Good day, and welcome to the Q4 2020 Transocean earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Lexington May, Manager of Investor Relations. Please go ahead, sir. Thank you, Sierra. Good morning, and welcome to Transocean's fourth quarter 2020 earnings conference call. A copy of our press release covering financial results, along with supporting statements and schedules, including reconciliations and disclosures regarding non-GAAP financial measures, are posted on our website at deepwater.com. Joining me on this morning's call are Jeremy Thigpen, President and Chief Executive Officer, Mark Mey, Executive Vice President and Chief Financial Officer, and Roddie Mackenzie, Senior Vice President of Marketing, Innovation, and Industry Relations. During the course of this call, Transocean management may make certain forward-looking statements regarding various matters related to our business and company that are not historical facts. Such statements are based upon the current expectations and certain assumptions and are, therefore, subject to certain risks and uncertainties. Many factors could cause actual results to differ materially. Please refer to our SEC filings for more information regarding our forward-looking statements, including the risks and uncertainties that could impact our future results. Also, please note that the company undertakes no duty to update or revise forward-looking statements. Following Jeremy and Mark's prepared comments, we will conduct a question and answer session. During this time, to give more participants an opportunity to speak on this call, please limit yourself to one initial question and one follow-up. Thank you very much. I will now turn the call over to Jeremy. Thank you, Lex, and welcome to our employees, customers, investors, and analysts participating in today's call. As we have for the better part of the past year, we continue to work following appropriate protocols to do our part to prevent the spread of COVID-19. As many of you know, in Texas, we've been battling record low temperatures, power and water outages, and are also experiencing intermittent connectivity and communications challenges. Therefore, please forgive us for any deterioration of the call's audio quality today. As reported in yesterday's earnings release, for the fourth quarter, Transocean delivered adjusted EBITDA of $210 million on $747 million in adjusted revenue. Importantly, this strong operating performance, which was driven by our experienced, committed, and unbelievably resilient teams, enabled us to generate $279 million in operating cash flow. Despite a number of challenges that we faced during the past year, including a global pandemic that presented new and unparalleled logistical and physical hurdles, we continued to deliver best-in-class, safe, reliable, and efficient operations for our customers. In fact, we delivered the best overall operational performance for any single year in the history of Transocean. In 2020, we delivered a total recordable incident rate of 0.24, the second lowest in the history of our company. Even more remarkably, we achieved this with no lost time incidents. We also delivered over 97% uptime across our global fleet, which marked a new best for Transocean. Importantly, we delivered this result with a fleet of floaters that are focused exclusively on ultra-deepwater and harsh environment operations, which present the most challenging operational conditions. Additionally, due to market conditions, our active fleet has decreased. Therefore, this makes each unplanned event even more significant to our business. Needless to say, our operations team delivered a great 2020, and for that, I would like to extend my deepest gratitude to our entire team at Transocean for the personal sacrifices made each and every day to deliver best-in-class service to our customers. Despite the COVID-19-related challenges we continue to face, the strength that our team continues to demonstrate throughout this pandemic is truly inspiring. In addition to the great effort delivered by our operations teams, I'd like to take a moment to recognize our shore-based support teams as well. Our HR and travel teams have moved heaven and earth to ensure that we have the right people on the right rig at the right time. Our supply chain teams overcame numerous obstacles to deliver equipment, parts, and services to properly maintain and operate our assets. Our finance and legal teams continue to demonstrate their creativity, skill, and efficiency as they identified and seized opportunities to extend our liquidity runway and reduce our material exposures. Our IT teams continue to ensure that we remain connected and efficient in a remote working environment. While the opportunities were scarce for much of 2020, our marketing team continued to work with our customers to create mutually beneficial solutions. Speaking of those solutions, I'm proud of the fact that we continue to align our interests with those of our customers by linking compensation from our customers to our operational performance, a practice that many of our competitors have rejected, but a practice that has resulted in an enhancement to our revenues. We believe the combination of our highly efficient performance and our ability to overcome challenges such as COVID-19 helps drive the efficient conversion of our approximately $7.8 billion backlog into revenue and ultimately into cash. Once again, well done to the entire team, and thank you for all that you continue to do for Transocean. Turning to the fleet. Starting in Norway, where we recently repositioned the Transocean Barents, we are pleased to report she has already secured a contract with MOL Norge. The campaign is set to kick off in the second quarter and is slated to run through the end of the year. This fixture is a direct result of the outstanding reputation that Transocean and the Barents have in Norway and further highlights the attractive market conditions resulting from the Norwegian government's favorable change in tax law to help spur investment in offshore exploration and production. Also in Norway, the Transocean Norge has just recently secured an additional extension with Equinor that will keep her busy until the summer. We are actively bidding her into several projects that would commence after the completion of her current campaign. This state-of-the-art rig has continued to garner customer interest and proven she can deliver. As such, her future remains very