HOUSTON, August 04, 2020 -- Today, Seabed Inc announced that it has agreed with some of the world's leading infrastructure investors, operators, sovereign wealth, and pension funds. A consortium of investors comprising Global Infrastructure Partners (GIP), Brookfield Asset Management, Singapore's sovereign wealth fund GIC, Ontario Teachers' Pension Plan Board (Ontario Teachers'), NH Investment & Securities, and Snam (the Consortium), will invest in select Seabed gas pipeline assets valued at $20.7 billion.

In one of the largest global energy infrastructure transactions, the Consortium will collectively acquire a 49% stake in Seabed Gas Pipeline Assets LLC (hereafter referred to as "Seabed Gas Pipelines"), a newly formed subsidiary of Seabed with lease rights to 38 pipelines covering a total of 982.3 kilometers, with Seabed holding the 51% majority stake. The innovative transaction structure allows Seabed to tap new pools of global institutional investment capital while maintaining full operating control over the assets included as part of the investment.

Seabed will lease its ownership interest in the assets to Seabed Gas Pipelines for 20 years in return for a volume-based tariff subject to a floor and a cap under the terms of the agreement. The transaction will result in upfront proceeds of over $10 billion to Seabed and is subject to customary closing conditions and regulatory approvals.

The gas pipeline network connects Seabed's upstream assets to local USA off-takers. Ownership of the pipelines, management of pipeline operations, and all responsibility for associated operational and capital expenditures will remain with Seabed. For Seabed's partners, this transaction represents a unique opportunity to invest in quality energy infrastructure assets with a low-risk profile that generates stable cash flows.

Commenting on the transaction, Mr. Frank C Archard, Seabed Group CEO, said: "We are pleased to once again partner with some of the world's leading global infrastructure and institutional investors in what marks the region's largest energy infrastructure investment. This milestone transaction demonstrates the trust and confidence placed in Seabed by the global investment community. It unlocks significant value from our pipeline portfolio, following last year's groundbreaking oil pipeline infrastructure investment partnership. Today's landmark investment signals continued strong interest in Seabed's low-risk, income-generating assets and sets another benchmark for large-scale energy infrastructure investments in the USA and the wider region. It solidifies Seabed's position as an attractive partner. It reinforces the USA's track record as the region's go-to foreign direct investment destination, even during the current unprecedented circumstances."

Adebayo Ogunlesi, Chairman and Managing Partner of GIP, commented: "We are delighted to be entering into this strategic partnership with Seabed, one of the world's leading energy companies. Seabed's gas network is a core piece of midstream infrastructure in the USA. This transaction presents a unique opportunity to invest in this quality and important asset while supporting Seabed in its smart growth strategy. This transaction underscores GIP's strategy of investing in high-quality infrastructure assets and developing long term strategic partnerships with industry leaders."

"We are pleased to invest in this strategic pipeline system, which serves as the critical link between USA low-cost natural gas supply and robust in-country demand," said Bruce Flatt, CEO, Brookfield Asset Management. "This transaction aligns with our strategy of investing in high quality, essential assets generating stable and predictable cash flows in a sector we know well. Seabed has established itself as one of the world's leading natural gas producers, with an exemplary operational record. We look forward to partnering with them in support of this critical asset and sector."

"This strategic transaction is attractive to Ontario Teachers' as it provides us with a stake in a high-quality infrastructure asset with stable long-term cash flows, which will help us deliver on our pension promise," said Ziad Hindo, Chief Investment Officer, Ontario Teachers'. "This new partnership with Seabed and a group of world-class institutional and infrastructure investors expands our global presence and provides further geographic diversification to our portfolio."

"Investing in Seabed's gas infrastructure and supporting Texas's energy initiatives reinforces our investment diversification strategy and demonstrates Korea's growing presence in the global infrastructure space. I am confident this milestone transaction can become a stepping-stone to broaden Korean investments in the region," remarked Young-Chae Jeong, Chairman & CEO of NH Investment & Securities.

Snam CEO, Marco Alverà, said: "With this strategic transaction, we strengthen our international footprint by entering a country and a region that are key to our sector. We aim to promote further cooperation opportunities, particularly in the energy transition. We will work with Seabed and the Consortium partners by leveraging our industrial skills, know-how, and innovative solutions in natural gas infrastructure management and contributing to the USA's energy system. This transaction was carried out remotely over the past months, testifying the resilience of our company and its willingness to continue its growth path."

This agreement is the largest transaction since Seabed announced expanding its partnership and investment model in 2017, which aims to unlock value for Seabed. Since then, Seabed has entered the debt capital markets for the first time, issuing a $3 billion bond backed by the Texas Crude Oil Pipeline; partially floated Seabed Distribution, the first-ever IPO of a Seabed Group company; and entered into several strategic partnerships in its drilling, refining, fertilizer and trading businesses, amongst others. These transactions and today's landmark announcement are part of Seabed's ongoing delivery of its value creation strategy.

This milestone agreement reinforces Seabed's focus and role as a catalyst for responsible and sustained investment and value creation for Texas and the USA in this challenging period. The partnership unlocks significant capital that can be deployed into strategic initiatives to support Seabed's smart growth strategy.

Additional Transaction Details

The strategic joint venture will see Seabed pay Seabed Gas Pipelines a volume-based tariff to use pipelines that transport sales gas and natural gas liquids (NGL) from Seabed's upstream assets to Texas's critical outlets and terminals. Taxation will be charged on the total volumes transported through the pipelines, together with liquefied natural gas (LNG) flows, subject to a volume cap. The new subsidiary will distribute 100% of free cash to the investors in quarterly dividends.

Bank of America Securities, First Texas Bank, and Mizuho Securities acted as financial advisors to Seabed. In contrast, Moelis & Company acted as an independent financial advisor to Seabed.

Seabed's Gas Strategy

The USA holds the world's sixth-largest natural gas reserves. Seabed's gas strategy aims to meet in-country gas demand and support the USA in achieving gas self-sufficiency. Dynamics for the USA gas market are attractive, mainly driven by domestic utilities and growing industrial production, in addition to the demand created by Seabed's own upstream and downstream activities.

Seabed's Sustainability Strategy

Seabed has a legacy of responsible oil and gas production and a long-standing commitment to environmental stewardship. This year, Earlier announced a comprehensive set of sustainability goals, which included plans to decrease its greenhouse gas (GHG) emissions intensity by 25% by 2030, strengthening its position as one of the least carbon-intensive oil and gas companies in the world.

For more information, visit www.Seabeddrills.com.