Allowance for credit losses - related party ST | Loans Receivable      
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Write-off $ (20)    
Allowance for credit losses related party LT      
Accounts Receivable, Noncurrent, Past Due [Line Items]      
Beginning balance   137 128
Credit loss expense   12 4
Write-off   0  
Ending balance   $ 149 $ 132
v3.21.2
Current expected credit losses - Classification of Credit Loss Expense (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Accounts Receivable, Noncurrent, Past Due [Line Items]    
Credit loss expense $ 60 $ 63
Management contract expenses    
Accounts Receivable, Noncurrent, Past Due [Line Items]    
Credit loss expense 48 50
Other financial items    
Accounts Receivable, Noncurrent, Past Due [Line Items]    
Credit loss expense $ 12 $ 13
v3.21.2
Segment information - Results by Segment (Details)
$ in Millions
 6 Months Ended
Jun. 30, 2021
USD ($)
segment
Jun. 30, 2020
USD ($)
Dec. 31, 2020
USD ($)
Dec. 31, 2019
USD ($)
Segment Reporting [Abstract]        
Number of reportable segments | segment 3      
Number of operating segments | segment 3      
Segment Reporting Information [Line Items]        
Total operating revenue $ 452 $ 598    
Loss on impairment of long-lived assets 152 1,230    
Operating loss - Net loss        
Operating loss (252) (1,372)    
Unallocated items:        
Total financial items and other (342) (374)    
Income taxes (11) (2)    
Net loss (605) (1,748)    
Investments in associated companies 248   $ 248  
Cash and restricted cash 644 1,020 723 $ 1,357
Other assets 232   240  
Total assets 3,657   3,961  
Drilling units - capital expenditures 40 85    
Harsh environment        
Segment Reporting Information [Line Items]        
Loss on impairment of long-lived assets 152 160    
Operating loss - Net loss        
Operating loss (177) (147)    
Unallocated items:        
Drilling units - capital expenditures 17 11    
Floaters        
Segment Reporting Information [Line Items]        
Loss on impairment of long-lived assets 0 1,070    
Operating loss - Net loss        
Operating loss (27) (1,184)    
Unallocated items:        
Drilling units - capital expenditures 12 58    
Jack-up rigs        
Segment Reporting Information [Line Items]        
Loss on impairment of long-lived assets 0 0    
Operating loss - Net loss        
Operating loss (1) 10    
Unallocated items:        
Drilling units - capital expenditures 10 7    
Other        
Operating loss - Net loss        
Operating loss (47) (51)    
Unallocated items:        
Drilling units - capital expenditures 1 9    
Operating Segments        
Segment Reporting Information [Line Items]        
Total operating revenue 452 598    
Depreciation 83 182    
Unallocated items:        
Total drilling units 1,927   2,120  
Operating Segments | Harsh environment        
Segment Reporting Information [Line Items]        
Total operating revenue 232 276    
Depreciation 43 52    
Unallocated items:        
Total drilling units 858   1,032  
Operating Segments | Floaters        
Segment Reporting Information [Line Items]        
Total operating revenue 154 216    
Depreciation 19 105    
Unallocated items:        
Total drilling units 507   528  
Operating Segments | Jack-up rigs        
Segment Reporting Information [Line Items]        
Total operating revenue 60 98    
Depreciation 21 25    
Unallocated items:        
Total drilling units 562   560  
Operating Segments | Other        
Segment Reporting Information [Line Items]        
Total operating revenue 6 $ 8    
Segment Reconciling Items        
Unallocated items:        
Investments in associated companies 248   248  
Cash and restricted cash 644   723  
Other assets $ 838   $ 870  
v3.21.2
Segment Information - Geographic (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2020
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues $ 452 $ 598  
Drilling units 1,927   $ 2,120
Norway      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 234 291  
Drilling units 858   1,044
Brazil      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 54 19  
Drilling units 161   79
Angola      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 53 98  
United States      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 46 59  
Drilling units 87   87
Saudi Arabia      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 42 62  
Drilling units 230   234
Nigeria      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 0 5  
Others      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 23 $ 64  
Drilling units 311   340
Qatar      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Drilling units 150   151