bright. In the U.K., Chrysaor extended the contract for the Paul B. Loyd, Jr., which will now continue working through the third quarter. Moving over to the Gulf of Mexico, I am pleased to announce Shell recently named the Deepwater Conqueror its floating rig of the year for its outstanding performance in the Gulf of Mexico. This is a testament to our operational excellence and best-in-class customer service. Staying in the Gulf of Mexico, I am happy to announce that just last week, BHP has exercised one of its options on the Deepwater Invictus at an increased day rate of $215,000 per day. The rig is expected to continue working through the summer. Finally, in the Gulf of Mexico, the Asgard recently completed a successful campaign for Beacon Offshore in January. The rig is now warm stacked, but as you all know, the Asgard is one of the most technically advanced and most well-respected assets in the U.S. Gulf of Mexico. As such, we are actively bidding her into multiple opportunities. Continuing our look around the fleet, now focusing in Trinidad, I'm pleased to report that the DDIII received a one-well extension from Shell and signed a new contract with BHP in Trinidad. These fixtures both carry attractive day rates ranging from $220,000-$250,000 a day. The work will keep her busy through August with an option that could further extend her activities into the fall. In Brazil during the fourth quarter, we announced that Petrobras exercised the 680-day option for the Deepwater Corcovado and the 815-day option for the Deepwater Mykonos. These extensions will keep these rigs working in Brazil through the summer of 2023 and added a total of nearly $300 million to our industry-leading backlog. Moving to West Africa, I'm pleased to report that Total has named the Deepwater Skyros as its rig of the year, due in large part to its superior performance and zero lost time record. Shifting over to India, I'm pleased to report that Reliance exercised its seven-well option on the KG1. This will keep her busy into the fourth quarter of 2022 and added more than $85 million in backlog. In the Asia-Pacific region, the KG2 recently commenced her contract with Woodside in Myanmar. Despite recent events in the area, the rig has continued to operate with the crew safely on board. Rest assured, we will continue to closely monitor the developments there with our crew's safety as our number one priority. Also during the quarter, the Deepwater Nautilus was under contract with our customer, Petronas in Malaysia, for a term that was expected to expire at the end of February. The customer attempted to terminate the remaining term early in November 2020. We strongly believe that this attempted early termination is invalid, and we are urgently pursuing all applicable remedies. Furthermore, I'm pleased to announce that just yesterday, we signed a new fixture for the Nautilus with POSCO. The rig will begin working at the end of March and continue into the summer. In addition to keeping our active fleet working, we remain diligent and continue to assess each asset's long-term marketability. As we have demonstrated repeatedly since early 2014, once we determine that a rig has limited profitable opportunities, we quickly remove her from our active fleet. Consistent with past practice and our disciplined philosophy on retirements of less competitive units, we decided to responsibly recycle the Leiv Eiriksson after completion of her successful campaign with ConocoPhillips in Norway. As we look toward upcoming opportunities, we're encouraged by the stability and steady improvement of oil prices since we last spoke. Today, Brent is trading above $60 per barrel and as a result of OPEC's production cuts, disciplined spending from U.S. shale producers, and demand slowly recovering as the COVID-19 vaccine is distributed around the world. Our customers are reacting to this upwardly biased stability and have started planning for new or previously delayed projects to commence later this year and going into next, in line with the timing of the expected global economic recovery. Taking a closer look around the U.S. Gulf of Mexico, activity is expected to increase with several projects starting in the second half of 2021 and early 2022, with contract awards expected in the coming weeks and months. Given their technical specifications and stellar reputations, we believe both the Asgard and Inspiration are well-placed to capitalize on these opportunities. In Brazil, Petrobras continues to make awards, adding long-term fixtures to the Três Marias project and recently launching several additional multi-year tenders that should book many, if not all, of the available rigs in Brazil. We expect the rig count in Brazil to sustain and steadily rise over the next couple of years based on Petrobras tender count matching pace with rigs coming off contract, coupled with demand from the IOCs incrementally adding to the pack. Encouraged by the signs we are seeing, we are optimistic that a handful of successful exploration wells in the pre-salt fields by the IOCs will signal a welcome return of activity in Brazil to levels that we haven't seen over the past few years. In Norway, we are excited about the opportunities unfolding as a result of the Norwegian government's recent enactment of favorable tax incentives for oil and gas projects sanctioned during the next two years. We anticipate this market will continue to tighten as more projects are brought forward to capitalize on the favorable investment incentives. As I previously mentioned, we've already started to see this come to fruition with the contracting of the Transocean Barents. Looking now at the U.K., we've witnessed a slight resurgence following what appeared to be a dearth of prospects. We are now encouraged by new tendering activity that has emerged, including the first multi-year tender we've seen since 2018. The lack of warm rigs available in the U.K. could actually see a pool of hot rigs from Norway to perform some of the work anticipated over the next year. In Africa, excluding Total's multi-year tender for Mozambique, which could be awarded in the coming months, we see several medium and long-term programs that could be awarded for Angola, including Exxon's 17-well tender and Total's multi-year tender. In the Asia-Pacific region, including Australia, we see several short and medium-term opportunities starting in the second half of this year. As you may know, this region has generated continued activity through these