Bermudian-based SFL Corporation Ltd, one of the world’s largest ship-owning companies, has agreed to make changes to the chartering and management structure of the harsh environment jack-up drilling rig West Linus.

The company said the rig was delivered in 2014, and is currently operated by a subsidiary of island-based offshore drilling company Seadrill Ltd and employed on a long-term drilling contract with ConocoPhillips Skandinavia AS in the North Sea until the fourth quarter of 2028.

In February last year, Seadrill and a number of its subsidiaries, including the current operator of West Linus, filed chapter 11 cases in the US Bankruptcy Court for the Southern District of Texas.

In connection with Seadrill’s expected emergence from chapter 11 in the near term, SFL said, the parties have now agreed that the drilling contract with ConocoPhillips Skandinavia AS will be assigned from the current operator to an SFL subsidiary.

SFL has simultaneously entered into an agreement for the operational management of the rig with a subsidiary of Odfjell Drilling Ltd, a harsh environment drilling rig operator.

The company said the change of operational management from Seadrill to Odfjell is subject to customary regulatory approvals relating to operations on the Norwegian Continental Shelf.

Until the approvals are in place, Seadrill will continue the existing charter arrangements for a period of up to approximately nine months.

The bareboat charter rate from Seadrill in this transition period will be approximately $55,000 per day, SFL said.

Upon effective assignment of the drilling contract, SFL will receive charter hire from the rig and pay for operating and management expenses.

Under the contract, the rig is earning a market adjusted rate which is based on market developments for similar jack-up rigs in the North Sea, and is adjusted on a semi-annual basis.

SFL said the current day rate and remaining contract length implies a charter backlog of approximately $500 million.