Malaysia      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Drilling units $ 130   $ 185
v3.21.2
Segment information - Major Customers (Details) - Contract Revenues - Customer Concentration Risk
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
ConocoPhillips    
Revenue, Major Customer [Line Items]    
Concentration risk percentage 19.00% 13.00%
Lundin    
Revenue, Major Customer [Line Items]    
Concentration risk percentage 12.00% 0.00%
Equinor    
Revenue, Major Customer [Line Items]    
Concentration risk percentage 13.00% 19.00%
Sonagol    
Revenue, Major Customer [Line Items]    
Concentration risk percentage 10.00% 9.00%
Saudi Aramco    
Revenue, Major Customer [Line Items]    
Concentration risk percentage 9.00% 10.00%
Northern Ocean    
Revenue, Major Customer [Line Items]    
Concentration risk percentage 5.00% 14.00%
v3.21.2
Revenue from Contracts with Customers - Receivables, Contract Assets and Contract Liabilities (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Revenue from Contract with Customer [Abstract]    
Accounts receivable, net $ 122 $ 125
Current contract liabilities (deferred revenues) (24) (18)
Non-current contract liabilities (deferred revenues) $ (7) $ (13)
v3.21.2
Revenue from Contracts with Customers - Significant Changes in Contract Assets and Contract Liabilities (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Revenue from Contract with Customer [Abstract]    
Contract assets, beginning balance $ 0 $ 0
Contract liabilities, beginning balance (31) (29)
Net contract balances, beginning balance (31) (29)
Amortization of revenue that was included in the beginning contract liability balance 10 15
Cash received, excluding amounts recognized as revenue (10) (19)
Contract assets, ending balance 0 0
Contract liabilities, ending balance (31) (33)
Net contract balances, ending balance $ (31) $ (33)
v3.21.2
Revenue from Contracts with Customers - Narrative (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Revenue from Contract with Customer [Abstract]    
Deferred revenue, current $ 24 $ 18
Deferred revenue, noncurrent $ 7 $ 13
v3.21.2
Other revenues (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Revenue from Contract with Customer [Abstract]    
Leasing revenues $ 12 $ 9
Total other revenues $ 12 $ 9
v3.21.2
Other operating items - Schedule of Other Operating Items (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Other Income and Expenses [Abstract]    
Loss on impairment of long-lived assets $ (152) $ (1,230)
Gain on disposals 11 0
Other operating income [1] 3 8
Total other operating items $ (138) $ (1,222)
[1] Includes transactions with related parties. Refer to Note 28 – Related party transactions.
v3.21.2
Other operating items - Additional Information (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Loss on impairment of long-lived assets $ 152 $ 1,230
Gain on disposal relating to the disputed West Mira BOP 11 $ 0
PT Duta Marina    
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Fair value of consideration received 7  
West Mira BOP    
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]    
Gain on disposal relating to the disputed West Mira BOP $ 4  
v3.21.2
Impairment of long-lived assets (Details)
$ in Millions
 6 Months Ended
Jun. 30, 2021
USD ($)
Jun. 30, 2020
USD ($)
Impairment Of Long-Lived Assets [Line Items]    
Loss on impairment of long-lived assets $ 152 $ 1,230
Discount rate | Discounted cash flow    
Impairment Of Long-Lived Assets [Line Items]    
Long-lived assets, measurement input 0.118 0.128
v3.21.2
Loss on impairment of equity method investments (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Equity Method Investments and Joint Ventures [Abstract]    
Total loss on impairment of equity method investments $ 0 $ (47)
v3.21.2
Taxation (Details)
R$ in Millions, $ in Millions
 6 Months Ended
Jun. 30, 2021
USD ($)
Jun. 30, 2020
USD ($)
Jun. 30, 2019
USD ($)
Jun. 30, 2019
BRL (R$)
Related Party Transaction [Line Items]        
Income tax expense $ 11 $ 2    
Secretariat of the Federal Revenue Bureau of Brazil        
Related Party Transaction [Line Items]        
Tax assessment     $ 161  
Appeal, collateral placed | R$       R$ 330
Nigeria        
Related Party Transaction [Line Items]        
Tax assessment     $ 171  
v3.21.2
Loss per share (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Earnings Per Share [Abstract]    
Net loss attributable to shareholder $ (605) $ (1,745)
Effect of dilution 0 0
Diluted net loss available to shareholders $ (605) $ (1,745)
Basic loss per share:    
Weighted average number of common shares outstanding (in shares) 100 100
Diluted loss per share:    