difficult times. The volume of opportunities is nearing pre-COVID-19 levels. In summary, we recognize the challenges brought on from a global pandemic, and that our expectations for a sustained recovery in offshore drilling will likely not materialize before mid-2021. We do expect the global floater count to continue to decline before stabilizing in the second half of the year. We are very encouraged by the improving macro environment and conversations with our customers for many opportunities emerging in the back half of 2021 and 2022. Following the initial disruptions caused by COVID-19, we have seized the opportunity to innovate, adapt, and deliver meaningful change across our organization. I believe that this is the direct result of our collective efforts each and every day to continuously improve Transocean, including through our investments in high-specification assets, the development and deployment of innovative technologies, and our investment in the continued development and training of our valued team members. As evidence of our dedication to innovation, we recently announced the successful deployment of our patented HaloGuard technology on the Deepwater Conqueror in the Gulf of Mexico. HaloGuard works through a combination of locating device technologies worn by personnel on the drill floor and a machine vision system using leading-edge techniques in machine learning and perception. As a crew member moves around the drill floor, the technology is able to not only locate, track, and alert the individual to equipment moving in his or her area, but also has the ability to halt moving equipment, further enhancing the safety of our crew members and overall operations. The ability for drilling equipment to identify and respond without human prompting is something we haven't seen before. We are pleased to provide our crews with additional tools and resources to complement our industry-leading training and safety programs. This technology adds an additional layer of protection for our crews, and we believe other industry participants and potentially other industries will also want to consider incorporating this technology into their operations going forward. We are currently planning to install this technology on six additional floaters this year. I'd now like to take a moment to discuss the state of offshore drilling. The majority of our peers have either formally started the restructuring process or have recently emerged. Transocean is in a very different and advantageous position relative to our competitors. Given our liquidity position and industry-leading backlog, we are not facing a restructuring decision. Candidly, we're pleased to see our competitors embracing the decision to restructure, as we anticipate that post-restructuring, we will experience a wave of fleet rationalization and industry consolidation as the new owners of these restructured companies move quickly to reduce cash costs, including costs associated with stacking and ultimately reactivating less capable assets, as well as the costs associated with maintaining multiple management teams. This will undoubtedly make it easier for our peers to rationalize their fleets and reduce the marketable supply of rigs. As consolidation unfolds, we believe that we will witness a more sustainable approach to contracting to benefit new and existing shareholders. When looking at the demand side of the equation, we see activity starting to pick up in the latter part of the year and heading into next. As the COVID-19 vaccines continue to be distributed and the global economy begins to recover from the pandemic, we believe demand for hydrocarbons will increase. This is setting up a potentially robust recovery for offshore drilling, with increasing demand and a dwindling and consolidating supply of assets converging at precisely the same time. If the market plays out the way we currently think it will, day rates could meaningfully increase as we move into 2022 and beyond. Our fleet of high-specification floaters is exceptionally well-positioned to capitalize on the recovery, ultimately providing us with opportunities to generate sufficient cash flow and meaningfully delever the balance sheet when opportunities arise. While we are increasingly encouraged by the market dynamics and take comfort in our approximately $7.8 billion backlog, we fully recognize that we have experienced a few major market-related head fakes over the past six years. As such, we remain very pragmatic and prudent in our operational and financial planning, recognizing the challenges to the industry and specifically those that Transocean will continue to face in the near term. I'd like to address some of the potential concerns regarding drilling activity in the U.S. Gulf of Mexico. As the leading deepwater drilling contractor in this region, we are paying close attention to any regulatory or legislative changes that could adversely impact the offshore drilling industry. I can report that our current drilling activity has not been impacted by the recent executive orders. We understand the Biden administration is taking time to review the current policies and regulations around permitting and leasing for federal lands and waters. We believe this is an effort by the Biden administration to impose more stringent regulatory requirements around hydrocarbon exploration and production on federal property as part of the administration's desire to reduce carbon emissions to fight climate change. However, we believe these actions may have two significant implications on the long-term macro environment. The first being that more stringent regulations will be placed on our customers that could ultimately cap U.S. production growth. The second is that it will lead to our customers looking elsewhere to explore and produce hydrocarbons, including the vast and prolific offshore basins around the world, such as Brazil, the North Sea, and West Africa, among other areas. It should be noted that one barrel of oil produced from the deepwater Gulf of Mexico has the lowest carbon intensity of all oil produced in the United States. We believe oil production in the Gulf of Mexico is an important part of the U.S. economy, as approximately 10% of the total U.S. oil production comes from the Gulf of Mexico, and of that, 90% comes from deepwater. We believe that we will continue to need oil from the Gulf of Mexico to help fulfill the world's energy needs. It's important to note that while we have heard from certain