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Weatherford closes sale of land drilling rigs for USD32m in total.

M2 EQUITYBITES-March 26, 2019-Weatherford closes sale of land drilling rigs for USD32m in total


Weatherford International plc (NYSE:WFT) disclosed on Monday that it closed the sale of two land drilling rigs that were relocated in Algeria and has delivered two idle land drilling rigs from Iraq. It received USD10m in cash for each of the Algeria land drilling rigs and another USD12m in cash for the delivery of two idle land drilling rigs outside of Iraq, for total proceeds of USD32m.

Also, the company's subsidiary signed definitive agreements with ADES International Holding plc in July 2018, for the sale of Weatherford's land drilling rig operations in Algeria, Kuwait and Saudi Arabia as well as two idle land rigs in Iraq, for a total cash purchase price of USD287.5m (the transaction). The transaction includes 31 land drilling rigs and related drilling contracts, together with about 2,300 employees and contract personnel.

ADES extends oil and gas drilling and production services through its subsidiaries and is a service provider in the Middle East and North Africa, offering onshore and offshore contract drilling as well as work over and production services. Currently, it has a fleet of 34 onshore drilling rigs, 13 jack-up offshore drilling rigs, a jack-up barge and a mobile offshore production unit that includes a floating storage and offloading unit.

Further, these transactions are the last in a series that were subject to regulatory approvals, consents and other customary closing conditions. In December 2018, it closed its Precision Drilling Services Saudi Arabia land drilling operations for USD92.5m in cash. In November 2018, it declared the closing of its Kuwait land drilling rigs sale for USD123m in cash and an additional USD12m to be received in equal USD6 increments upon the delivery of two idle land drilling rigs from Iraq. In February 2019, it completed the sale of four contracted drilling rigs in Algeria for USD40m in cash and therefore, totally received proceeds of USD287.5m that it has already used or intends to use to reduce its debt.

A multinational oilfield service company, Weatherford provides solutions, technology and services to the oil and gas industry. The Company operates in over 80 countries and has a network of approximately 700 locations, including manufacturing, service, research and development, and training facilities and employs approximately 26,500 people.

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Publication:M2 EquityBites (EQB)
Geographic Code:6ALGE
Date:Mar 26, 2019
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