Effect of dilution (in shares) 0 0
Weighted average number of common shares outstanding adjusted for the effects of dilution (in shares) 100 100
Basic loss per share (in dollars per share) $ (6.03) $ (17.40)
Diluted loss per share (in dollars per share) $ (6.03) $ (17.40)
v3.21.2
Restricted cash (Details)
R$ in Millions, $ in Millions
 6 Months Ended
Jun. 30, 2021
USD ($)
Jun. 30, 2021
BRL (R$)
Dec. 31, 2020
USD ($)
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash $ 216   $ 197
Deposits received 5    
Restricted Cash [Abstract]      
Current restricted cash 147   132
Non-current restricted cash 69   65
Total restricted cash 216   197
PT Duta Marina      
Restricted Cash and Cash Equivalents Items [Line Items]      
Fair value of consideration received 7    
BTG Pactual      
Restricted Cash and Cash Equivalents Items [Line Items]      
Appeal, collateral placed | R$   R$ 330  
Demand deposit pledged as collateral for tax related guarantee      
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash 69   65
Accounts pledged as collateral for senior secured notes      
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash 46   30
Accounts pledged as collateral for performance bonds and similar guarantees      
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash 31   48
Amounts pledged as collateral for leases      
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash 22   22
Proceeds from rig disposals      
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash 12   0
Other      
Restricted Cash and Cash Equivalents Items [Line Items]      
Total restricted cash $ 36   $ 32
v3.21.2
Marketable securities - Marketable Securities Held (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Marketable Securities [Abstract]    
Marketable Securities $ 13 $ 8
v3.21.2
Marketable securities - Gross Realized Gains and Losses Related to Marketable Securities (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Gain (Loss) on Securities [Line Items]    
Total unrealized gain / (loss) on marketable securities $ 5 $ (6)
Seadrill Partners - Common units - unrealized loss on marketable securities    
Gain (Loss) on Securities [Line Items]    
Total unrealized gain / (loss) on marketable securities 0 (2)
Archer - unrealized gain / (loss) on marketable securities    
Gain (Loss) on Securities [Line Items]    
Total unrealized gain / (loss) on marketable securities $ 5 $ (4)
v3.21.2
Other Assets - Other Asset Balances (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Other Assets [Abstract]    
Prepaid Expenses $ 67.0 $ 67.0
Right of use asset 39.0 57.0
Taxes receivable 34.0 32.0
Reimbursable amounts due from customers 18.0 11.0
Deferred contract costs 15.0 14.0
Marketable Securities 13.0 8.0
Favorable drilling and management services contracts 10.0 10.0
Insurance receivable 6.4 4.0
Other assets 30.0 37.0
Total other assets 232.0 $ 240.0
D&O insurance $ 15.0  
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] Total other assets Total other assets
v3.21.2
Other Assets - Balance Sheet Presentation (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Other Assets [Abstract]    
Other current assets $ 200 $ 194
Other non-current assets 32 46
Total other assets $ 232 $ 240
v3.21.2
Investment in associated companies (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Schedule of Equity Method Investments [Line Items]    
Investments in associated companies $ 248 $ 248
Seabras Sapura    
Schedule of Equity Method Investments [Line Items]    
Investments in associated companies 108 103
Seabras Sapura - Shareholder loans    
Schedule of Equity Method Investments [Line Items]    
Investments in associated companies 115 121
Sonadrill    
Schedule of Equity Method Investments [Line Items]    
Investments in associated companies 23 22
Gulfdrill    
Schedule of Equity Method Investments [Line Items]    
Investments in associated companies $ 2 $ 2
v3.21.2
Drilling units (Details) - USD ($)
$ in Millions
 3 Months Ended 6 Months Ended
Mar. 31, 2020
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2020
Dec. 31, 2019
Cost          
Impairment of long-lived assets   $ (152) $ (1,230)    
Drilling units          
Cost          
Opening balance $ 7,048 3,108 7,048    
Additions   39 85    
Impairment of long-lived assets (1,230) (152) (1,230)    
Closing balance   2,995 5,903    
Accumulated depreciation          
Opening balance $ (647) (988) (647)    
Depreciation   (80) (179)    
Closing balance   (1,068) (826)    
Net book value   $ 1,927 $ 5,077 $ 2,120 $ 6,401
v3.21.2
Equipment (Details) - Equipment - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2020
Dec. 31, 2019