operators in the U.S. Gulf of Mexico who have received new permits for certain types of drilling activities following the initial announcements from the Biden administration, it is still too early to assess the full impact to Transocean regarding the actions that have been announced thus far. We will continue to be proactive in our approach to protecting our company and our shareholders. In conclusion, Transocean has strategically assembled the most competitive floating fleet in the industry, with the industry's most experienced crews and shore-based support team. We maintain the largest contracted fleet with the strongest backlog, providing us with the visibility to future cash flows that we need to continue to invest in the training of our crews and the maintenance of our assets. As such, we are best positioned to overcome challenges and benefit from the eventual market recovery. We think that we should observe more compelling evidence supporting a full-scale recovery in the deepwater market later this year. As oil prices have stabilized, it gives us confidence that our customers will be ready to increase their offshore activity in the years to come. In the interim, we are committed to our customers and to the preservation and generation of cash flows. We are proud to have positioned ourselves as the clear leader in harsh environment and ultra-deepwater drilling, and we'll continue to strategically refine our fleet to further enhance that position. As such, we expect that our marketed fleet will remain the industry's most utilized as we successfully navigate the current economic cycle. Mark? Thank you, Jeremy, and good day to all. During today's call, I will briefly recap our fourth quarter results and then provide guidance for the first quarter as well as expectations for the full year 2021. Lastly, I'll provide an update on our liquidity forecast through 2022. Before I begin, please note that we expect to file our Form 10-K later this week, which is a few days later than our typical filing cadence due to delays caused by the significant winter weather events of last week experienced by some of our team members who reside in Texas. As reported in our press release for the fourth quarter of 2020, we reported net loss attributable to controlling interest of $37 million, or $0.06 per diluted share. After adjustments associated with retirement of debt and discrete tax items, we report an adjusted net loss of $209 million, or $0.34 per diluted share. Further details are included in our press release. Highlights for the fourth quarter include adjusted EBITDA of $210 million, reflecting good revenue performance and cost control. In fact, our fleet-wide revenue efficiency exceeded 97%, showcasing our operational excellence, another quarter of stellar backlog conversion. Operating cash flow in the period was $277 million, improved from $82 million in the third quarter, largely due to reduced interest expense, improved collections of receivables, and lower personnel expenses, including severance expenses. Free cash flow generated in the fourth quarter was about $230 million, a significant quarter-over-quarter improvement of $215 million. Looking closer at our results, during the fourth quarter, we delivered contract drilling revenues of $747 million, above our guidance, due primarily to strong revenue efficiency as mentioned previously, as well as additional operating days on the Deepwater Asgard in December. Operating and maintenance expense in the fourth quarter was $465 million. This is above our guidance, primarily due to a non-cash provision for slow-moving obsolete inventory, the realization of performance bonuses associated with our OEM care agreements, and a lot of unexpected activity on the Deepwater Asgard. Turning to cash flow and balance sheet, we ended the fourth quarter with total liquidity of approximately $2.7 billion, including unrestricted cash and cash equivalents of approximately $1.1 billion, approximately $300 million of restricted cash for debt service, and $1.3 billion from our undrawn revolving credit facility. Furthermore, during the quarter, we opportunistically repurchased approximately $23 million of our debt in the open market at an average discount of approximately 11%, resulting in almost $3 million of interest savings to maturity. Let me now provide an update on our expectations for the first quarter and full year financial performance. For the first quarter of 2021, we expect adjusted contract revenue of approximately $680 million, based upon an average fleet-wide revenue efficiency of 95%. This reflects lower fleet-wide activity relative to the fourth quarter of 2020, in large part due to Deepwater Asgard and Leiv Eiriksson concluding their respective drilling campaigns during the quarter, coupled with the early termination notice on the Deepwater Nautilus. As Jeremy mentioned, we are currently disputing the validity of this termination notice. Additionally, we'll be retiring the Leiv Eiriksson as we concluded that the rig has limited commercial viability in the future. For the full year, we're anticipating adjusted revenue to be approximately $2.7 billion. We expect first quarter O&M expense to be approximately $445 million, a quarter-over-quarter decrease attributable to lower activity as a result of the previously mentioned rigs running of contract. For the full year, we're anticipating O&M expense to be approximately $1.6 billion. We expect G&A expense for the first quarter to be approximately $40 million and approximately $160 million for the full year. Net interest expense for the first quarter is forecasted to be approximately $110 million. This includes capitalized interest of approximately $12 million. For the full year, we anticipate net interest expense of $400 million, including capitalized interest of approximately $85 million. Capital expenditures, including capitalized interest for the first quarter, are forecast to be approximately $115 million. This includes approximately $100 million for our newbuild drill ships under construction and $15 million of maintenance CapEx. Cash taxes are expected to be approximately $5 million for the first quarter and approximately $25 million to $30 million for the year. Turning now to our projected liquidity at December 31, 2022. Including potential securitization or demobilization, our end-of-year 2022 liquidity is estimated to be between $1.2 billion and $1.4 billion. This liquidity forecast includes an estimated 2021 CapEx of $1.3 