Seadrill Limited — Capital/Financing Update 2011

Jan 3, 2011

SDRL - Seadrill acquires two semi-submersible ultra-deepwater rigs under construction

Hamilton, Bermuda, January 3, 2011 - Seadrill has entered into an agreement to

acquire the two ultra-deepwater semi-submersible drilling rigs, Seadragon I and

Seadragon II. The total project price for the two rigs, which are currently

under construction at the Jurong Shipyard in Singapore, is estimated to be

approximately US$1.2 billion (including project management for the remaining

construction period, drilling and handling tools, spares, operations

preparations and capitalized interest). Deliveries of the two rigs are expected

in the first quarter and fourth quarter 2011, respectively.

Seadrill has secured new bank debt to finance the investment. The principal

terms and conditions have been agreed and the debt will have a seven-year tenor

and a 13-year repayment profile. The two rigs will serve as security for the new

debt.

Furthermore, the first rig to be completed, Seadragon I, has a five year

contract in place. However, due to postponed delivery the contract is subject to

further discussions among the involved parties. The second unit, Seadragon II,

has currently no employment in place.

Alf C Thorkildsen, Chief Executive Officer of Seadrill Management AS says, "We

expect the demand for ultra-deepwater units to strengthen over the next years.

This investment increases our exposure to this growing market segment at an

acceptable price and a manageable risk. Furthermore, we are well familiar with

the design of and equipment on the rigs and are pleased to be able to continue

our long and strong relationship with the reputable Jurong Shipyard."

John Fredriksen, Chairman of Seadrill Limited says, "The cash break-even cost

per day for each rig including operating cost, tax, interest expenses and

scheduled debt installments is expected to be around US$385,000. The Board

anticipates that the purchase of the two rigs including the agreed financing

will strengthen Seadrill's dividend capacity going forward."

The rigs are based on the Moss Maritime CS50 Mk II design and belong to a high

specification, new generation drilling units, focusing on a broader specter of

operational capabilities, a larger operating area, a high load carrying

capacity, efficiency and improved safety and working environment as well as a

special environmental focus. The dynamically positioned (DP 3 class

certification) rigs are equipped with NOV drilling equipment and have water

depth capability up to 10,000 ft and total vertical drilling depth capacity up

to 35,000 feet. The rigs each have a single derrick with dual pipe handling and

offline stand building capabilities providing for increased efficiency. The

subsea well control system includes a six ram 15k psi BOP stack with two 10k psi

annulars. Each rig's variable deck-load specification is 6,200 mtons and has the

accommodation capacity for 192 people.

Analyst contact:

Jim Dåtland

Vice President Investor Relations

Seadrill Management AS

+47 51 30 99 19

Media contact:

Alf C Thorkildsen

Chief Executive Officer

Seadrill Management AS

+47 51 30 99 19

This information is subject of the disclosure requirements acc. to §5-12 vphl

(Norwegian Securities Trading Act)

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