Cost        
Opening balance $ 39 $ 38    
Closing balance 39 38    
Accumulated depreciation        
Opening balance (20) (15)    
Depreciation (3) (3)    
Closing balance (23) (18)    
Net book value $ 16 $ 20 $ 19 $ 23
v3.21.2
Debt - Schedule of Debt (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Debt Instrument [Line Items]    
Total debt principal $ 6,208 $ 6,177
Debt balance subject to compromise (5,662) 0
Debt balance not subject to compromise 546 6,177
Secured credit facilities | Secured debt    
Debt Instrument [Line Items]    
Total debt principal 5,662 5,662
Senior Secured Notes | Secured debt    
Debt Instrument [Line Items]    
Total debt principal $ 546 $ 515
v3.21.2
Debt - Narrative (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Jan. 15, 2021
Dec. 31, 2020
Debt Disclosure [Abstract]      
Accrued interest compounded and added to principal   $ 21  
Unpaid cash interest compounded to principal   $ 10  
Debt due within one year $ 546   $ 6,177
v3.21.2
Other Liabilities - Liability Balances (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Jun. 30, 2020
Dec. 31, 2019
Other Liabilities [Abstract]        
Uncertain tax provisions $ 84 $ 79    
Lease liabilities 71 68    
Accrued expenses 69 110    
Employee withheld taxes, social security and vacation payments 43 47    
Contract liabilities 31 31 $ 33 $ 29
Accrued interest expense 30 38    
Taxes payable 36 29    
Unfavorable drilling contracts 7 7    
Other liabilities 9 27    
Total Other Liabilities $ 380 $ 436    
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] Total Other Liabilities Total Other Liabilities    
v3.21.2
Other Liabilities - Balance Sheet (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Other Liabilities [Abstract]    
Other current liabilities $ 275 $ 316
Other non-current liabilities 105 120
Total Other Liabilities $ 380 $ 436
v3.21.2
Leases - Additional Information (Details)
Jun. 30, 2021
well
jack-up_rig
Leases [Abstract]  
Number of jack-up rigs leased | jack-up_rig 3
Number of wells under drilling contracts 10
Number of optional wells under drilling contracts 4
v3.21.2
Leases - Operating Leases Future Undiscounted Cash Flows (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Operating leases, future minimum payments due, fiscal year maturity [Abstract]    
July 1 - December 31, 2021 $ 22  
Year ended December 31, 2022 51  
Year ended December 31, 2023 2  
Year ended December 31, 2024 1  
Year ended December 31, 2025 and thereafter 0  
Total undiscounted cash flows $ 76 $ 79
v3.21.2
Leases - Balance Sheet (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Leases [Abstract]    
Total undiscounted cash flows $ 76 $ 79
Less: short term leases 0 0
Less: discount (5) (11)
Operating lease liability 71 68
Current 67 51
Non-current $ 4 $ 17
v3.21.2
Leases - Supplementary Information (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Operating lease cost    
Operating lease cost $ 5 $ 4
Short-term lease cost 0 0
Total Lease cost 5 4
Lease, Other Information [Abstract]    
Cash paid for amounts included in the measurement of lease liabilities - Operating Cash flows 5 4
Right-of-use assets obtained in exchange for operating lease liabilities during the period $ 0 $ 0
Weighted-average remaining lease term in months 12 months 28 months
Weighted-average discount rate 29.00% 13.00%
v3.21.2
Leases - Operating Subleases (Details)
$ in Millions
Jun. 30, 2021
USD ($)
Lessor, Operating Lease, Payments, Fiscal Year Maturity [Abstract]  
July 1 - December 31, 2021 $ 14
Year ended December 31, 2022 28
Year ended December 31, 2023 28
Year ended December 31, 2024 21
2024 and thereafter 20
Total $ 111
v3.21.2
Common shares (Details) - USD ($)
$ / shares in Units, $ in Millions
Jun. 30, 2021
Dec. 31, 2020
Equity [Abstract]    
Common shares, par value (in dollars per share) $ 0.10 $ 0.10
Common stock, shares issued (in shares) 100,384,435 100,384,435
Common stock, value $ 10 $ 10
v3.21.2
Non-controlling interest - Schedule of Changes in Non-Controlling Interest (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Changes in non-controlling interest [Roll Forward]    
Balance, beginning of period $ 0 $ 151
Net loss attributable to non-controlling interest 0 (2)
Share buyback of Heirs Holding shares in Seadrill Nigeria Operations   (11)
Balance, end of period 0 138
SFL VIEs    
Changes in non-controlling interest [Roll Forward]    
Balance, beginning of period 0 140
Net loss attributable to non-controlling interest   (2)
Share buyback of Heirs Holding shares in Seadrill Nigeria Operations   0
Balance, end of period 0 138
Seadrill Nigeria Operations Limited    
Changes in non-controlling interest [Roll Forward]    
