Offshore driller Seadrill’s CEO has stood down, as the company’s board revealed plans to implement a new management structure and a possible relocation.
The board said that after discussions with Alf C. Thorkildsen, they had mutually agreed to terminate his contract. Thorkildsen will remain on the board of North Atlantic Drilling Ltd., a majority-owned subsidiary of Seadrill.
Fredrik Halvorsen, currently the CEO of Archer Ltd.,, has been appointed to succeed Thorkildsen.
The plans to implement the new management structure were announced “to ensure continued safe and efficient operations and support its global strategy,” Seadrill said in a statement. Since acquiring Smedvig ASA in 2006, Seadrill has operated its management service company, Seadrill Management AS out of Stavanger, Norway. Globally, the company has established regional operational center with more than 400 people employed in Houston, Rio, Singapore, and Dubai.
In June, North Atlantic Drilling Ltd. was separated from Seadrill management to create an operational center for the North Atlantic, managed out of Stavanger.
The board said in its statement that as a direct consequence of these changes, it had reviewed the future management structure, with two areas of consideration resulting.
Firstly, the company can further improve its efficiency by reducing the size of Seadrill management and by moving several of its functions to the operating regions. Secondly, Seadrill management’s location in Stavanger could constrain its aggressive growth plans, for which access to qualified personnel is critical.
Furthermore, added the statement, “the Norwegian cost level and distance from Seadrill’s core markets makes travel and logistics cumbersome when managing worldwide operations.”
The board said it had decided to explore establishing a new management service function in an alternative location, with several locations including London, Dubai, Singapore, and Houston under consideration. A final decision is expected before the end of the year.
Seadrill’s management team is supportive and has agreed to relocate, if necessary, it added.
The company added that with North Atlantic Drilling now seeking a US listing, it is looking to further develop the organization in line with its strategy. North Atlantic Drilling would remain “a core part of Seadrill,” it added, continuing to focus on harsh environment operations from Stavanger.
It continued: “Our decision to consider moving Seadrill’s central management function should be seen as a dynamic decision to adapt to a changing market. In total four of our largest competitors have, in the last five years, taken similar decisions. The ultimate target is to secure access to the most skilled workforce, support our regional operations effectively, provide our customers with a first class service and ensure the company remains cost competitive.”
