Sevan Drilling entered into hedging arrangements in March 2011 for the Credit Facility of USD 480 million related to Sevan Driller and for the Credit Facility USD 525 million related to Sevan Brasil.
75 % of the total interest rate exposure under the Credit Facilities is hedged for the whole loan tenor.
In process with annual accounts, we have identified a non-cash cost item relating to accounting for the valuation of the hedging arrangements on the Sevan Brasil facility. A non-cash loss of USD 14 million was capitalized instead of being taken into the income statement. It was assumed that because the Sevan Brasil was not yet in service all costs would be capitalized. However, according to IFRS rules these costs should have been taken across the income statement as has been done with the Sevan Driller facility. We have therefore decided to restate our Q3 Financial report to include the non-cash cost item of USD 14 million related to the hedging arrangements, and minor re-classifications in equity and cash flow that also should have been reflected in Q3.
Please see the attached report for more details.
For further information, please contact:
Scott Kerr, CEO, Sevan Drilling ASA
+47 99283890 mobile
Jon H. Wilmann, CFO, Sevan Drilling ASA
+47 90560406 mobile
About Sevan Drilling:
Sevan Drilling ASA is an international offshore drilling contractor specializing in the ultra deepwater segment. Sevan Drilling ASA is listed on Oslo Axess.
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.