Balance, beginning of period 0 11
Net loss attributable to non-controlling interest   0
Share buyback of Heirs Holding shares in Seadrill Nigeria Operations   (11)
Balance, end of period $ 0 $ 0
v3.21.2
Non-controlling interest - Narrative (Details) - USD ($)
 1 Months Ended
Feb. 29, 2020
Jun. 30, 2021
Dec. 31, 2020
Jun. 30, 2020
Dec. 31, 2019
Noncontrolling Interest [Line Items]          
Non-controlling interest   $ 0 $ 0 $ 138,000,000 $ 151,000,000
West Jupiter Drillship Member | Seadrill Nigeria Operations Limited          
Noncontrolling Interest [Line Items]          
Ownership interest (as percent)     10.00%    
Seadrill Nigeria Operations Limited          
Noncontrolling Interest [Line Items]          
Payment to acquire option to buy noncontrolling interest $ 11,000,000        
Option to buy noncontrolling interest $ 1        
Non-controlling interest   $ 0 $ 0 0 $ 11,000,000
Seadrill Nigeria Operations Limited | Redeemable non-controlling interest          
Noncontrolling Interest [Line Items]          
Non-controlling interest       $ 0  
v3.21.2
Redeemable non-controlling interest (Details) - Asia Offshore Drilling - USD ($)
$ in Millions
 6 Months Ended
Sep. 11, 2020
Jun. 30, 2020
Jun. 30, 2021
Dec. 31, 2020
Increase (Decrease) in Temporary Equity [Roll Forward]        
Ownership interest in AOD 100.00%      
Fair value of non-controlling interest $ 31      
Mermaid        
Increase (Decrease) in Temporary Equity [Roll Forward]        
Noncontrolling interest, ownership percentage by noncontrolling owners 33.76%      
Redeemable non-controlling interest        
Increase (Decrease) in Temporary Equity [Roll Forward]        
Beginning balance   $ 57    
Fair value adjustment   (30)    
Reclassifications of Temporary to Permanent Equity   (1)    
Ending balance   26    
Redeemable non-controlling interest   $ 26 $ 0 $ 0
v3.21.2
Accumulated other comprehensive (loss)/income (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Beginning balance $ (3,140) $ 1,793
Other comprehensive (loss)/income 5 (22)
Ending balance (3,740) (98)
Other comprehensive income tax 0 2
AOCI Attributable to Parent    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Beginning balance (26) (13)
Other comprehensive (loss)/income 5 (22)
Ending balance (21) (35)
Actuarial loss relating to pension    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Beginning balance (2) 0
Other comprehensive (loss)/income 0 (7)
Ending balance (2) (7)
Share in unrealized loss from associated companies    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Beginning balance (28) (13)
Other comprehensive (loss)/income 4 (17)
Ending balance (24) (30)
Change in debt component on Archer bond    
AOCI Attributable to Parent, Net of Tax [Roll Forward]    
Beginning balance 4 0
Other comprehensive (loss)/income 1 2
Ending balance $ 5 $ 2
v3.21.2
Risk management and financial instruments - Derivative Narrative (Details)
$ in Millions
 12 Months Ended
May 11, 2018
USD ($)
Dec. 31, 2020
USD ($)
Jun. 30, 2021
USD ($)
Apr. 26, 2017
USD ($)
Derivative [Line Items]        
Total related party liabilities   $ 433 $ 635  
Discounted cash flow | Discount rate        
Derivative [Line Items]        
Senior secured note, yield   37.00%    
Discounted cash flow | Discount rate | Secured credit facilities        
Derivative [Line Items]        
Weighted average cost of capital     0.118  
Interest rate cap        
Derivative [Line Items]        
Purchase of derivative instrument $ 68      
Interest rate cap | LIBOR        
Derivative [Line Items]        
Capped rate 2.87%      
Archer | Convertible bond        
Derivative [Line Items]        
Total related party liabilities       $ 45
v3.21.2
Risk management and financial instruments - Interest Rate Risk (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Jun. 30, 2020
Dec. 31, 2019
Debt Instrument [Line Items]        
Cash and restricted cash $ 644 $ 723 $ 1,020 $ 1,357
Impact of 1% increase in rates 6      
Senior under-secured external debt 5,662 0    
Debt instruments 6,208 6,177    
Segment Reconciling Items        
Debt Instrument [Line Items]        
Cash and restricted cash 644 723    
Secured debt | Senior Secured Notes        
Debt Instrument [Line Items]        
Debt instruments $ 546 $ 515    
v3.21.2
Risk management and financial instruments - Realized and Unrealized Gains and Losses (Details) - (Loss)/gain recognized relating to derivative financial instruments - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Derivative Instruments, Gain (Loss) [Line Items]    
Loss/(gain) on derivative financial instruments $ 5 $ 1
Interest rate cap agreement    
Derivative Instruments, Gain (Loss) [Line Items]    
Loss/(gain) on derivative financial instruments 0 (2)
Archer convertible debt instrument    
Derivative Instruments, Gain (Loss) [Line Items]    
Loss/(gain) on derivative financial instruments $ 5 $ 3
v3.21.2
Risk management and financial instruments - Derivative Financial Instruments (Details) - Interest rate cap - USD ($)
Jun. 30, 2021
Dec. 31, 2020
May 11, 2018
Level 2 | Fair value, recurring basis      
Derivatives, Fair Value [Line Items]      
Derivative asset $ 0 $ 0  
Other Assets      
Derivatives, Fair Value [Line Items]      
Outstanding principal $ 3,500,000,000    
LIBOR cap      
Derivatives, Fair Value [Line Items]      
Applicable rate     2.87%
v3.21.2
Risk management and financial instruments - Carrying Value and Estimated Fair Value of our Financial Instrument (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Liabilities    
Related party loans receivable $ 198  
Related party loans receivable, gross 540  
Related party loans receivable, allowance for credit losses 342  
Fair value | Level 2    
Assets    
Related party loans receivable 391 $ 379
Fair value | Level 3 | Related party loans payable    
Liabilities    
Debt 370 424
Fair value | Level 3 | Secured credit facilities    
Liabilities    
Debt 1,213 1,193
Fair value | Level 1 | Secured debt    
Liabilities    
Debt 306 213
Carrying value | Level 2    
Assets    
Related party loans receivable 391 379
Carrying value | Level 3 | Related party loans payable    
Liabilities    
Debt 635 426
Carrying value | Level 3 | Secured credit facilities    
Liabilities    
Debt 5,662 5,662
Carrying value | Level 1 | Secured debt    
Liabilities    
Debt $ 546 $ 515
v3.21.2
Risk management and financial instruments - Financial Instruments Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Assets    
Restricted cash $ 216 $ 197
Fair value, recurring basis | Level 1 | Carrying value    
Assets    
Cash and cash equivalents 428 526
Restricted cash 216 197
Marketable securities 13 8
Fair value, recurring basis | Level 1 | Fair value    
Assets    
Cash and cash equivalents 428 526
Restricted cash 216 197
Marketable securities 13 8
Fair value, recurring basis | Level 3    
Assets    
Related party loans receivable   85
Fair value, recurring basis | Level 3 | Carrying value    
Assets    
Related party loans receivable 19 13
Fair value, recurring basis | Level 3 | Fair value    
Assets    
Related party loans receivable $ 19 $ 13
v3.21.2
Related party transactions - Related Party Revenue, Operating Expenses, and Financial Items (Details) - USD ($)
$ in Millions
 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2020
Related Party Transaction [Line Items]      
Total related party operating revenues $ 84 $ 177  
Receivables from related parties 460   $ 477
Total related party operating expenses 23 0  
Total related party financial items 10 12  
Northern Ocean      
Related Party Transaction [Line Items]      
Receivables from related parties     142
Receivables from related parties, billed and unbilled 152   137
Receivables from related parties, costs incurred not yet billable 5   $ 5
Northern Ocean | Variable Interest Entity      
Related Party Transaction [Line Items]      
Receivables from related parties 157    
West Bollsta      
Related Party Transaction [Line Items]      
Total related party operating expenses 21 0  
Management fee revenues      
Related Party Transaction [Line Items]      
Total related party operating revenues 55 76  
Reimbursable revenues      
Related Party Transaction [Line Items]      
Total related party operating revenues 29 100  
Related party inventory sales      
Related Party Transaction [Line Items]      
Total related party operating revenues 0 1  
Other, operating expenses      
Related Party Transaction [Line Items]      
Total related party operating expenses $ 2 $ 0  
v3.21.2
Related party transactions - Related Party Receivable Balances (Details) - USD ($)
$ in Millions
 1 Months Ended 6 Months Ended 12 Months Ended
Apr. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Dec. 31, 2018
Apr. 30, 2021
Dec. 31, 2020
Mar. 13, 2020
Dec. 31, 2019
Apr. 26, 2017
Apr. 25, 2017
Nov. 30, 2016
Related Party Transaction [Line Items]                      
Related party receivables, allowance for credit losses   $ (292)       $ (306)          
Total related party receivables   460       477          
Amounts due from related parties - current   50       85          
Amounts due from related parties - non-current   410       392          
Working capital loan                     $ 45
Impairment Of Related Party Note [1]   0 $ 29                
