Shelf Drilling North Sea Reports Third Quarter 2023 Results

PRESS RELEASE 

SHELF DRILLING NORTH SEA REPORTS THIRD QUARTER 2023 RESULTS

Dubai, UAE, November 9, 2023 - Shelf Drilling (North Sea), Ltd. ("Shelf Drilling
North Sea" and, together with its subsidiaries, the "Company", Euronext Growth
Oslo Exchange: SDNS) announces results for the third quarter of 2023 ending
September 30. The results highlights will be presented by audio conference call
on November 9, 2023 at 6:00 pm Dubai time / 3:00 pm Oslo time. Dial-in details
for the call are included in the press release posted on November 1, 2023 and on
page 3 of this release.

David Mullen, Chief Executive Officer, commented: "During the third quarter of
2023, we continued to deliver strong operational performance, including the
successful new contract start-up with the Shelf Drilling Fortress in late
August. Our financial results were adversely impacted by a provision for credit
losses associated with one customer in the UK, and as a result, our quarterly
EBITDA declined to $1 million. The Shelf Drilling Barsk is expected to complete
its existing contract in Norway later this month following a successful campaign
on the Gina Krog platform, prior to commencing the new contract with Equinor in
May 2024. The Shelf Drilling Perseverance is being marketed in multiple
geographies, and we see attractive opportunities for the rig with commencement
dates in mid-2024. Once these two rigs return to service, we expect Shelf
Drilling North Sea to deliver significant improvement in earnings and cash flow
in the second half of 2024."

Third Quarter Highlights

o Q3 2023 adjusted revenues of $32.1 million.
o Q3 2023 adjusted EBITDA of $1.4 million, representing an adjusted EBITDA
margin of 4%.
o Q3 2023 net loss of $6.1 million.
o Q3 2023 capital expenditures and deferred costs totaled $3.2 million.
o The Company's cash and cash equivalents balance at September 30, 2023 was
$46.6 million.
o Contract backlog was $218.5 million at September 30, 2023 across four
contracted rigs.
o In July 2023, the Shelf Drilling Perseverance completed its contract with IOG
in the UK; rig remains available and is being marketed for contract
opportunities in multiple geographies with commencement dates around the middle
of 2024.
o In September 2023, the Shelf Drilling Fortress secured a two-well contract
extension in direct continuation of its current contract with CNOOC Petroleum
Europe Limited in the UK; rig is now under contract until June 2024 with
additional options thereafter.

Third Quarter Results

Adjusted revenues were $32.1 million in Q3 2023 compared to $30.3 million in Q2
2023. The $1.8 million (6%) sequential increase in revenues was primarily due to
higher average earned dayrates and an increase in other revenues, offset by
lower effective utilization. Average earned dayrate increased to $91.6 thousand
in Q3 2023 from $78.6 thousand in Q2 2023, mainly due to one rig in the United
Kingdom that commenced a new contract in Q3 2023. Effective utilization
decreased to 62% in Q3 2023 from 74% in Q2 2023 as one rig in the UK completed
its contract in July 2023 and is currently being marketed for multiple
opportunities. Other revenues increased to $10.8 million in Q3 2023 compared to
$9.0 million in Q2 2023, primarily due to additional lease revenues on the Shelf
Drilling Barsk.

Total operating and maintenance expenses increased to $23.8 million in Q3 2023
compared to $21.0 million in Q2 2023. The increase of $2.8 million was primarily
due to higher operating costs for one rig that was idle in Q2 2023 and started a
new contract in August 2023 and higher maintenance costs for one rig in Denmark.

General and administrative expenses increased to $7.3 million in Q3 2023
compared to $4.1 million in Q2 2023. The increase of $3.2 million was due to an
increase in provision for credit losses. 

Adjusted EBITDA for Q3 2023 decreased to $1.4 million compared to $5.0 million
for Q2 2023 primarily due to a provision for credit losses in Q3 2023. The
adjusted EBITDA margin of 4% in Q3 2023 decreased from 17% in Q2 2023.

Capital expenditures and deferred costs of $3.2 million in Q3 2023 increased
from $2.2 million in Q2 2023 primarily related to investment in fleet spares.

Q3 2023 ending cash and cash equivalents balance of $46.6 million decreased by
$6.3 million from $52.9 million at the end of Q2 2023 primarily due to the build
up of working capital during the quarter.

For further queries, please contact: 
Greg O'Brien, Executive Vice President and Chief Financial Officer 
Shelf Drilling (North Sea), Ltd. 
Tel.: [phone] 
Email : [e-mail]


Dial in Details for the Audio Conference call

Participants will	receive	conference access information only when they register
for the conference via the link below: 

Online Registration:
https://register.vevent.com/register/BIf49dcd5566c04b57a569db65c19b5aec

Participants must register for the call using online registration. Upon
registering, each participant will be provided with call details.

About Shelf Drilling North Sea
Shelf Drilling North Sea is a shallow water offshore drilling contractor
primarily operating in the North Sea. The company's fit-for-purpose strategy and
fleet of modern high-specification harsh environment jack-up rigs enable it to
offer a broad range of services in the shallow water drilling markets. The
company is incorporated under the laws of Bermuda. Since October 12, 2022,
Company shares are listed on the Euronext Growth Oslo Exchange under the ticker
symbol SDNS. 

Special Note Regarding Forward-Looking Statements
Matters discussed in this announcement may constitute forward-looking
statements. Forward-looking statements are statements that are not historical
facts and may be identified by words such as "believe", "expect", "anticipate",
"strategy", "intends", "estimate", "will", "may", "continue", "should" and
similar expressions. The forward-looking statements in this release are based
upon various assumptions, many of which are based, in turn, upon further
assumptions. Although the Company believes that these assumptions were
reasonable when made, these assumptions are inherently subject to significant
known and unknown risks, uncertainties, contingencies and other important
factors which are difficult or impossible to predict and may be beyond its
control. Such risks, uncertainties, contingencies and other important factors
could cause actual events to differ materially from the expectations expressed
or implied in this release by such forward-looking statements. Given these
factors, users of this information should not place undue reliance on the
forward-looking statements.

Additional information about Shelf Drilling (North Sea), Ltd. can be found at
https://www.shelfdrillingnorthsea.com.

This information is subject to the disclosure requirements pursuant to Euronext
Growth Rule Book part II.

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