The Export-Import Bank of Korea (www.koreaexim.go.kr, “Korea Eximbank”) announced on March 4 that the Bank will provide USD 400 million in ship financing (a USD 220 million Direct Loan* and a USD 180 million Comprehensive Guarantee**) to UK offshore deepwater drilling company Seadrill, which had awarded orders for three drillships worth USD 1.6 billion to Samsung Heavy Industries.

* Direct Loan: long-term loan provided by Korea Eximbank to foreign buyers to finance their purchase of Korean products.
** Comprehensive Guarantee: financial instrument designed to get commercial banks to participate in lending to a foreign ship buyer by guaranteeing the buyer’s repayment.

USD 180 million of the financing package will be offered in the form of Comprehensive Guarantee, which will guarantee the loans made to Seadrill by Korea Exchange Bank and HSBC, a domestic and an international commercial bank, respectively.

Seadrill is owned by Norwegian shipping magnate John Fredriksen, and is ranked No.1 in the global offshore drilling industry in terms of market capitalization.
The financing to be provided by Korea Eximbank is the first to materialize as a result of the bank’s MOU with Seadrill signed November last year, which promised USD 1 billion in financing for Seadrill's purchases of Korean drilling platforms.

Cooperation among domestic and foreign ECAs also played a conspicuous role in the financing of the USD 1.5 billion drillship export contract.

Apart from Korea Eximbank, K-Sure provided USD 400 million in export insurance, while the Norwegian Guarantee Institute for Export Credits (GIEK) provided USD 400 million in export guarantee.