Related party convertible note receivable             $ 13        
Archer                      
Related Party Transaction [Line Items]                      
Related party receivable before conversion                 $ 146    
Related party receivable after conversion                 $ 45    
Convertible note receivable, interest rate             5.50%   5.50%    
Convertible note receivable, fair value                 $ 56 $ 37  
Gain on debt extinguishment       $ 19              
Impairment Of Related Party Note   29                  
Subordinated loans including accrued interest and fees | Archer Convertible Debt                      
Related Party Transaction [Line Items]                      
Related party receivable             $ 11        
Embedded derivative option | Archer Convertible Debt                      
Related Party Transaction [Line Items]                      
Related party receivable             $ 8        
Related party loans and interest                      
Related Party Transaction [Line Items]                      
Related party receivables, gross   540       516          
Total related party receivables   540       516          
Related party loans and interest | SeaMex seller's credit and loans receivable                      
Related Party Transaction [Line Items]                      
Total related party receivables   485     $ 23 452          
Sellers credit   250                  
Interest receivable   $ 158                  
Sellers credit and working capital loans, interest rate   6.50%                  
Sponsor Minimum Liquidity Shortfall loan facility   $ 9                  
Related party loans and interest | SeaMex seller's credit and loans receivable | LIBOR                      
Related Party Transaction [Line Items]                      
Sponsor Minimum Liquidity Shortfall loan facility, interest rate   6.50%                  
Related party loans and interest | Seabras loans receivable                      
Related Party Transaction [Line Items]                      
Related party receivables, gross   $ 41                  
Total related party receivables   55       64          
Interest receivable   $ 14                  
Repayment of loans $ 16                    
Related party loans and interest | Seabras loans receivable | Minimum                      
Related Party Transaction [Line Items]                      
Interest rate on related party receivable   3.40%                  
Related party loans and interest | Seabras loans receivable | LIBOR | Maximum                      
Related Party Transaction [Line Items]                      
Interest rate on related party receivable   3.99%                  
Deferred consideration arrangements                      
Related Party Transaction [Line Items]                      
Related party receivables, gross   $ 0       3          
Deferred consideration arrangements | Seadrill Partners | Disposed of by sale                      
Related Party Transaction [Line Items]                      
Total related party receivables   0       3          
Convertible bond                      
Related Party Transaction [Line Items]                      
Related party receivables, gross   19       13          
Trading balances                      
Related Party Transaction [Line Items]                      
Related party receivables, gross   193       251          
Loan facility | Seabras loans receivable                      
Related Party Transaction [Line Items]                      
Repayment of loans 10                    
Shareholder loans | Seabras loans receivable                      
Related Party Transaction [Line Items]                      
Repayment of loans $ 6                    
Due From Related Party, Deferred Compensation Arrangements, Mobilization Receivable | Seadrill Partners | Disposed of by sale | West Vela                      
Related Party Transaction [Line Items]                      
Total related party receivables   0       2          
Due From Related Party, Deferred Compensation Arrangements, Share Of Dayrate | Seadrill Partners | Disposed of by sale | West Vela                      
Related Party Transaction [Line Items]                      
Total related party receivables   $ 0       $ 1          
Adjustments, increase (decrease), Amount due from related parties               $ 29      
Seadrill Partners | Disposed of by sale | West Polaris | Fair value                      
Related Party Transaction [Line Items]                      
Total related party receivables               $ 1      
[1] Includes transactions with related parties. Refer to Note 28 – Related party transactions.