billion and 2022 CapEx expectation of $300 million. The 2021 CapEx includes $1.2 billion related to our new builds and $100 million for maintenance CapEx. As always, our guidance excludes any speculative rig reactivations or upgrades. In conclusion, in addition to safe and efficient operation of our rigs, we will continue to focus on optimizing cash flow through revenue enhancement and cost control initiatives. We will also continue to take steps to improve our balance sheet and liquidity. As we demonstrated in 2020 through a series of liability management transactions that included debt refinancing, private and public debt exchanges, debt tenders, and open market repurchases of our debt, we improved our overall liquidity through 2025 by approximately $1.7 billion. These transactions also resulted in a total interest expense to maturity savings of approximately $518 million. You should expect us to continue to take steps to delever our balance sheet and extend our liquidity runway using all appropriate tools available in the market. In this regard, you will note from our press release yesterday that we have entered into private exchange transactions that result in the maturity of approximately $253 million of our principal of our 2023 exchangeable bonds being effectively extended into a new priority guaranteed exchangeable bond due December 2025. Subsequent to the press release being issued, participation in one of the exchange transactions increased by $40 million, increasing the total principal participation of the 2023 exchangeable bonds to approximately $293 million. This will result in an aggregate principal amount of approximately $256 million of priority guaranteed exchangeable bonds due December 2025, being issued. After these exchange transactions close, the remaining principal balance on the 2023 exchangeable bonds will be approximately $117 million, reflecting a principal reduction of $693 million since the beginning of 2020. I will now turn it back over to Lex. Thanks, Mark. Sierra, we're now ready to take questions. As a reminder to the participants, please limit yourself to one initial question and one follow-up question. All right. If you would like to ask a question, you may signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that is star one to ask a question. We'll take the first question from Ian MacPherson with Simmons. Thanks. Good morning, Jeremy and Mark. Thanks for all the detail. Good morning. The main question for me is, it seems like we're plowing forward with the Deepwater Atlas CapEx program. It's been a while since we've gotten an update on where we are with contract negotiations. I think that cash burn, in the absence of contract news is one of the concerns here. Maybe you could update us there on the strategy and any sort of trigger points for full green light or maybe changing course with the CapEx. Yeah. Thanks, Ian. I'll start and then, Mark, if you want to chime in, Roddie, as well. Obviously, it's a big delivery for us and we're excited to take delivery of what will be one of the best assets, and we want it too. We have been in constant conversation, obviously, with Beacon Offshore, and their commitment has been unwavering. Their enthusiasm for the project has been unwavering. We are still awaiting FID, but they seem confident on their side, and we talk to them, if not every day, every other day. We're continuing to monitor that situation closely. Of course, on the backside of that, we are obviously engaged with discussions on the shipyard as well. Moving forward, at this point in time, trying to do everything we can to get Beacon to secure FID and then work with the shipyard for timely delivery. Mark, I don't know if you want to add anything to that. You might be muted. Oh, yeah. I'm sorry. Yes, just one thing, Jeremy. Ian, I think it's fair to say that if the Beacon FID does not occur, we will certainly engage with the shipyard to discuss options around whether we take the rig out now, whether we delay delivery as we have in the past several times, and obviously how we deal with the final payment on that rig as well. I think it all comes back to, as Jeremy indicated, the contract discussions with Beacon. Understood. Thanks for those comments. Regarding the shape of the market heading forward, I think you made a strong case that you've got a positive nexus coming with supply and demand over the next year or so. I think it's been argued also that the recapitalization of all, not all, but maybe the majority of your peers, is more of a competitive threat than a benefit. When you look at how undisciplined the bidding in the market had been before they were recapitalized, it's hard for me to imagine that the competitive dynamics don't get better as opposed to worse. How much do you think that that particular dynamic, the recapitalization of your peers, will influence bidding? Do you already see evidence of it now? Do you think that it will manifest itself over the coming quarters? I'll start, and then Roddie, you can chime in as well and offer even more color. We're actually looking forward to all of the restructuring and then seeing what happens afterward. Our sense is that the new owners, which are heavy participants in each of these restructured companies, will want to move quickly to conserve cash and find ways to generate cash. We actually think that there could be a wave, if you will, of rig retirements, rigs that should have been retired probably years ago, because they do consume cash just to stack them, and certainly consume a lot of cash once you go to reactivate them. They're assets that are of lower technical standard, and are probably less likely to be reactivated in the near term. I think we could see quite a few rigs retired post-restructuring. Also think that we could see quite a bit of consolidation. You look across the space, there is a lot of cash tied up in G&A for each of the management teams of these companies that are going through restructuring. If you're a large owner and probably have multiple board seats on these restructured companies, I think might move quickly to try to consolidate some of them. All of that, I think, certainly shrinks supply of available rigs, but it also brings more discipline, we think, going forward. We're actually more encouraged to see what happens post-restructuring. We don't see it as a disadvantage. They're going to want to generate cash, and they're going to want to know what the best market day rate they can get will be. We'll certainly set the standard on that. I think we could get into a much healthier industry structure, which could lead to a much healthier approach to bidding this work. Yeah anything you want to add to that? Sure. Yeah. I'd add in there, the activity levels that we're seeing and the intending, and in fact, the bid duration is basically doubling now. We see that there's a real opportunity here that the activity levels could return to the kind of 2016, maybe even 2015 levels. The big difference now is there's about 60 less rigs than there was in that timeframe. If you count the competitive rigs that are not cold stacked and mothballed, then you may be as much as 100 rigs different than you were in the market dynamics for floaters just four or five years ago. As Jeremy says, the announcements made by several of our competitors that they intend to scrap a lot of these assets because during the restructuring, they basically have removed the financial shackles on taking those steps. Some consolidation, I think it's very easy to see significantly fewer number of rigs available in the hands of fewer competitors. We would imagine that those bondholders are very keen to see a return on their investments eventually. Yep. All makes sense. Thanks, everyone. Thanks, Ian. Once again, that is star one to ask a question. If you find your question has been answered, you may remove yourself from the queue by pressing star two. The next question is from Connor Lynagh with Morgan Stanley. Yeah, thanks. I wanted to stay on the attrition theme here. One of the pushbacks that we hear on some of the retirements that are taking place is, in large part, maybe not entirely, but in large part, these are older rigs that maybe have been less competitive in the market for a few years now. I'm curious, if we rewind the clock to 2017, 2018, 2019, do you feel that the presence of some of these older rigs was still weighing on day rates or weighing on the bidding environment out there? I guess just sort of what's your take on whether or not the loss of some of these lower quality older rigs is going to impact the market? Yeah, I'll take that one. Sorry. Yep. Absolutely. I think we have to recognize that back in that timeframe, when those rigs were perhaps not long-term stacked at that point, they were being kept somewhat warm, somewhat active. Obviously, the desire to turn that into a contract is pretty strong. When faced with that decision, that's where a lot of that lack of discipline enters the marketplace. I think now, especially in this restructuring, you see some of those assets now being removed from debt covenants and those kind of things. Certainly moving forward, there's fewer and fewer ability or desire to keep those rigs warm. That's basically what you're seeing. Now we see quarter- on- quarter, the number of cold stacked rigs is going down because the equivalent number are actually being scrapped. If we look at scrapping in general, by our count, we're about 160 rigs have been scrapped since the beginning of the downturn in 2014. If you count the numbers, it's approaching half of the fleet. We think it will actually eclipse half the fleet at some point later this year. Scrapping or retiring, it really is the name of the game. I think over the past couple of years too- Sorry, go ahead. Yeah. Over the past couple of years too, the best assets have been the ones that have secured contracts. I think our customers have seen the efficiencies that can be driven from some of these higher spec, newer assets. At the end of the day, the day rate for them is not as meaningful if they can compress the time of their projects and get to first oil more quickly. I think they're starting to see that, and won't accept the lower spec assets going forward. Yeah, understood. I guess just the other side of that is the cold stacked assets, and I would think that the longer these sit, the higher cost it becomes and prohibitive it becomes to reactivate them. Can you help us think through, just in your experience, for an asset that's been stacked for a year or two versus some of the assets that are looking to come out maybe 2023, 2024, how different is the cost? Put differently, how different is the day rate that you would require to justify the reactivation of some of those assets? I don't know that we've, as an industry, experienced this before. You might have stacked one asset for a year or two and then brought it back out. To see some of these sit now for multiple years, I don't know that we fully understand what the process is going to be, what the cost is going to be. We obviously, as we properly preserve these assets, we put together a list of what we thought it was going to take to reactivate and put together a budget of what we thought it would cost to reactivate. I think your point's well made. I think this is steel sitting in water and electronics and saltwater. You've got to think that as more time passes, the more cumbersome the reactivation and probably the more expensive. Candidly, we just don't know yet. I think we've repeatedly said, depending on the asset and the length of time it's been stacked, you might see a reactivation anywhere from $25 million to well over $100 million. From our perspective, and hopefully our competitors' perspective, we're not willing to invest that capital into a reactivation unless we're getting rewarded for it with the contract that gives us return. Connor, Yeah. And just say that- Go ahead, sorry. You look at the balance sheet and the quality of our peers, they cannot afford to go ahead and spend. Jeremy started $25, I'm going to start at $50 million-$100 million plus on reactivating assets. It's just not possible. Sorry, Roddie. Yeah, that was my point really was that once upon a time, there was perhaps money in the coffers to do that, but certainly amongst the groups now, that would be a very bad use of the remaining capital that our competitors have. We imagine that that is not something they're going to want to do. Makes sense. Thanks for all the color. All right, the next question is from Taylor Zurcher with Tudor, Pickering, and Holt. Good morning, and thank you. I wanted to start by asking on the new regulatory environment in the Gulf of Mexico. I realize this question might be a bit premature, specific to the 20K psi opportunity set, most of that, if not all of that, is going to be in the Gulf of Mexico. I'm just curious if you could help us think about whether some of these regulatory changes might impact your thinking with respect to upgrading your two new builds with 20K psi capabilities. I'm thinking here in mainly the Atlas, which only has a letter of intent right now. Any thoughts there would be helpful. Thanks. Yeah, I'll pick up. Roddie, why don't you take them? Yeah. Yep. Sure. Look, on that side of things, the development plans that are in place for the 20K prospects for the likes of Anchor and Shenandoah, those are fields that have been previously sanctioned. They've got development plans that have been approved. Obviously, as they go through the process of getting the drilling permits, all of the technology is being qualified. They are following all the rules that are in the existing leases. All of these leases are current, which basically means they're in compliance. The administration has shown that they are honoring their previous commitments, which means that they are approving drilling permits that are filed in accordance with the rules and, of course, filed under a current license. We really don't see any challenges to that because the operators are doing exactly what they're supposed to do. As we see the Department of the Interior returning authorities to the local BOEM offices, we just don't see that being a particular hurdle. We're following all the rules. All of the precautions are taken as they should do. Again, these are just really the permits to allow development of these existing assets. From that point of view, we really don't see much risk at all there on the qualifications of the 20K equipment. All right. That's helpful. Thanks for that. My follow-up is as it relates to the Asgard and Inspiration, both of those assets are idle today. In the prepared remarks, it sounded like both of those have some good marketable opportunities within 2021, and it sounded like most of that was in the Gulf of Mexico. I'm just curious, are those rigs largely being bid for opportunities in the U.S. Gulf of Mexico? If there's any way you could provide some guidance or color on whether you think both of those rigs might be back working by, let's say, year-end 2021, that'd be super helpful. Sure. I'll pick that one up. What we're seeing in the Gulf of Mexico, it's very interesting when we compare it to what we saw as we exited 2019. You may or may not recall that supply became real tight. Essentially, the hot assets available just began to shrink. We were quite successful in getting the rates from the kind of the $170, $180 level up to the mid twos. We're actually seeing the same thing again. When we put our supply and demand chart together and we go into it in greater detail, because of the number of rigs that have since been retired or kind of mothballed, permanently cold stacked, the number of available rigs and the number of opportunities we see by the end of 2021 show that there's actually a couple of rigs short. That combined with the new well control rules on shearing and stuff like that, there's some long lead items required on shear rams and those kind of things. We're cautiously optimistic there that the Gulf of Mexico is going to see a pop in demand. We're already seeing it in the tenders. Once a few of these things get booked up, I think there's a very good possibility both those rigs will be working at the end of the year for sure. We got to take it from there, but it's looking like a balanced market exiting this year. That's a very positive development compared to where we were some six, nine months ago. Awesome. Thanks for the answers. All right, the next question is from Fredrik Stene with Clarksons Platou Securities. Hey, guys. Fredrik here, first, congratulations on the very strong operational quarter. My question- Thank you, Fredrik. ...mostly relates to what you've done on the financial side here, which I also think is impressive. You've kind of pulled every lever you have and been able to substantially reduce particularly the amount of unsecured debt that you have due now in the next few years. I was wondering, with only quite a minimal amount left now compared to what you have, do you have any other levers left that you can pull, for example, more senior guaranteed capacity? Or do you think that you would turn your efforts towards, for example, the Sentry bond and the secured bonds instead to try to get even more runway out of this? Fredrik, that's a good question, look, our philosophy has been, for the last several years, to try and maintain a liquidity runway of about five years. We look out over five years, and whether it's secured, unsecured, guaranteed, or convertible bonds, whatever's in that runway, we try and attack that as soon as we can and in any way which we can. Last year, we were sitting there in February, we had no idea we were going to get hit with COVID-19 a month later, which had a dramatic impact on our equity and debt pricing. That provided an opportunity for us to go and do some exchanges. As we look through the rest of this year, as opportunities arrive and arise, we will take advantage of that and continue to keep that runway as clear as possible. Perfect. Just as a follow-up to that, and again, I think this relates to actually the Equinor bonds, as I call them. At the moment, it seems like the market is definitely pricing in some expectations about a new contract or a contract or an option exercise or something like that for these rigs and with the new tax scheme in Norway as well starting to have an effect. Do you have any update on your discussions with Equinor, if you've had any, about the future of those rigs on the NCS? Roddie, you want to take that? Yeah, I'll take that one. Absolutely. Yes, we are in constant dialogue with our customers, and of course, Equinor being one of the biggest. We're exploring various different things that we could do with those rigs. They have been highly customized. We've recently gone through several really meaningful upgrades on the technology side for those rigs. Equinor's invested in these rigs. They're actually performing extremely well and actually reaping the benefits of those upgrades. We remain very optimistic that they will be an active part of the fleet, certainly because the demand seems to be there from Equinor, but also that they are amongst the top performers in the Equinor fleet. We're feeling pretty good about that. Thank you, guys. I'll get back in the queue. All right, the next question is from Mike Sabella with Bank of America. Hey. Good morning, everyone. I guess one of the things I was hoping to touch