XML 134 R34.htm IDEA: XBRL DOCUMENT
v3.22.1

Financial Instruments | 12 Months Ended
--- | ---
Dec. 31, 2021
Fair Value Disclosures [Abstract] |
Financial Instruments | Note 26 - Financial Instruments Concentration of credit risk There is a concentration of credit risk with respect to cash and cash equivalents and restricted cash to the extent that substantially all of the amounts are carried with DNB Bank ASA and Citibank, however we believe this risk is remote, as they are established and reputable establishments with no prior history of default. Interest rate risk The Company is exposed to interest rate risk related to the LIBOR floating-rate portion of debts under our existing financing arrangements. There is a risk that LIBOR rate fluctuations will have a negative effect on the value of our cash flows. The Company is exposed to changes in long-term market interest rates if and when maturing debt is refinanced with new debt. In certain situations, the Company may enter into financial instruments to reduce the risk associated with fluctuations in interest rates. The Company is not engaged in derivative transactions for speculative or trading purposes and has not entered into derivative agreements to mitigate the risk of these fluctuations. Foreign exchange risk management The majority of the Company's gross earnings are receivable in U.S dollars. The majority of our transactions, assets and liabilities are denominated in U.S. dollars, our functional currency, however, we incur certain expenditures in other currencies. There is a risk that currency fluctuations, primarily relative to the U.S. dollar will have a negative effect on the value of our cash flows. The Company has not entered into derivative agreements to mitigate the risk of these fluctuations. Supplier risk A supplier risk exists in relation to our rigs undergoing construction with Keppel and PPL, however, we believe this risk is remote as Keppel and PPL are global leaders in the rig and shipbuilding sectors. Failure to complete the construction of any newbuilding on time may result in the delay, renegotiation or cancellation of employment contracts secured for the newbuildings. Further, significant delays in the delivery of the newbuildings could have a negative impact on the Company’s reputation and customer relationships. The Company could also be exposed to contractual penalties for failure to commence operations in a timely manner or experience a loss due to non-payment under refund guarantees issued by Keppel’s and PPL’s respective parent, all of which would adversely affect the Company’s business, financial condition and results of operations. Concentration of financing risk There is a concentration of financing risk with respect to our long-term debt to the extent that a substantial amount of our long-term debt is carried or will be carried by Keppel and PPL in the form of shipyard financing. We believe the counterparties to be sound financial institutions, therefore, we believe this risk is remote. Fair values of financial instruments The carrying value and estimated fair value of the Company’s cash and financial instruments were as follows:
| As of December 31, 2021 | As of December 31, 2020
(In $ millions) | Hierarchy | Fair Value | Carrying Value | Fair Value | Carrying Value
Assets |  |  |  |  |
Cash and cash equivalents(1) | 1 | 34.9 |  | 34.9 | 19.2 |  | 19.2
Restricted cash(1) | 1 | 3.3 |  | 3.3 | — |  | — |
Trade receivables(1) | 1 | 28.5 |  | 28.5 | 22.9 |  | 22.9
Tax retentions receivable(1) | 1 | 1.9 |  | 1.9 |  | 10.5 |  | 10.5
Other current assets (excluding deferred costs)(1) | 1 | 14.1 |  | 14.1 |  | 14.9 |  | 14.9 |
Due from related parties(1) | 1 | 48.6 |  | 48.6 | 34.9 |  | 34.9
Non-current restricted cash(1) | 1 | 7.8 |  | 7.8 |  | — |  | — |
Liabilities |  |  |  |  |
Trade payables(1) | 1 | 34.7 |  | 34.7 | 20.4 |  | 20.4
Accruals expenses and other current liabilities(1) | 1 | 83.2 |  | 83.2 | 75.6 |  | 75.6
Long-term debt(2) | 2 | 1,728.6 |  | 1,915.9 | 1,609.8 |  | 1,906.2
Guarantees issued to equity method investments(3) | 3 | — |  | — |  | 5.9 |  | 5.9 |
(1) The carrying values approximate the fair values due to their near term expected receipt of cash. (2) Long-term debt includes our 3.875% convertible bond due in 2023 which is fair valued using observable market-based inputs. (3) The Guarantee issued to our equity method investment, Opex, as at December 31, 2020 was valued utilizing the inferred debt market method and subsequently mapped to an alpha category credit score, adjusting for country risk and probability of default. Effective August 4, 2021, upon sale of the Company's 49% interest in Opex, the guarantee was terminated and the associated liability was derecognized (see Note 7 - Equity Method Investments). Assets measured at fair value on a non-recurring basis As at December 31, 2020, the jack-up rig "Balder" was classified as held for sale and subsequently sold in February 2021 (see Note 6 - Gain on Disposals). The company measured the rig at a fair value of $4.5 million, which was determined using level 3 inputs based on a combination of an income approach, using projected discounted cash flows and estimated sale or scrap value which required significant judgements. There were no such items as at December 31, 2021.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=123874694&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration