Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 26, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | DO | |
Entity Registrant Name | DIAMOND OFFSHORE DRILLING, INC. | |
Entity Central Index Key | 949,039 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 137,227,782 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 276,686 | $ 156,233 |
Accounts receivable, net of allowance for bad debts | 271,390 | 247,028 |
Prepaid expenses and other current assets | 97,803 | 102,146 |
Assets held for sale | 2,598 | 400 |
Total current assets | 648,477 | 505,807 |
Drilling and other property and equipment, net of accumulated depreciation | 5,432,689 | 5,726,935 |
Other assets | 117,062 | 139,135 |
Total assets | 6,198,228 | 6,371,877 |
Current liabilities: | ||
Accounts payable | 33,301 | 30,242 |
Accrued liabilities | 140,233 | 182,159 |
Taxes payable | 7,436 | 23,898 |
Short-term borrowings | 104,200 | |
Total current liabilities | 180,970 | 340,499 |
Long-term debt | 1,971,852 | 1,980,884 |
Deferred tax liability | 124,929 | 197,011 |
Other liabilities | 115,715 | 103,349 |
Total liabilities | 2,393,466 | 2,621,743 |
Commitments and contingencies (Note 8) | ||
Stockholders' equity: | ||
Preferred stock (par value $0.01, 25,000,000 shares authorized, none issued and outstanding) | ||
Common stock (par value $0.01, 500,000,000 shares authorized; 144,084,644 shares issued and 137,227,309 shares outstanding at September 30, 2017; 143,997,757 shares issued and 137,169,663 shares outstanding at December 31, 2016) | 1,441 | 1,440 |
Additional paid-in capital | 2,009,953 | 2,004,514 |
Retained earnings | 1,996,438 | 1,946,765 |
Accumulated other comprehensive (loss) gain | (3) | 1 |
Treasury stock, at cost (6,857,335 and 6,828,094 shares of common stock at September 30, 2017 and December 31, 2016, respectively) | (203,067) | (202,586) |
Total stockholders' equity | 3,804,762 | 3,750,134 |
Total liabilities and stockholders' equity | $ 6,198,228 | $ 6,371,877 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 144,084,644 | 143,997,757 |
Common stock, shares outstanding | 137,227,309 | 137,169,663 |
Treasury stock, shares | 6,857,335 | 6,828,094 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues: | ||||
Contract drilling | $ 357,683 | $ 339,636 | $ 1,113,410 | $ 1,140,568 |
Revenues related to reimbursable expenses | 8,340 | 9,542 | 26,128 | 67,900 |
Total revenues | 366,023 | 349,178 | 1,139,538 | 1,208,468 |
Operating expenses: | ||||
Contract drilling, excluding depreciation | 198,072 | 186,654 | 597,812 | 597,831 |
Reimbursable expenses | 8,220 | 7,965 | 25,488 | 51,283 |
Depreciation | 83,281 | 86,473 | 262,492 | 295,729 |
General and administrative | 17,806 | 15,237 | 54,299 | 48,774 |
Impairment of assets | 71,268 | 678,145 | ||
Loss (gain) on disposition of assets | 63 | (1,222) | (2,085) | (2,265) |
Total operating expenses | 307,442 | 295,107 | 1,009,274 | 1,669,497 |
Operating income (loss) | 58,581 | 54,071 | 130,264 | (461,029) |
Other income (expense): | ||||
Interest income | 776 | 150 | 1,347 | 592 |
Interest expense, net of amounts capitalized | (28,562) | (19,032) | (83,409) | (68,704) |
Loss on extinguishment of senior notes | (35,366) | (35,366) | ||
Foreign currency transaction loss | (677) | (712) | (517) | (7,833) |
Other, net | 1,447 | 269 | 1,322 | (11,199) |
(Loss) income before income tax benefit (expense) | (3,801) | 34,746 | 13,641 | (548,173) |
Income tax benefit (expense) | 14,600 | (20,819) | 36,646 | 59,588 |
Net income (loss) | $ 10,799 | $ 13,927 | $ 50,287 | $ (488,585) |
Earnings (loss) per share, Basic and Diluted | $ 0.08 | $ 0.10 | $ 0.37 | $ (3.56) |
Weighted-average shares outstanding: | ||||
Shares of common stock | 137,227 | 137,170 | 137,208 | 137,167 |
Dilutive potential shares of common stock | 14 | 84 | 29 | |
Total weighted-average shares outstanding | 137,241 | 137,254 | 137,237 | 137,167 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 10,799 | $ 13,927 | $ 50,287 | $ (488,585) |
Derivative financial instruments: | ||||
Reclassification adjustment for gain included in net income (loss) | (1) | (4) | (3) | |
Investments in marketable securities: | ||||
Unrealized holding loss | (1) | (6,559) | ||
Reclassification adjustment for loss included in net income (loss) | 11,600 | |||
Total other comprehensive (loss) gain | (1) | (1) | (4) | 5,038 |
Comprehensive income (loss) | $ 10,798 | $ 13,926 | $ 50,283 | $ (483,547) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements Of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities: | ||
Net income (loss) | $ 50,287 | $ (488,585) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation | 262,492 | 295,729 |
Loss on impairment of assets | 71,268 | 678,145 |
Loss on extinguishment of senior notes | 35,366 | |
Gain on disposition of assets | (2,085) | (2,265) |
Loss on sale of marketable securities | 12,146 | |
Deferred tax provision | (73,873) | (114,405) |
Stock-based compensation expense | 4,806 | 3,754 |
Deferred income, net | 8,379 | (23,381) |
Deferred expenses, net | 32,701 | (1,099) |
Other assets, noncurrent | (2,806) | (677) |
Other liabilities, noncurrent | (212) | 3,021 |
Other | 2,387 | 1,997 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (25,743) | 131,388 |
Prepaid expenses and other current assets | (4,831) | 3,950 |
Accounts payable and accrued liabilities | 17,787 | (32,762) |
Taxes payable | (9,288) | 25,038 |
Net cash provided by operating activities | 366,635 | 491,994 |
Investing activities: | ||
Capital expenditures (including rig construction) | (100,613) | (598,236) |
Proceeds from disposition of assets, net of disposal costs | 4,017 | 169,038 |
Proceeds from sale and maturities of marketable securities | 31 | 4,603 |
Net cash used in investing activities | (96,565) | (424,595) |
Financing activities: | ||
Redemption of senior notes | (500,000) | |
Payment of debt extinguishment costs | (34,395) | |
Proceeds from issuance of senior notes | 496,360 | |
Debt issuance costs and arrangement fees | (7,226) | |
Net repayment of short-term borrowings | (104,200) | (104,489) |
Other | (156) | (609) |
Net cash used in financing activities | (149,617) | (105,098) |
Net change in cash and cash equivalents | 120,453 | (37,699) |
Cash and cash equivalents, beginning of period | 156,233 | 119,028 |
Cash and cash equivalents, end of period | $ 276,686 | $ 81,329 |
General Information
General Information | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
General Information | 1. General Information The unaudited condensed consolidated financial statements of Diamond Offshore Drilling, Inc. and subsidiaries, which we refer to as “Diamond Offshore,” “we,” “us” or “our,” should be read in conjunction with our Annual Report on Form 10-K No. 1-13926). As of October 26, 2017, Loews Corporation owned approximately 53% of the outstanding shares of our common stock. Interim Financial Information The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S., or GAAP, for interim financial information and with the instructions to Form 10-Q S-X Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimated. Drilling and Other Property and Equipment We carry our drilling and other property and equipment at cost, less accumulated depreciation. Maintenance and routine repairs are charged to income currently while replacements and betterments that upgrade or increase the functionality of our existing equipment and that significantly extend the useful life of an existing asset are capitalized. During the nine-month period ended September 30, 2017 and the year ended December 31, 2016, we capitalized $33.7 million and $177.6 million, respectively, in replacements and betterments of our drilling fleet. See Note 6. Impairment of Long-Lived Assets We evaluate our property and equipment for impairment whenever changes in circumstances indicate that the carrying amount of an asset may not be recoverable (such as, but not limited to, a decision to retire, scrap or cold stack a rig, contracted backlog of less than one year for a rig, or excess spending over budget on a newbuild construction project or major rig upgrade). We utilize an undiscounted probability-weighted cash flow analysis in testing an asset for potential impairment. Our assumptions and estimates underlying this analysis include the following: • dayrate by rig; • utilization rate by rig if active, warm stacked or cold stacked (expressed as the actual percentage of time per year that the rig would be used at certain dayrates); • the per day operating cost for each rig if active, warm stacked or cold stacked; • the estimated annual cost for rig replacements and/or enhancement programs; • the estimated maintenance, inspection or other reactivation costs associated with a rig returning to work; • salvage value for each rig; and • estimated proceeds that may be received on disposition of each rig. Based on these assumptions, we develop a matrix for each rig under evaluation using multiple utilization/dayrate scenarios, to each of which we assign a probability of occurrence. We arrive at a projected probability-weighted cash flow for each rig based on the respective matrix and compare such amount to the carrying value of the asset to assess recoverability. The underlying assumptions and assigned probabilities of occurrence for utilization and dayrate scenarios are developed using a methodology that examines historical data for each rig, which considers the rig’s age, rated water depth and other attributes, and then assesses the rig’s future marketability in light of the current and projected market environment at the time of assessment. Other assumptions, such as operating, maintenance, inspection and reactivation costs, are estimated using historical data adjusted for known developments, cost projections for re-entry Management’s assumptions are necessarily subjective and are an inherent part of our asset impairment evaluation, and the use of different assumptions could produce results that differ from those reported. Our methodology generally involves the use of significant unobservable inputs, representative of a Level 3 fair value measurement, which may include assumptions related to future dayrate revenue, costs and rig utilization, quotes from rig brokers, the long-term future performance of our rigs and future market conditions. Management’s assumptions involve uncertainties about future demand for our services, dayrates, expenses and other future events, and management’s expectations may not be indicative of future outcomes. Significant unanticipated changes to these assumptions could materially alter our analysis in testing an asset for potential impairment. For example, changes in market conditions that exist at the measurement date or that are projected by management could affect our key assumptions. Other events or circumstances that could affect our assumptions may include, but are not limited to, a further sustained decline in oil and gas prices, cancelations of our drilling contracts or contracts of our competitors, contract modifications, costs to comply with new governmental regulations, growth in the global oversupply of oil and geopolitical events, such as lifting sanctions on oil-producing Capitalized Interest We capitalize interest cost for rig construction or upgrades, as well as other qualifying projects. A reconciliation of our total interest cost to “Interest expense, net of amounts capitalized” as reported in our Condensed Consolidated Statements of Operations is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Total interest cost, including amortization of debt issuance costs $ 28,590 $ 27,016 $ 83,440 $ 83,888 Capitalized interest (28 ) (7,984 ) (31 ) (15,184 ) Total interest expense as reported $ 28,562 $ 19,032 $ 83,409 $ 68,704 Stock-Based Compensation In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2016-09, Compensation - Stock Compensation (Topic 718) 2016-09. 2016-09 2016-09 The guidance requiring (i) excess tax benefits to be recorded in the condensed consolidated statement of operations, (ii) exclusion of excess tax benefits from the computation of assumed proceeds under the treasury stock method when calculating earnings per share, and (iii) presentation of excess tax benefits as an operating activity on the statement of cash flows, rather than as a financing activity, has been applied prospectively effective January 1, 2017. We have elected to account for forfeitures of share-based awards in the period in which such forfeitures occur rather than using an estimated forfeiture rate and have adopted this change using a modified retrospective approach, which resulted in a $0.6 million reduction in opening retained earnings. The impact to our Condensed Consolidated Balance Sheets is as follows: Retained Additional Paid-in Capital (In thousands) Balance as of January 1, 2017 before adoption $ 1,946,765 $ 2,004,514 Adjustment for making election to account for forfeitures as they occur (634 ) 634 Balance as of January 1, 2017 after adoption $ 1,946,131 $ 2,005,148 Recent Accounting Pronouncements In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, 2016-16. 2016-16 2016-16. 2016-16 In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments 2016-15. 2016-15 zero-coupon 2016-15 2016-15 2016-15 2016-15 In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) 2016-02, non-lease 2016-02, 2016-02 Non-lease 2014-09. 2016-02 2016-02 2016-02 2016-02 In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) 2014-09. 2014-09 2015-14, 2014-09. 2014-09 2014-09 When applying the new standard, we plan to account for the integrated services provided within our drilling contracts as a single performance obligation composed of a series of distinct time increments, which will be satisfied over time. We will determine the total transaction price for each individual contract by estimating both fixed and variable consideration expected to be earned over the term of the contract. Consideration that does not relate to a distinct good or service, such as mobilization, demobilization, and contract preparation revenue, will be allocated across the single performance obligation and recognized ratably over the term of the contract. All other components of consideration within a contract, including the dayrate revenue, will continue to be recognized in the period when the services are performed. We expect our revenue recognition under ASU 2014-09 |
Impairment of Assets
Impairment of Assets | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of Assets | 2. Impairment of Assets During the third quarter of 2017, we evaluated six drilling rigs with indicators of impairment. Based on our assumptions and analyses, we determined that the carrying values of these rigs were not impaired. If market fundamentals in the offshore oil and gas industry deteriorate further or a market recovery is delayed, we may be required to recognize additional impairment losses in future periods. During the second quarter of 2017, we evaluated seven of our drilling rigs with indicators of impairment. Due to the continued deterioration of market fundamentals in the contract drilling industry, as well as newly-available market projections, which indicated that a full market recovery is likely to occur further in the future than had previously been estimated, we determined that the carrying values of one ultra-deepwater and one deepwater semisubmersible rig were impaired (we collectively refer to these two rigs as the 2017 Impaired Rigs). We estimated the fair value of the 2017 Impaired Rigs using an income approach, whereby the fair value of each rig was estimated based on a calculation of the rig’s future net cash flows. As described in Note 1, these calculations utilized significant unobservable inputs, including estimated proceeds that may be received on ultimate disposition of the rig, and are representative of Level 3 fair value measurements due to the significant level of estimation involved and lack of transparency as to the inputs used. During the second quarter of 2017, we recorded an impairment loss of $71.3 million related to our 2017 Impaired Rigs. During the second quarter of 2016, we evaluated 15 of our drilling rigs with indicators of impairment. Based on our assumptions and analyses at that time, we determined that the carrying values of eight of these rigs, consisting of three ultra-deepwater, three deepwater and two mid-water |
Supplemental Financial Informat
Supplemental Financial Information | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Financial Information | 3. Supplemental Financial Information Condensed Consolidated Balance Sheets Information Accounts receivable, net of allowance for bad debts, consist of the following: September 30, December 31, 2017 2016 (In thousands) Trade receivables $ 265,476 $ 236,040 Value added tax receivables 10,425 14,639 Related party receivables 119 149 Other 829 1,659 276,849 252,487 Allowance for bad debts (5,459 ) (5,459 ) Total $ 271,390 $ 247,028 Prepaid expenses and other current assets consist of the following: September 30, December 31, 2017 2016 (In thousands) Rig spare parts and supplies $ 30,598 $ 25,343 Deferred rig start-up 52,544 61,488 Prepaid BOP lease 3,873 3,873 Prepaid insurance 3,808 3,771 Prepaid taxes 2,536 2,894 Other 4,444 4,777 Total $ 97,803 $ 102,146 Accrued liabilities consist of the following: September 30, December 31, 2017 2016 (In thousands) Rig operating expenses $ 35,612 $ 33,732 Payroll and benefits 42,275 45,619 Deferred revenue 8,911 9,522 Accrued capital project/upgrade costs 3,338 60,308 Interest payable 36,813 18,365 Personal injury and other claims 5,160 6,424 Other 8,124 8,189 Total $ 140,233 $ 182,159 Condensed Consolidated Statements of Cash Flows Information Noncash investing activities excluded from the Condensed Consolidated Statements of Cash Flows and other supplemental cash flow information is as follows: Nine Months Ended September 30, 2017 2016 (In thousands) Accrued but unpaid capital expenditures at period end $ 3,338 $ 65,286 Common stock withheld for payroll tax obligations (1) 481 181 Cash interest payments (2) 60,253 53,433 Cash income taxes paid, net of (refunds): Foreign 37,884 33,479 State 94 1 (1) Represents the cost of 29,241 shares and 7,923 shares of common stock withheld to satisfy payroll tax obligations incurred as a result of the vesting of restricted stock units in the nine months ended September 30, 2017 and 2016, respectively. These costs are presented as a deduction from stockholders’ equity in “Treasury stock” in our Condensed Consolidated Balance Sheets at September 30, 2017 and 2016. (2) Interest payments, net of amounts capitalized, were $60.2 million and $43.6 million for the nine-month periods ended September 30, 2017 and 2016, respectively. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 4. Earnings Per Share A reconciliation of the numerators and the denominators of our basic and diluted per-share Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands, except per share data) Net income (loss) – basic and diluted numerator $ 10,799 $ 13,927 $ 50,287 $ (488,585 ) Weighted average shares – basic (denominator): 137,227 137,170 137,208 137,167 Dilutive effect of stock-based awards 14 84 29 — Weighted average shares including conversions – diluted (denominator) 137,241 137,254 137,237 137,167 Earnings (loss) per share: Basic $ 0.08 $ 0.10 $ 0.37 $ (3.56 ) Diluted $ 0.08 $ 0.10 $ 0.37 $ (3.56 ) The following table sets forth the share effects of stock-based awards excluded from our computations of diluted earnings per share, or EPS, for the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Employee and director: Stock options — 6 1 8 Stock appreciation rights 1,297 1,469 1,330 1,519 Restricted stock units 1,061 423 977 687 |
Financial Instruments and Fair
Financial Instruments and Fair Value Disclosures | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments and Fair Value Disclosures | 5. Financial Instruments and Fair Value Disclosures Financial instruments that potentially subject us to significant concentrations of credit or market risk consist primarily of periodic temporary investments of excess cash, trade accounts receivable and investments in debt securities, including residential mortgage-backed securities. We generally place our excess cash investments in U.S. government-backed short-term money market instruments through several financial institutions. At times, such investments may be in excess of the insurable limit. We periodically evaluate the relative credit standing of these financial institutions as part of our investment strategy. Concentrations of credit risk with respect to our trade accounts receivable are limited primarily due to the entities comprising our customer base. Since the market for our services is the offshore oil and gas industry, this customer base has consisted primarily of major and independent oil and gas companies and government-owned oil companies. Based on our current customer base and the geographic areas in which we operate, we do not believe that we have any significant concentrations of credit risk at September 30, 2017. In general, before working for a customer with whom we have not had a prior business relationship and/or whose financial stability may be uncertain to us, we perform a credit review on that company. Based on that analysis, we may require that the customer present a letter of credit, prepay or provide other credit enhancements. We record a provision for bad debts on a case-by-case Fair Values Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy prescribed by GAAP requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1 Quoted prices for identical instruments in active markets. Level 1 assets include short-term investments such as money market funds and U.S. Treasury bills and notes. Our Level 1 assets at September 30, 2017 consisted of cash held in money market funds of $242.2 million and time deposits of $20.6 million. Our Level 1 assets at December 31, 2016 consisted of cash held in money market funds of $125.7 million and time deposits of $20.6 million. Level 2 Quoted market prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 assets and liabilities may include residential mortgage-backed securities, corporate bonds purchased in a private placement offering and over-the-counter Level 3 Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Level 3 assets and liabilities generally include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation or for which there is a lack of transparency as to the inputs used. Our Level 3 assets at September 30, 2017 and December 31, 2016 consisted of nonrecurring measurements of certain of our drilling rigs and associated spare parts and supplies for which we recorded impairment losses in the second quarter of 2017 and during 2016. Market conditions could cause an instrument to be reclassified among Levels 1, 2 and 3. Our policy regarding fair value measurements of financial instruments transferred into and out of levels is to reflect the transfers as having occurred at the beginning of the reporting period. There were no transfers between fair value levels during the nine-month period ended September 30, 2017 or the year ended December 31, 2016. Certain of our assets and liabilities are required to be measured at fair value on a recurring basis in accordance with GAAP. In addition, certain assets and liabilities may be recorded at fair value on a nonrecurring basis. Generally, we record assets at fair value on a nonrecurring basis as a result of impairment charges. We recorded impairment charges related to certain of our drilling rigs and related rig spare parts and supplies, which were measured at fair value on a nonrecurring basis, during each of the nine-month periods ended September 30, 2017 and 2016, of $71.3 million and $678.1 million, respectively. Assets and liabilities measured at fair value are summarized below. September 30, 2017 Fair Value Measurements Using Level 1 Level 2 Level 3 Assets at Total Losses for Nine (In thousands) Recurring fair value measurements: Assets: Short-term investments $ 262,887 $ — $ — $ 262,887 Mortgage-backed securities — 4 — 4 Total assets $ 262,887 $ 4 $ — $ 262,891 Nonrecurring fair value measurements: Assets: Impaired assets (1) $ — $ — $ 2,000 $ 2,000 $ 71,268 (1) Represents the total book value as of September 30, 2017 of one ultra-deepwater rig and one deepwater semisubmersible rig, which were written down to their estimated recoverable amounts during the second quarter of 2017 and were reported as “Drilling and other property and equipment, net of accumulated depreciation,” in our Condensed Consolidated Balance Sheets at September 30, 2017. December 31, 2016 Fair Value Measurements Using Level 1 Level 2 Level 3 Assets at Total Losses for Year (1) (In thousands) Recurring fair value measurements: Assets: Short-term investments $ 146,360 $ — $ — $ 146,360 Mortgage-backed securities — 35 — 35 Total assets $ 146,360 $ 35 $ — $ 146,395 Nonrecurring fair value measurements: Assets: Impaired assets (2) $ — $ — $ 69,153 $ 69,153 $ 678,145 (1) Represents impairment losses of $8.1 million and $670.0 million recognized during the year ended December 31, 2016 related to our rig spare parts and supplies and certain impaired rigs, respectively. (2) Represents the total book value as of December 31, 2016 for 11 drilling rigs ($45.5 million) and for rig spare parts and supplies ($23.6 million), which were previously written down to their estimated recoverable amounts. Of the total fair value, $23.6 million, $0.4 million and $45.1 million were reported as “Prepaid expenses and other current assets,” “Assets held for sale” and “Drilling and other property and equipment, net of accumulated depreciation,” respectively, in our Condensed Consolidated Balance Sheets at December 31, 2016. We believe that the carrying amounts of our other financial assets and liabilities (excluding long-term debt), which are not measured at fair value in our Condensed Consolidated Balance Sheets, approximate fair value based on the following assumptions: • Cash and cash equivalents • Accounts receivable and accounts payable • Short-term borrowings We consider our senior notes to be Level 2 liabilities under the GAAP fair value hierarchy and, accordingly, the fair value of our senior notes was derived using a third-party pricing service at September 30, 2017 and December 31, 2016. We perform control procedures over information we obtain from pricing services and brokers to test whether prices received represent a reasonable estimate of fair value. These procedures include the review of pricing service or broker pricing methodologies and comparing fair value estimates to actual trade activity executed in the market for these instruments occurring generally within a 10-day September 30, 2017 December 31, 2016 Fair Value Carrying Value Fair Value Carrying Value (In millions) 5.875% Senior Notes due 2019 $ — $ — $ 518.6 $ 499.8 3.45% Senior Notes due 2023 225.0 249.3 215.0 249.3 7.875% Senior Notes due 2025 528.8 496.4 — — 5.70% Senior Notes due 2039 411.3 497.1 392.5 497.1 4.875% Senior Notes due 2043 562.5 748.9 532.7 748.9 We have estimated the fair value amounts by using appropriate valuation methodologies and information available to management. Considerable judgment is required in developing these estimates, and accordingly, no assurance can be given that the estimated values are indicative of the amounts that would be realized in a free market exchange. See Note 7. |
Drilling and Other Property and
Drilling and Other Property and Equipment | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Drilling and Other Property and Equipment | 6. Drilling and Other Property and Equipment Cost and accumulated depreciation of drilling and other property and equipment are summarized as follows: September 30, December 31, 2017 2016 (In thousands) Drilling rigs and equipment $ 8,279,491 $ 8,950,385 Land and buildings 63,309 64,449 Office equipment and other 78,909 73,108 Cost 8,421,709 9,087,942 Less: accumulated depreciation (2,989,020 ) (3,361,007 ) Drilling and other property and equipment, net $ 5,432,689 $ 5,726,935 During the nine-month period ended September 30, 2017, we recognized an aggregate impairment loss of $71.3 million related to the 2017 Impaired Rigs. See Notes 1 and 2. |
Senior Notes
Senior Notes | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Senior Notes | 7. Senior Notes In August 2017, we issued $500.0 million aggregate principal amount of unsecured 7.875% senior notes due 2025, or 2025 Notes, and received net proceeds of $489.1 million after deducting underwriting discounts, commissions and estimated expenses. The 2025 Notes bear interest at 7.875% per year and mature on August 15, 2025. Interest on the 2025 Notes is payable semiannually in arrears on February 15 and August 15 of each year, beginning February 15, 2018. We used the net proceeds from the 2025 Notes, together with cash on hand, to fund the redemption of our 5.875% senior notes due 2019, or 2019 Notes. The 2025 Notes are unsecured obligations of Diamond Offshore Drilling, Inc., and rank equally in right of payment to all of its existing and future senior indebtedness, and are structurally subordinated to all existing and future obligations of our subsidiaries. We have the right to redeem some or all of the 2025 Notes at any time or from time to time, on at least 15 days but not more than 60 days prior written notice, at the applicable redemption price specified in the governing indenture, plus accrued and unpaid interest to, but excluding, the date of redemption. The 2025 Notes contain customary covenants including limitations on liens, mergers, consolidations and certain sales of assets and on entering into sale and lease-back transactions covering a drilling rig or drillship, as specified in the governing indenture. In August 2017, we redeemed all of our outstanding 2019 Notes for a redemption price of $543.0 million in the aggregate, including accrued and unpaid interest to the date of redemption. We accounted for the redemption as an extinguishment of debt and have reported a corresponding loss of $35.4 million in our Condensed Consolidated Statements of Operations for the three-month and nine-month periods ended September 30, 2017. At September 30, 2017, our outstanding senior notes were comprised of the following debt issues: Principal Semiannual Amount Interest Rate Interest Payment Debt Issue (In millions) Maturity Date Coupon Effective Dates 3.45% Senior Notes due 2023 $ 250.0 November 1, 2023 3.45 % 3.50 % May 1 and November 1 7.875% Senior Notes due 2025 $ 500.0 August 15, 2025 7.875 % 8.00 % February 15 and August 15 5.70% Senior Notes due 2039 $ 500.0 October 15, 2039 5.70 % 5.75 % April 15 and October 15 4.875% Senior Notes due 2043 $ 750.0 November 1, 2043 4.875 % 4.89 % May 1 and November 1 At September 30, 2017, the carrying value of our outstanding senior notes, net of unamortized discount and debt issuance costs, was as follows: September 30, (In thousands) 3.45% Senior Notes due 2023 $ 248,090 7.875% Senior Notes due 2025 489,200 5.70% Senior Notes due 2039 492,930 4.875% Senior Notes due 2043 741,632 Total senior notes, net $ 1,971,852 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. Commitments and Contingencies Various claims have been filed against us in the ordinary course of business, including claims by offshore workers alleging personal injuries. With respect to each claim or exposure, we have made an assessment, in accordance with GAAP, of the probability that the resolution of the matter would ultimately result in a loss. When we determine that an unfavorable resolution of a matter is probable and such amount of loss can be determined, we record a liability for the amount of the estimated loss at the time that both of these criteria are met. Our management believes that we have recorded adequate accruals for any liabilities that may reasonably be expected to result from these claims. Patent Litigation Ocean Blackhawk Ocean BlackHornet Ocean BlackRhino Ocean BlackLion Asbestos Litigation Other Litigation. NPI Arrangement. oil-and-gas pre- Personal Injury Claims The Jones Act is a federal law that permits seamen to seek compensation for certain injuries during the course of their employment on a vessel and governs the liability of vessel operators and marine employers for the work-related injury or death of an employee. We engage outside consultants to assist us in estimating our aggregate liability for personal injury claims based on our historical losses and utilizing various actuarial models. We allocate a portion of the aggregate liability to “Accrued liabilities” based on an estimate of claims expected to be paid within the next twelve months with the residual recorded as “Other liabilities.” At September 30, 2017 our estimated liability for personal injury claims was $31.2 million, of which $4.8 million and $26.4 million were recorded in “Accrued liabilities” and “Other liabilities,” respectively, in our Condensed Consolidated Balance Sheets. At December 31, 2016 our estimated liability for personal injury claims was $32.9 million, of which $6.1 million and $26.8 million were recorded in “Accrued liabilities” and “Other liabilities,” respectively, in our Condensed Consolidated Balance Sheets. The eventual settlement or adjudication of these claims could differ materially from our estimated amounts due to uncertainties such as: • the severity of personal injuries claimed; • significant changes in the volume of personal injury claims; • the unpredictability of legal jurisdictions where the claims will ultimately be litigated; • inconsistent court decisions; and • the risks and lack of predictability inherent in personal injury litigation. Letters of Credit and Other. |
Segments and Geographic Area An
Segments and Geographic Area Analysis | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segments and Geographic Area Analysis | 9. Segments and Geographic Area Analysis Although we provide contract drilling services with different types of offshore drilling rigs and also provide such services in many geographic locations, we have aggregated these operations into one reportable segment based on the similarity of economic characteristics due to the nature of the revenue-earning process as it relates to the offshore drilling industry over the operating lives of our drilling rigs. Revenues from contract drilling services by equipment type are listed below. Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Floaters: Ultra-Deepwater $ 275,859 $ 217,275 $ 801,859 $ 757,338 Deepwater 35,634 66,011 170,482 192,319 Mid-Water 39,616 56,350 124,444 160,716 Total Floaters 351,109 339,636 1,096,785 1,110,373 Jack-ups 6,574 — 16,625 30,195 Total contract drilling revenues 357,683 339,636 1,113,410 1,140,568 Revenues related to reimbursable expenses 8,340 9,542 26,128 67,900 Total revenues $ 366,023 $ 349,178 $ 1,139,538 $ 1,208,468 Geographic Areas Our drilling rigs are highly mobile and may be moved to other markets throughout the world in response to market conditions or customer needs. At September 30, 2017, our active drilling rigs were located offshore in five countries in addition to the United States. Revenues by geographic area are presented by attributing revenues to the individual country or areas where the services were performed. Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) United States $ 171,476 $ 121,895 $ 481,933 $ 414,087 International: South America 58,750 105,614 272,929 333,803 Australia/Asia 80,543 56,688 219,103 169,323 Europe 48,680 63,117 148,948 253,287 Mexico 6,574 1,864 16,625 37,968 Total revenues $ 366,023 $ 349,178 $ 1,139,538 $ 1,208,468 |
General Information (Policies)
General Information (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Interim Financial Information | Interim Financial Information The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S., or GAAP, for interim financial information and with the instructions to Form 10-Q S-X |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimated. |
Drilling and Other Property and Equipment | Drilling and Other Property and Equipment We carry our drilling and other property and equipment at cost, less accumulated depreciation. Maintenance and routine repairs are charged to income currently while replacements and betterments that upgrade or increase the functionality of our existing equipment and that significantly extend the useful life of an existing asset are capitalized. During the nine-month period ended September 30, 2017 and the year ended December 31, 2016, we capitalized $33.7 million and $177.6 million, respectively, in replacements and betterments of our drilling fleet. See Note 6. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We evaluate our property and equipment for impairment whenever changes in circumstances indicate that the carrying amount of an asset may not be recoverable (such as, but not limited to, a decision to retire, scrap or cold stack a rig, contracted backlog of less than one year for a rig, or excess spending over budget on a newbuild construction project or major rig upgrade). We utilize an undiscounted probability-weighted cash flow analysis in testing an asset for potential impairment. Our assumptions and estimates underlying this analysis include the following: • dayrate by rig; • utilization rate by rig if active, warm stacked or cold stacked (expressed as the actual percentage of time per year that the rig would be used at certain dayrates); • the per day operating cost for each rig if active, warm stacked or cold stacked; • the estimated annual cost for rig replacements and/or enhancement programs; • the estimated maintenance, inspection or other reactivation costs associated with a rig returning to work; • salvage value for each rig; and • estimated proceeds that may be received on disposition of each rig. Based on these assumptions, we develop a matrix for each rig under evaluation using multiple utilization/dayrate scenarios, to each of which we assign a probability of occurrence. We arrive at a projected probability-weighted cash flow for each rig based on the respective matrix and compare such amount to the carrying value of the asset to assess recoverability. The underlying assumptions and assigned probabilities of occurrence for utilization and dayrate scenarios are developed using a methodology that examines historical data for each rig, which considers the rig’s age, rated water depth and other attributes, and then assesses the rig’s future marketability in light of the current and projected market environment at the time of assessment. Other assumptions, such as operating, maintenance, inspection and reactivation costs, are estimated using historical data adjusted for known developments, cost projections for re-entry Management’s assumptions are necessarily subjective and are an inherent part of our asset impairment evaluation, and the use of different assumptions could produce results that differ from those reported. Our methodology generally involves the use of significant unobservable inputs, representative of a Level 3 fair value measurement, which may include assumptions related to future dayrate revenue, costs and rig utilization, quotes from rig brokers, the long-term future performance of our rigs and future market conditions. Management’s assumptions involve uncertainties about future demand for our services, dayrates, expenses and other future events, and management’s expectations may not be indicative of future outcomes. Significant unanticipated changes to these assumptions could materially alter our analysis in testing an asset for potential impairment. For example, changes in market conditions that exist at the measurement date or that are projected by management could affect our key assumptions. Other events or circumstances that could affect our assumptions may include, but are not limited to, a further sustained decline in oil and gas prices, cancelations of our drilling contracts or contracts of our competitors, contract modifications, costs to comply with new governmental regulations, growth in the global oversupply of oil and geopolitical events, such as lifting sanctions on oil-producing |
Capitalized Interest | Capitalized Interest We capitalize interest cost for rig construction or upgrades, as well as other qualifying projects. A reconciliation of our total interest cost to “Interest expense, net of amounts capitalized” as reported in our Condensed Consolidated Statements of Operations is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Total interest cost, including amortization of debt issuance costs $ 28,590 $ 27,016 $ 83,440 $ 83,888 Capitalized interest (28 ) (7,984 ) (31 ) (15,184 ) Total interest expense as reported $ 28,562 $ 19,032 $ 83,409 $ 68,704 |
Stock-Based Compensation | Stock-Based Compensation In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2016-09, Compensation - Stock Compensation (Topic 718) 2016-09. 2016-09 2016-09 The guidance requiring (i) excess tax benefits to be recorded in the condensed consolidated statement of operations, (ii) exclusion of excess tax benefits from the computation of assumed proceeds under the treasury stock method when calculating earnings per share, and (iii) presentation of excess tax benefits as an operating activity on the statement of cash flows, rather than as a financing activity, has been applied prospectively effective January 1, 2017. We have elected to account for forfeitures of share-based awards in the period in which such forfeitures occur rather than using an estimated forfeiture rate and have adopted this change using a modified retrospective approach, which resulted in a $0.6 million reduction in opening retained earnings. The impact to our Condensed Consolidated Balance Sheets is as follows: Retained Additional Paid-in Capital (In thousands) Balance as of January 1, 2017 before adoption $ 1,946,765 $ 2,004,514 Adjustment for making election to account for forfeitures as they occur (634 ) 634 Balance as of January 1, 2017 after adoption $ 1,946,131 $ 2,005,148 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, 2016-16. 2016-16 2016-16. 2016-16 In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments 2016-15. 2016-15 zero-coupon 2016-15 2016-15 2016-15 2016-15 In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) 2016-02, non-lease 2016-02, 2016-02 Non-lease 2014-09. 2016-02 2016-02 2016-02 2016-02 In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) 2014-09. 2014-09 2015-14, 2014-09. 2014-09 2014-09 When applying the new standard, we plan to account for the integrated services provided within our drilling contracts as a single performance obligation composed of a series of distinct time increments, which will be satisfied over time. We will determine the total transaction price for each individual contract by estimating both fixed and variable consideration expected to be earned over the term of the contract. Consideration that does not relate to a distinct good or service, such as mobilization, demobilization, and contract preparation revenue, will be allocated across the single performance obligation and recognized ratably over the term of the contract. All other components of consideration within a contract, including the dayrate revenue, will continue to be recognized in the period when the services are performed. We expect our revenue recognition under ASU 2014-09 |
General Information (Tables)
General Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Reconciliation of Total Interest Cost to Interest Expense | A reconciliation of our total interest cost to “Interest expense, net of amounts capitalized” as reported in our Condensed Consolidated Statements of Operations is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Total interest cost, including amortization of debt issuance costs $ 28,590 $ 27,016 $ 83,440 $ 83,888 Capitalized interest (28 ) (7,984 ) (31 ) (15,184 ) Total interest expense as reported $ 28,562 $ 19,032 $ 83,409 $ 68,704 |
Retrospective Effect of Adoption that Impacted on Balance Sheets | The impact to our Condensed Consolidated Balance Sheets is as follows: Retained Additional Paid-in Capital (In thousands) Balance as of January 1, 2017 before adoption $ 1,946,765 $ 2,004,514 Adjustment for making election to account for forfeitures as they occur (634 ) 634 Balance as of January 1, 2017 after adoption $ 1,946,131 $ 2,005,148 |
Supplemental Financial Inform18
Supplemental Financial Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Accounts Receivable, Net of Allowance for Doubtful Accounts | Accounts receivable, net of allowance for bad debts, consist of the following: September 30, December 31, 2017 2016 (In thousands) Trade receivables $ 265,476 $ 236,040 Value added tax receivables 10,425 14,639 Related party receivables 119 149 Other 829 1,659 276,849 252,487 Allowance for bad debts (5,459 ) (5,459 ) Total $ 271,390 $ 247,028 |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following: September 30, December 31, 2017 2016 (In thousands) Rig spare parts and supplies $ 30,598 $ 25,343 Deferred rig start-up 52,544 61,488 Prepaid BOP lease 3,873 3,873 Prepaid insurance 3,808 3,771 Prepaid taxes 2,536 2,894 Other 4,444 4,777 Total $ 97,803 $ 102,146 |
Accrued Liabilities | Accrued liabilities consist of the following: September 30, December 31, 2017 2016 (In thousands) Rig operating expenses $ 35,612 $ 33,732 Payroll and benefits 42,275 45,619 Deferred revenue 8,911 9,522 Accrued capital project/upgrade costs 3,338 60,308 Interest payable 36,813 18,365 Personal injury and other claims 5,160 6,424 Other 8,124 8,189 Total $ 140,233 $ 182,159 |
Noncash Investing and Financing Activities | Noncash investing activities excluded from the Condensed Consolidated Statements of Cash Flows and other supplemental cash flow information is as follows: Nine Months Ended September 30, 2017 2016 (In thousands) Accrued but unpaid capital expenditures at period end $ 3,338 $ 65,286 Common stock withheld for payroll tax obligations (1) 481 181 Cash interest payments (2) 60,253 53,433 Cash income taxes paid, net of (refunds): Foreign 37,884 33,479 State 94 1 (1) Represents the cost of 29,241 shares and 7,923 shares of common stock withheld to satisfy payroll tax obligations incurred as a result of the vesting of restricted stock units in the nine months ended September 30, 2017 and 2016, respectively. These costs are presented as a deduction from stockholders’ equity in “Treasury stock” in our Condensed Consolidated Balance Sheets at September 30, 2017 and 2016. (2) Interest payments, net of amounts capitalized, were $60.2 million and $43.6 million for the nine-month periods ended September 30, 2017 and 2016, respectively. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of Numerators and Denominators of Basic and Diluted Per-Share Computations | A reconciliation of the numerators and the denominators of our basic and diluted per-share Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands, except per share data) Net income (loss) – basic and diluted numerator $ 10,799 $ 13,927 $ 50,287 $ (488,585 ) Weighted average shares – basic (denominator): 137,227 137,170 137,208 137,167 Dilutive effect of stock-based awards 14 84 29 — Weighted average shares including conversions – diluted (denominator) 137,241 137,254 137,237 137,167 Earnings (loss) per share: Basic $ 0.08 $ 0.10 $ 0.37 $ (3.56 ) Diluted $ 0.08 $ 0.10 $ 0.37 $ (3.56 ) |
Securities Excluded from Computation of Diluted Earning Per Share | The following table sets forth the share effects of stock-based awards excluded from our computations of diluted earnings per share, or EPS, for the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Employee and director: Stock options — 6 1 8 Stock appreciation rights 1,297 1,469 1,330 1,519 Restricted stock units 1,061 423 977 687 |
Financial Instruments and Fai20
Financial Instruments and Fair Value Disclosures (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | Assets and liabilities measured at fair value are summarized below. September 30, 2017 Fair Value Measurements Using Level 1 Level 2 Level 3 Assets at Total Losses for Nine (In thousands) Recurring fair value measurements: Assets: Short-term investments $ 262,887 $ — $ — $ 262,887 Mortgage-backed securities — 4 — 4 Total assets $ 262,887 $ 4 $ — $ 262,891 Nonrecurring fair value measurements: Assets: Impaired assets (1) $ — $ — $ 2,000 $ 2,000 $ 71,268 (1) Represents the total book value as of September 30, 2017 of one ultra-deepwater rig and one deepwater semisubmersible rig, which were written down to their estimated recoverable amounts during the second quarter of 2017 and were reported as “Drilling and other property and equipment, net of accumulated depreciation,” in our Condensed Consolidated Balance Sheets at September 30, 2017. December 31, 2016 Fair Value Measurements Using Level 1 Level 2 Level 3 Assets at Total Losses for Year (1) (In thousands) Recurring fair value measurements: Assets: Short-term investments $ 146,360 $ — $ — $ 146,360 Mortgage-backed securities — 35 — 35 Total assets $ 146,360 $ 35 $ — $ 146,395 Nonrecurring fair value measurements: Assets: Impaired assets (2) $ — $ — $ 69,153 $ 69,153 $ 678,145 (1) Represents impairment losses of $8.1 million and $670.0 million recognized during the year ended December 31, 2016 related to our rig spare parts and supplies and certain impaired rigs, respectively. (2) Represents the total book value as of December 31, 2016 for 11 drilling rigs ($45.5 million) and for rig spare parts and supplies ($23.6 million), which were previously written down to their estimated recoverable amounts. Of the total fair value, $23.6 million, $0.4 million and $45.1 million were reported as “Prepaid expenses and other current assets,” “Assets held for sale” and “Drilling and other property and equipment, net of accumulated depreciation,” respectively, in our Condensed Consolidated Balance Sheets at December 31, 2016. |
Fair Values and Related Carrying Values of Our Debt Instruments | September 30, 2017 December 31, 2016 Fair Value Carrying Value Fair Value Carrying Value (In millions) 5.875% Senior Notes due 2019 $ — $ — $ 518.6 $ 499.8 3.45% Senior Notes due 2023 225.0 249.3 215.0 249.3 7.875% Senior Notes due 2025 528.8 496.4 — — 5.70% Senior Notes due 2039 411.3 497.1 392.5 497.1 4.875% Senior Notes due 2043 562.5 748.9 532.7 748.9 |
Drilling and Other Property a21
Drilling and Other Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Summary of Cost and Accumulated Depreciation of Drilling and Other Property and Equipment | Cost and accumulated depreciation of drilling and other property and equipment are summarized as follows: September 30, December 31, 2017 2016 (In thousands) Drilling rigs and equipment $ 8,279,491 $ 8,950,385 Land and buildings 63,309 64,449 Office equipment and other 78,909 73,108 Cost 8,421,709 9,087,942 Less: accumulated depreciation (2,989,020 ) (3,361,007 ) Drilling and other property and equipment, net $ 5,432,689 $ 5,726,935 |
Senior Notes (Tables)
Senior Notes (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Summary of Outstanding Senior Notes | At September 30, 2017, our outstanding senior notes were comprised of the following debt issues: Principal Semiannual Amount Interest Rate Interest Payment Debt Issue (In millions) Maturity Date Coupon Effective Dates 3.45% Senior Notes due 2023 $ 250.0 November 1, 2023 3.45 % 3.50 % May 1 and November 1 7.875% Senior Notes due 2025 $ 500.0 August 15, 2025 7.875 % 8.00 % February 15 and August 15 5.70% Senior Notes due 2039 $ 500.0 October 15, 2039 5.70 % 5.75 % April 15 and October 15 4.875% Senior Notes due 2043 $ 750.0 November 1, 2043 4.875 % 4.89 % May 1 and November 1 |
Summary of Carrying Value of Outstanding Senior Notes, Net of Unamortized Discount and Debt Issuance Costs | At September 30, 2017, the carrying value of our outstanding senior notes, net of unamortized discount and debt issuance costs, was as follows: September 30, (In thousands) 3.45% Senior Notes due 2023 $ 248,090 7.875% Senior Notes due 2025 489,200 5.70% Senior Notes due 2039 492,930 4.875% Senior Notes due 2043 741,632 Total senior notes, net $ 1,971,852 |
Segments and Geographic Area 23
Segments and Geographic Area Analysis (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Revenues from Contract Drilling Services by Equipment Type | Revenues from contract drilling services by equipment type are listed below. Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Floaters: Ultra-Deepwater $ 275,859 $ 217,275 $ 801,859 $ 757,338 Deepwater 35,634 66,011 170,482 192,319 Mid-Water 39,616 56,350 124,444 160,716 Total Floaters 351,109 339,636 1,096,785 1,110,373 Jack-ups 6,574 — 16,625 30,195 Total contract drilling revenues 357,683 339,636 1,113,410 1,140,568 Revenues related to reimbursable expenses 8,340 9,542 26,128 67,900 Total revenues $ 366,023 $ 349,178 $ 1,139,538 $ 1,208,468 |
Revenues by Geographic Area Presented by Attributing Revenues to Individual Country | Revenues by geographic area are presented by attributing revenues to the individual country or areas where the services were performed. Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) United States $ 171,476 $ 121,895 $ 481,933 $ 414,087 International: South America 58,750 105,614 272,929 333,803 Australia/Asia 80,543 56,688 219,103 169,323 Europe 48,680 63,117 148,948 253,287 Mexico 6,574 1,864 16,625 37,968 Total revenues $ 366,023 $ 349,178 $ 1,139,538 $ 1,208,468 |
General Information - Additiona
General Information - Additional Information (Detail) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | Oct. 26, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Amount capitalized for asset replacements and betterments | $ 33.7 | $ 177.6 | |
Adjustments for New Accounting Principle Adoption [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Reduction in retained earnings | $ 0.6 | ||
Subsequent Event [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Outstanding common stock owned by Loews Corporation | 53.00% |
General Information - Reconcili
General Information - Reconciliation of Total Interest Cost to Interest Expense, Net of Amounts Capitalized (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Interest Costs Incurred [Abstract] | ||||
Total interest cost, including amortization of debt issuance costs | $ 28,590 | $ 27,016 | $ 83,440 | $ 83,888 |
Capitalized interest | (28) | (7,984) | (31) | (15,184) |
Total interest expense as reported | $ 28,562 | $ 19,032 | $ 83,409 | $ 68,704 |
General Information - Retrospec
General Information - Retrospective Effect of Adoption that Impacted on Balance Sheets (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Jan. 01, 2017 | Dec. 31, 2016 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Retained earnings | $ 1,996,438 | $ 1,946,131 | $ 1,946,765 |
Additional paid-in capital | $ 2,009,953 | 2,005,148 | $ 2,004,514 |
Scenario, Previously Reported [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Retained earnings | 1,946,765 | ||
Additional paid-in capital | 2,004,514 | ||
Restatement Adjustment [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Retained earnings | (634) | ||
Additional paid-in capital | $ 634 |
Impairments of Assets - Additio
Impairments of Assets - Additional Information (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017Rigs | Jun. 30, 2017USD ($)Rigs | Jun. 30, 2016USD ($)Rigs | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | |
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Loss on impairment of assets | $ | $ 71,268 | $ 678,145 | ||||
2017 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs evaluated for impairment | 6 | 7 | ||||
Number of rigs impaired | 2 | |||||
Loss on impairment of assets | $ | $ 71,300 | $ 71,300 | ||||
2016 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs evaluated for impairment | 15 | |||||
Number of rigs impaired | 8 | |||||
Loss on impairment of assets | $ | $ 670,000 | $ 670,000 | ||||
Ultra-Deepwater Rigs [Member] | 2017 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs impaired | 1 | |||||
Ultra-Deepwater Rigs [Member] | 2016 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs impaired | 3 | |||||
Deepwater Semisubmersible Rigs [Member] | 2017 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs impaired | 1 | |||||
Deep Water Rigs [Member] | 2016 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs impaired | 3 | |||||
Mid-Water Drilling Rigs [Member] | 2016 Impaired Rigs [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Number of rigs impaired | 2 | |||||
Rig Spare Parts and Supplies [Member] | ||||||
Schedule Of Asset Impairment Charges [Line Items] | ||||||
Loss on impairment of assets | $ | $ 8,100 | $ 8,100 |
Supplemental Financial Inform28
Supplemental Financial Information - Accounts Receivable, Net of Allowance for Doubtful Accounts (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Trade receivables | $ 265,476 | $ 236,040 |
Value added tax receivables | 10,425 | 14,639 |
Related party receivables | 119 | 149 |
Other | 829 | 1,659 |
Receivables Gross Current, Total | 276,849 | 252,487 |
Allowance for bad debts | (5,459) | (5,459) |
Total | $ 271,390 | $ 247,028 |
Supplemental Financial Inform29
Supplemental Financial Information - Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Rig spare parts and supplies | $ 30,598 | $ 25,343 |
Deferred rig start-up costs | 52,544 | 61,488 |
Prepaid BOP lease | 3,873 | 3,873 |
Prepaid insurance | 3,808 | 3,771 |
Prepaid taxes | 2,536 | 2,894 |
Other | 4,444 | 4,777 |
Total | $ 97,803 | $ 102,146 |
Supplemental Financial Inform30
Supplemental Financial Information - Accrued Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Rig operating expenses | $ 35,612 | $ 33,732 |
Payroll and benefits | 42,275 | 45,619 |
Deferred revenue | 8,911 | 9,522 |
Accrued capital project/upgrade costs | 3,338 | 60,308 |
Interest payable | 36,813 | 18,365 |
Personal injury and other claims | 5,160 | 6,424 |
Other | 8,124 | 8,189 |
Total | $ 140,233 | $ 182,159 |
Supplemental Financial Inform31
Supplemental Financial Information - Noncash Investing and Financing Activities (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Condensed Financial Statements, Captions [Line Items] | ||
Accrued but unpaid capital expenditures at period end | $ 3,338 | $ 65,286 |
Common stock withheld for payroll tax obligations | 481 | 181 |
Cash interest payments | 60,253 | 53,433 |
Foreign [Member] | ||
Cash income taxes paid, net of (refunds): | ||
Cash income taxes paid, net of refunds | 37,884 | 33,479 |
State [Member] | ||
Cash income taxes paid, net of (refunds): | ||
Cash income taxes paid, net of refunds | $ 94 | $ 1 |
Supplemental Financial Inform32
Supplemental Financial Information - Noncash Investing and Financing Activities (Parenthetical) (Detail) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Condensed Financial Statements, Captions [Line Items] | ||
Interest payments, net of amounts capitalized | $ 60.2 | $ 43.6 |
Restricted Stock [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Number of shares of common stock withheld | 29,241 | 7,923 |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation of Numerators and Denominators of Basic and Diluted Per-Share Computations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) - basic and diluted numerator | $ 10,799 | $ 13,927 | $ 50,287 | $ (488,585) |
Weighted average shares - basic (denominator): | 137,227 | 137,170 | 137,208 | 137,167 |
Dilutive effect of stock-based awards | 14 | 84 | 29 | |
Weighted average shares including conversions - diluted (denominator) | 137,241 | 137,254 | 137,237 | 137,167 |
Earnings (loss) per share: | ||||
Basic | $ 0.08 | $ 0.10 | $ 0.37 | $ (3.56) |
Diluted | $ 0.08 | $ 0.10 | $ 0.37 | $ (3.56) |
Earnings Per Share - Securities
Earnings Per Share - Securities Excluded from Computation of Diluted Earning Per Share (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Stock Options [Member] | ||||
Employee and director: | ||||
Securities excluded from computation of diluted earning per share | 6 | 1 | 8 | |
Restricted Stock Units [Member] | ||||
Employee and director: | ||||
Securities excluded from computation of diluted earning per share | 1,061 | 423 | 977 | 687 |
Stock Appreciation Rights [Member] | ||||
Employee and director: | ||||
Securities excluded from computation of diluted earning per share | 1,297 | 1,469 | 1,330 | 1,519 |
Financial Instruments and Fai35
Financial Instruments and Fair Value Disclosures - Additional Information (Detail) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Transfers between fair value levels | $ 0 | $ 0 | |
Impairment charges | $ 71,268,000 | $ 678,145,000 | |
Measurement period for determining fair value of debt instruments | 10 days | ||
Level 1 [Member] | Cash Held in Money Market Funds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of investments | $ 242,200,000 | 125,700,000 | |
Level 1 [Member] | Time Deposits [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of investments | $ 20,600,000 | $ 20,600,000 |
Financial Instruments and Fai36
Financial Instruments and Fair Value Disclosures - Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Assets: | |||
Loss on assets | $ 71,268 | $ 678,145 | |
Carrying value of impaired assets | $ 45,100 | ||
Fair Value Measurements, Recurring [Member] | |||
Assets: | |||
Short-term investments | 262,887 | 146,360 | |
Mortgage-backed securities | 4 | 35 | |
Total assets | 262,891 | 146,395 | |
Fair Value Measurements, Recurring [Member] | Level 1 [Member] | |||
Assets: | |||
Short-term investments | 262,887 | 146,360 | |
Total assets | 262,887 | 146,360 | |
Fair Value Measurements, Recurring [Member] | Level 2 [Member] | |||
Assets: | |||
Mortgage-backed securities | 4 | 35 | |
Total assets | 4 | 35 | |
Nonrecurring Fair Value Measurements [Member] | |||
Assets: | |||
Loss on assets | 71,268 | 678,145 | |
Carrying value of impaired assets | 2,000 | 69,153 | |
Nonrecurring Fair Value Measurements [Member] | Level 3 [Member] | |||
Assets: | |||
Carrying value of impaired assets | $ 2,000 | $ 69,153 |
Financial Instruments and Fai37
Financial Instruments and Fair Value Disclosures - Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis (Parenthetical) (Detail) $ in Thousands | Dec. 31, 2016USD ($)Rigs | Jun. 30, 2016USD ($) | Sep. 30, 2017USD ($)Rigs | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loss on impairment of assets | $ 71,268 | $ 678,145 | |||
Book value of physical assets | $ 5,726,935 | 5,432,689 | $ 5,726,935 | ||
Carrying value of impaired assets | 45,100 | 45,100 | |||
Asset held for sale | 400 | 2,598 | 400 | ||
Rig Spare Parts and Supplies [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loss on impairment of assets | $ 8,100 | 8,100 | |||
Carrying value of impaired assets | 23,600 | 23,600 | |||
2016 Impaired Rigs [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loss on impairment of assets | $ 670,000 | 670,000 | |||
Nonrecurring Fair Value Measurements [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loss on impairment of assets | 71,268 | 678,145 | |||
Carrying value of impaired assets | $ 69,153 | $ 2,000 | 69,153 | ||
Nonrecurring Fair Value Measurements [Member] | Drilling Rigs [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Number of rigs written down to their estimated recoverable amounts | Rigs | 11 | ||||
Book value of physical assets | $ 45,500 | 45,500 | |||
Nonrecurring Fair Value Measurements [Member] | Ultra-Deepwater Rigs [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Number of rigs written down to their estimated recoverable amounts | Rigs | 1 | ||||
Nonrecurring Fair Value Measurements [Member] | Deepwater Semisubmersible Rigs [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Number of rigs written down to their estimated recoverable amounts | Rigs | 1 | ||||
Prepaid Expenses and Other Current Assets [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Carrying value of impaired assets | $ 23,600 | $ 23,600 |
Financial Instruments and Fai38
Financial Instruments and Fair Value Disclosures - Fair Value and Related Carrying Values of Our Debt Instruments (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
5.875% Senior Notes due 2019 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | $ 518.6 | |
Carrying Value | 499.8 | |
3.45% Senior Notes due 2023 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | $ 225 | 215 |
Carrying Value | 249.3 | 249.3 |
7.875% Senior Notes due 2025 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 528.8 | |
Carrying Value | 496.4 | |
5.70% Senior Notes due 2039 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 411.3 | 392.5 |
Carrying Value | 497.1 | 497.1 |
4.875% Senior Notes due 2043 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair Value | 562.5 | 532.7 |
Carrying Value | $ 748.9 | $ 748.9 |
Financial Instruments and Fai39
Financial Instruments and Fair Value Disclosures - Fair Value and Related Carrying Values of Our Debt Instruments (Parenthetical) (Detail) | Sep. 30, 2017 | Aug. 31, 2017 | Dec. 31, 2016 |
5.875% Senior Notes due 2019 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate of senior notes | 5.875% | 5.875% | |
3.45% Senior Notes due 2023 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate of senior notes | 3.45% | 3.45% | |
7.875% Senior Notes due 2025 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate of senior notes | 7.875% | 7.875% | 7.875% |
5.70% Senior Notes due 2039 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate of senior notes | 5.70% | 5.70% | |
4.875% Senior Notes due 2043 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate of senior notes | 4.875% | 4.875% |
Drilling and Other Property a40
Drilling and Other Property and Equipment - Summary of Cost and Accumulated Depreciation of Drilling and Other Property and Equipment (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 8,421,709 | $ 9,087,942 |
Less: accumulated depreciation | (2,989,020) | (3,361,007) |
Drilling and other property and equipment, net | 5,432,689 | 5,726,935 |
Drilling Rigs and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 8,279,491 | 8,950,385 |
Land and Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 63,309 | 64,449 |
Office Equipment and Other [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 78,909 | $ 73,108 |
Drilling and Other Property a41
Drilling and Other Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Loss on impairment of assets | $ 71,268 | $ 678,145 | |
2017 Impaired Rigs [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Loss on impairment of assets | $ 71,300 | $ 71,300 |
Senior Notes - Additional Infor
Senior Notes - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |
Aug. 31, 2017 | Sep. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||
Proceeds from issuance of senior notes | $ 496,360,000 | |||
Loss on extinguishment of senior notes | $ 35,366,000 | 35,366,000 | ||
7.875% Senior Notes due 2025 [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount of senior unsecured notes | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | |
Proceeds from issuance of senior notes | $ 489,100,000 | |||
Interest rate of senior notes | 7.875% | 7.875% | 7.875% | 7.875% |
Maturity Date | Aug. 15, 2025 | Aug. 15, 2025 | ||
7.875% Senior Notes due 2025 [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Senior notes redemption period prior written notice | 15 days | |||
7.875% Senior Notes due 2025 [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Senior notes redemption period prior written notice | 60 days | |||
5.875% Senior Notes due 2019 [Member] | ||||
Debt Instrument [Line Items] | ||||
Interest rate of senior notes | 5.875% | 5.875% | 5.875% | |
Redemption of outstanding senior notes | $ 543,000,000 | |||
Loss on extinguishment of senior notes | $ 35,400,000 | $ 35,400,000 |
Senior Notes - Summary of Outst
Senior Notes - Summary of Outstanding Senior Notes (Detail) - USD ($) | 1 Months Ended | 9 Months Ended | |
Aug. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
3.45% Senior Notes due 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate Principal Amount | $ 250,000,000 | ||
Maturity Date | Nov. 1, 2023 | ||
Interest rate Coupon, senior notes | 3.45% | 3.45% | |
Interest rate Effective, senior notes | 3.50% | ||
Semiannual Interest Payment Dates | May 1 and November 1 | ||
7.875% Senior Notes due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate Principal Amount | $ 500,000,000 | $ 500,000,000 | |
Maturity Date | Aug. 15, 2025 | Aug. 15, 2025 | |
Interest rate Coupon, senior notes | 7.875% | 7.875% | 7.875% |
Interest rate Effective, senior notes | 8.00% | ||
Semiannual Interest Payment Dates | February 15 and August 15 | ||
5.70% Senior Notes due 2039 [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate Principal Amount | $ 500,000,000 | ||
Maturity Date | Oct. 15, 2039 | ||
Interest rate Coupon, senior notes | 5.70% | 5.70% | |
Interest rate Effective, senior notes | 5.75% | ||
Semiannual Interest Payment Dates | April 15 and October 15 | ||
4.875% Senior Notes due 2043 [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate Principal Amount | $ 750,000,000 | ||
Maturity Date | Nov. 1, 2043 | ||
Interest rate Coupon, senior notes | 4.875% | 4.875% | |
Interest rate Effective, senior notes | 4.89% | ||
Semiannual Interest Payment Dates | May 1 and November 1 |
Senior Notes - Summary of Out44
Senior Notes - Summary of Outstanding Senior Notes (Parenthetical) (Detail) | Sep. 30, 2017 | Aug. 31, 2017 | Dec. 31, 2016 |
3.45% Senior Notes due 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 3.45% | 3.45% | |
7.875% Senior Notes due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 7.875% | 7.875% | 7.875% |
5.70% Senior Notes due 2039 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 5.70% | 5.70% | |
4.875% Senior Notes due 2043 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 4.875% | 4.875% |
Senior Notes - Summary of Carry
Senior Notes - Summary of Carrying Value of Outstanding Senior Notes, Net of Unamortized Discount and Debt Issuance Costs (Detail) $ in Thousands | Sep. 30, 2017USD ($) |
Debt Instrument [Line Items] | |
Senior Notes | $ 1,971,852 |
3.45% Senior Notes due 2023 [Member] | |
Debt Instrument [Line Items] | |
Senior Notes | 248,090 |
7.875% Senior Notes due 2025 [Member] | |
Debt Instrument [Line Items] | |
Senior Notes | 489,200 |
5.70% Senior Notes due 2039 [Member] | |
Debt Instrument [Line Items] | |
Senior Notes | 492,930 |
4.875% Senior Notes due 2043 [Member] | |
Debt Instrument [Line Items] | |
Senior Notes | $ 741,632 |
Senior Notes - Summary of Car46
Senior Notes - Summary of Carrying Value of Outstanding Senior Notes, Net of Unamortized Discount and Debt Issuance Costs (Parenthetical) (Detail) | Sep. 30, 2017 | Aug. 31, 2017 | Dec. 31, 2016 |
3.45% Senior Notes due 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 3.45% | 3.45% | |
7.875% Senior Notes due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 7.875% | 7.875% | 7.875% |
5.70% Senior Notes due 2039 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 5.70% | 5.70% | |
4.875% Senior Notes due 2043 [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate of senior notes | 4.875% | 4.875% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) | 1 Months Ended | 9 Months Ended | |
Oct. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
Contingencies And Commitments [Line Items] | |||
Disgorgement claims, limit | $ 17,000,000 | ||
Deductible for marine liability coverage including personal injury claims, per first occurrence | 10,000,000 | ||
Range of deductible for liability coverage for personal injury claims, lower limit | 5,000,000 | ||
Range of deductible for liability coverage for personal injury claims, upper limit | 100,000,000 | ||
Total Contingent Liabilities Under Letters of Credit and Bonds [Member] | |||
Contingencies And Commitments [Line Items] | |||
Contingent liability under letters of credit and other bonds | 21,300,000 | ||
Potentially Collateralized Contingent Liability Under Letters Of Credit and Bonds [Member] | |||
Contingencies And Commitments [Line Items] | |||
Contingent liability under letters of credit and other bonds | 15,600,000 | ||
NPI Arrangement [Member] | |||
Contingencies And Commitments [Line Items] | |||
Payments received from customer after bankruptcy filing | 3,250,000 | ||
Payments received from customer before and after bankruptcy filing | 30,000,000 | ||
Subsequent Event [Member] | |||
Contingencies And Commitments [Line Items] | |||
Disgorgement claims, amount settled | $ 17,000,000 | ||
Windstorms in U.S. Gulf of Mexico [Member] | |||
Contingencies And Commitments [Line Items] | |||
Deductible for marine liability coverage including personal injury claims, per first occurrence | 25,000,000 | ||
Range of deductible for liability coverage for personal injury claims, lower limit | 25,000,000 | ||
Range of deductible for liability coverage for personal injury claims, upper limit | 100,000,000 | ||
Personal Injury Claims [Member] | |||
Contingencies And Commitments [Line Items] | |||
Personal injury claims recorded | 31,200,000 | $ 32,900,000 | |
Personal Injury Claims [Member] | Accrued Liabilities [Member] | |||
Contingencies And Commitments [Line Items] | |||
Personal injury claims recorded | 4,800,000 | 6,100,000 | |
Personal Injury Claims [Member] | Other Liabilities [Member] | |||
Contingencies And Commitments [Line Items] | |||
Personal injury claims recorded | $ 26,400,000 | $ 26,800,000 |
Segments and Geographic Area 48
Segments and Geographic Area Analysis - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017CountrySegment | |
Segment Reporting [Abstract] | |
Number of reportable segments | Segment | 1 |
Number of countries with rigs | Country | 5 |
Segments and Geographic Area 49
Segments and Geographic Area Analysis - Revenues from Contract Drilling Services by Equipment Type (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Contract drilling | $ 357,683 | $ 339,636 | $ 1,113,410 | $ 1,140,568 |
Revenues related to reimbursable expenses | 8,340 | 9,542 | 26,128 | 67,900 |
Total revenues | 366,023 | 349,178 | 1,139,538 | 1,208,468 |
Ultra-Deepwater Rigs [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Contract drilling | 275,859 | 217,275 | 801,859 | 757,338 |
Deepwater [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Contract drilling | 35,634 | 66,011 | 170,482 | 192,319 |
Mid-Water [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Contract drilling | 39,616 | 56,350 | 124,444 | 160,716 |
Total Floaters [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Contract drilling | 351,109 | $ 339,636 | 1,096,785 | 1,110,373 |
Jack-ups [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Contract drilling | $ 6,574 | $ 16,625 | $ 30,195 |
Segments and Geographic Area 50
Segments and Geographic Area Analysis - Revenues by Geographic Area Presented by Attributing Revenues to Individual Country (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenues | $ 366,023 | $ 349,178 | $ 1,139,538 | $ 1,208,468 |
United States [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenues | 171,476 | 121,895 | 481,933 | 414,087 |
South America [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenues | 58,750 | 105,614 | 272,929 | 333,803 |
Australia/Asia [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenues | 80,543 | 56,688 | 219,103 | 169,323 |
Europe [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenues | 48,680 | 63,117 | 148,948 | 253,287 |
Mexico [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenues | $ 6,574 | $ 1,864 | $ 16,625 | $ 37,968 |