Seadrill Limited - Capital/Financing Update 2016

SDRL - Seadrill Agrees to Debt-for-Equity Exchange

Hamilton, Bermuda, May 18, 2016 - Seadrill Limited ("Seadrill" or the "Company")

announces today that it has entered into a privately negotiated exchange

agreement with certain holders of its outstanding 5-5/8% Senior Notes due 2017

(the "2017 Notes"), pursuant to which the Company has agreed to issue a total of

8,184,340 new shares of its common stock, par value $2.00 per share, in exchange

for $55.0 million principal amount of the 2017 Notes in accordance with Section

3(a)(9) of the U.S. Securities Act of 1933, as amended (the "Exchange").

Settlement is expected to occur on May 20, 2016, upon which the Company will

have a total of 500,944,280 shares of its common stock issued and outstanding.

FORWARD LOOKING STATEMENTS

This news release includes forward-looking statements. Such statements are

generally not historical in nature, and specifically include statements about

the Company's plans, strategies, business prospects, changes and trends in its

business and the markets in which it operates. These statements are made based

upon management's current plans, expectations, assumptions and beliefs

concerning future events impacting the Company and therefore involve a number of

risks, uncertainties and assumptions that could cause actual results to differ

materially from those expressed or implied in the forward-looking statements,

which speak only as of the date of this news release. Consequently, no forward-

looking statement can be guaranteed. When considering these forward-looking

statements, you should keep in mind the risks described from time to time in the

Company's filings with the Securities and Exchange Commission, including its

Annual Report on Form 20-F (File No. 001-34667). The Company undertakes no

obligation to update any forward looking statements to reflect events or

circumstances after the date on which such statement is made or to reflect the

occurrence of unanticipated events. New factors emerge from time to time, and

it is not possible for the Company to predict all of these factors. Further,

the Company cannot assess the impact of each such factor on its business or the

extent to which any factor, or combination of factors, may cause actual results

to be materially different from those contained in any forward looking

statement.

This information is subject of the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

[HUG#2013463]

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