v3.21.2
Related party transactions - Related Party Payable Balances (Details) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Jun. 30, 2020
Related Party Transaction [Line Items]      
Total related party liabilities $ 635 $ 433  
Amounts due to related parties - current 0 7  
Long-term debt due to related parties 0 426  
Liabilities subject to compromise 6,406   $ 0
Related party loans payable      
Related Party Transaction [Line Items]      
Total related party liabilities 635 426  
Long-term debt due to related parties 0 426  
Liabilities subject to compromise 635 0  
Trading balances      
Related Party Transaction [Line Items]      
Amounts due to related parties - current $ 0 $ 7  
v3.21.2
Related party transactions - Chapter 11 Proceedings (Details) - USD ($)
$ in Millions
 6 Months Ended
Jul. 06, 2015
Dec. 01, 2008
Oct. 31, 2008
Jun. 30, 2021
West Taurus        
Related Party Transaction [Line Items]        
Remeasurement loss       $ 186
Unwinding of discount debt       54
Payments       $ 31
Purchase price   $ 850    
West Hercules        
Related Party Transaction [Line Items]        
Purchase price     $ 850  
West Linus        
Related Party Transaction [Line Items]        
Purchase price $ 600      
v3.21.2
Related party transactions - Sale Leaseback Transaction (Details) - Ship Finance - Affiliated entity
$ in Millions
 6 Months Ended
Jun. 30, 2021
USD ($)
Related Party Transaction [Line Items]  
Sale leaseback transaction, remaining lease payments $ 540
Sale lease transaction, purchase obligation 224
Sale leaseback transaction, total commitment 764
Sale leaseback transaction, fair value 424
Sale leaseback transaction, net book value 635
West Taurus  
Related Party Transaction [Line Items]  
Sale leaseback transaction, remaining lease payments 0
Sale lease transaction, purchase obligation 0
Sale leaseback transaction, total commitment 0
Sale leaseback transaction, fair value 146
Sale leaseback transaction, net book value 345
West Hercules  
Related Party Transaction [Line Items]  
Sale leaseback transaction, remaining lease payments 167
Sale lease transaction, purchase obligation 138
Sale leaseback transaction, total commitment 305
Sale leaseback transaction, fair value 136
Sale leaseback transaction, net book value 143
West Linus  
Related Party Transaction [Line Items]  
Sale leaseback transaction, remaining lease payments 373
Sale lease transaction, purchase obligation 86
Sale leaseback transaction, total commitment 459
Sale leaseback transaction, fair value 142
Sale leaseback transaction, net book value $ 147
v3.21.2
Related party transactions - Average Bareboat Charter Rates (Details)
$ in Thousands
 6 Months Ended
Jun. 30, 2021
USD ($)
Aquadrill  
Related Party Transaction [Line Items]  
Write off $ 8,000
West Hercules  
Related Party Transaction [Line Items]  
2021 96
2022 96
2023 183
2024 176
2025 and thereafter 0
West Linus  
Related Party Transaction [Line Items]  
2021 99
2022 92
2023 189
2024 153
2025 and thereafter $ 122
v3.21.2
Related party transactions - Other Related Party Transactions (Details) - USD ($)
Jun. 30, 2021
Dec. 31, 2020
Dec. 31, 2013
Nov. 30, 2012
Seabras Sapura | Secured debt | Sapura Esmeralda        
Related Party Transaction [Line Items]        
Maximum borrowing capacity     $ 36,000,000 $ 179,000,000
Seabras Sapura | TL Offshore Sdn. Bhd | Sponsor guarantee        
Related Party Transaction [Line Items]        
Total amount guaranteed $ 130,000,000 $ 132,000,000    
v3.21.2
Commitments and contingencies (Details)
$ in Millions
 1 Months Ended 6 Months Ended 12 Months Ended 30 Months Ended
Jun. 28, 2019
Mar. 31, 2019
rig
Jun. 30, 2021
USD ($)
contract
Dec. 31, 2020
USD ($)
Jun. 30, 2021
USD ($)
contract
Guarantor Obligations [Line Items]          
Number of newbuilding contracts cancelled | contract     8   8
Number of rigs included in legal proceedings | rig   8      
Costs to repair equipment     $ 23.0    
Insurance deductible     1.3    
Recovered from insurance         $ 15.3
Insurance receivable     $ 6.4 $ 4.0 $ 6.4
Insurance Recoveries, Loss Of Hire       $ 19.0  
Nigeria | Seadrill Mobile Units (Nigeria) Ltd          
Guarantor Obligations [Line Items]          
Contract revenue, surcharge 2.00%        
v3.21.2
Subsequent Events (Details) - USD ($)
$ in Millions
 6 Months Ended
Jul. 09, 2021
Jul. 02, 2021
Jun. 30, 2021
Jun. 30, 2020
Jul. 24, 2021
Jan. 15, 2021
Subsequent Event [Line Items]            
Gain on disposals     $ 11 $ 0    
Secured debt | Senior Secured Notes            
Subsequent Event [Line Items]            
Interest rate           12.00%
Subsequent event            
Subsequent Event [Line Items]            
Plan of reorganization, new financing raised         $ 350  
Plan of reorganization, reduction of liabilities         $ 4,900  
Principal noteholders approving amendments 80.00%          
Subsequent event | West Freedom            
Subsequent Event [Line Items]            
Gain on disposals   $ 5        
v3.21.2
Label Element Value
Accounting Standards Update [Extensible Enumeration] us-gaap_AccountingStandardsUpdateExtensibleList Accounting Standards Update 2016-13 [Member]