Seadrill Limited is negotiating an 18-month extension for its West Aquarius deepwater harsh environment semisubmersible rig offshore Canada which would stretch its stay there until April 2017.

The rig is planned to work off the east coast of Canada, with the new contract – subject to required approvals by the joint interest owners – expected to be executed by 30 November, 2013. The total revenue potential for the extension is estimated to be approximately US $337 million.

Seadrill said the potential extension is related to its subsidiary Seadrill Partners, which as part of a settlement agreement has agreed to non-payment for 37 days during a recent mobilisation period as a result of the time required for the West Aquarius to complete modifications and repairs. This was in order to meet the regulatory requirements for operations in Canadian waters, and for the operator to receive authorisation from the Canadian authorities to start operations. This loss will negatively impact third quarter results.