on, Jeremy, you mentioned earlier that the outlook for day rates is improving as we head towards 2022. Could you give us an idea of what improving means? Is it kind of 250-ish later this year and into next year, or is that still a little too optimistic as we sort of start the recovery? Yeah. I quoted in our prepared remarks, I think it was we had one ultra-deepwater drill ship that we signed up for $250,000. We had the semi-submersibles in Trinidad, the DD3, that was between $225,000-$250,000. It's moving in the right direction, and I think what I'd point back to is if you'll remember the close of 2019, when we were really starting to build some momentum. We signed about five fixtures, which we announced in January of 2020, and all were in that mid $200 range. I think they averaged around $250, maybe a little bit more. We were seeing more momentum building as we entered the year. Unfortunately, COVID hit and just sucked the wind out of our sails. I think you could probably see a similar trajectory where, as Roddie said, there is some enthusiasm and some market out there right now, Gulf of Mexico and elsewhere, where we could start to see the marketable supply of rigs get consumed pretty quickly. When that happens, you can push day rates pretty quickly. Roddie, I don't know if you want to add more color to that, but I think mid twos to high twos is not unrealistic if the market can continue to hold together. Yeah, I think certainly that's the case in 2022. I would concur with that. Certainly, I think this is the point is, you pay really close attention to those supply and demand charts, and you see the opportunity there. To be quite honest, our customers have spent the past several years tooling the business to be profitable at $40 or $50 a barrel, in some cases even lower. With the commodity prices in the 60s and a few folks predicting that they're going to be in the 70s by year-end, I think there's some still very good money to be made by the operators, even if we have a modest increase in the day rates associated with the floaters. Yeah, certainly mid twos to high twos, very possible in the next 12 to 18 months. Perfect. Thanks. I've probably beaten what's going on in the Gulf of Mexico to death at this point. As we think of Anchor and some of the other long-term contracts that are in place, if it gets bad in the Gulf of Mexico, are you hearing anything from Chevron that, is Anchor expected to still be on time relative to the previous schedule that was laid out and the other long-term contracts in the Gulf of Mexico? Is there any concern for any of those rigs if the administration takes this in a more austere direction than what people are expecting? Sorry, go ahead, Jeremy. Go ahead, Roddie. Go ahead. Okay. There's no accounting for an immediate left turn. Certainly that's not the case. What we've seen so far is actually an increased urgency from our customers to get on with it. In fact, if they could take the rigs earlier and start earlier, I think they would. I think the macro environment's so attractive just now that it's worth pushing them on. Certainly, we talk to them all the time about the technical details of where we are, but also the larger political environment. Certainly, the feedback we get from them is that the Administration is very keen to see improvements in ESG targets and those kind of things. They're not about trying to shut down the economic engine that the Gulf of Mexico is. I would just summarize by saying we have not seen any drawbacks to that yet. If anything, we've seen more urgency from the customers. We appreciate that, and obviously we look to service that as best we possibly can. Perfect. Thanks, everyone. All right, we'll take our final question from Sean Meakim with JPMorgan. Thank you. Good morning. Morning. As you see better prospects for tenders in 2022, can you maybe just talk at a high level about how you'll approach contract duration? In other words, if supply demand dynamics get more favorable as you expect, should we expect you to focus on shorter duration work to not lock in rates below where you see the markets headed? Maybe would you do a barbell approach where you try to lock in some longer-term Anchor contracts and then leave optionality for some others? Yeah, I think. Probably all of the above. Right. If you do the analysis on the fleet status report, you kind of see that, right? We have a few that are locked in longer term. We look at the assets specifically on which ones are super competitive or have special powers, as we like to think of, where they have features that perhaps are extremely rare in the industry. I would say we do all of the above. We do look to lock in a few, but certainly, we're not going to take our best assets and tag them up to day rates that don't create meaningful EBITDA. We will keep those short, even if we do have a little bit of idle time in between contracts. That's going to be worth it for the upside as we begin to see this thing improve. Yeah, a split strategy for sure, but certainly on the better assets, we're not keen to tie them up for long periods of time at low rates. No, it would be with a scaling year one at some day rate, year two at a higher day rate, year three at an even higher day rate if we were going to do anything like that. Right. That makes a lot of sense. Maybe one more for Mark, then, just to follow up on how you see your remaining financing options. Just in terms of clearing the liquidity runway, as you mentioned before, it's perhaps worth noting your stock's up 5x in the last four months. Does that change your set of options at all from that perspective? I think it enhances our options. Having one more potential tool out there. We could look at equity link. We could look at equity. Our primary driver has been, as you've seen in the past, exchanges, tenders, open market repurchases. We're going to look at all of that, and whatever makes the most economic sense for our shareholders, we're going to go after that. Got it. Very good. Thank you. All right, there are no further questions at this time. Lexington, I'd like to turn the call back to you for any additional or closing remarks. Thank you, Sierra, and thank you everyone for your participation on today's call. If you have further questions, please feel free to contact me. We look forward to talking with you again when we report our first quarter 2021 results. Have a good day. This concludes today's call. Thank you for your participation. You may now disconnect.