Borrowings

The movement in bank interest bearing borrowings is as follows:

The Company has no ’off-balance sheet’ financing through special purpose entities. All long-term debt is included in the consolidated statement of financial position.

The increase in the total borrowings of US$1,379 million relates mainly to drawdowns on project finance facilities for Liza Destiny (FPSO), Liza Unity (FPSO), and the bridge loan facility for FPSO Sepetiba. The latter has been extended to July 12, 2021.

Further disclosures about the fair value measurement are included in note 4.3.29 Financial Instruments − Fair Values and Risk Management.

The borrowings, excluding transaction costs and amortized costs amounting to US$69 million (2019: US$81 million), have the following forecast repayment schedule:

The increase of the ’Total Current portion of Borrowings and lease liabilities’ balance is mainly explained by the Sepetiba Bridge loan facility for US$600 million.

The borrowings by entity are as follows:

Loans and borrowings per entity

• ¹ % interest per annum on the remaining loan balance.
• ² The Liza Unity Project finance facility maturity date is December 31, 2021 but can be extended in various ways, and up to the expiry date of the 2 years Charter Term provided that the vessel has been completed.

The Company acquired the remaining 75% equity ownership in OS Installer Limited on September 30, 2020. As a result, OS Installer Limited has been fully consolidated as from the acquisition date including the US$67 million loan borne by this subsidiary.

For the project finance facilities, the respective vessels are mortgaged to the banks or to note holders.

The Company has available borrowing facilities being the (i) undrawn revolving credit facility (RCF), (ii) the undrawn portions of Liza Unity (FPSO) project facilities and (iii) short-term credit lines.

Expiry date of the undrawn facilities and unused credit lines

The drawdowns in 2020 under the Liza Destiny and Liza Unity project finance facility lead to the decrease of available undrawn facilities and unusued credit lines.

The RCF in place as of December 31, 2020 has a maturity date of February 13, 2025, following the exercise of a one-year extension option on February 5, 2020. The US$1 billion facility was secured with a selected group of 11 core relationship banks and has an uncommitted option to increase the RCF by an additional US$500 million. On February 1, 2021, the lenders in the Company’s US$1 billion Revolving Credit Facility (RCF) agreed to the Company’s request to exercise the second one-year extension. The final maturity date of the RCF is thereby extended from February 12, 2025 to February 13, 2026. The Company does not have any other extension option remaining.

When needed, the RCF allows the Company to finance EPC activities / working capital, bridge any long-term financing needs, and/or finance general corporate purposes, when needed, in the following proportions:

• EPC activities / working capital – 100% of the facility;
• General Corporate Purposes – up to 50% of the facility;
• Refinancing project debt – 100% of the facility but limited to a period of 18 months

The pricing of the RCF is based on LIBOR and a margin adjusted in accordance with the applicable leverage ratio ranging from a minimum level of 0.50% p.a. to a maximum of 1.50% p.a. The margin also includes a Sustainability Adjustment Mechanism whereby the margin may increase or decrease by 0.05% based on the absolute change in the Company performance as measured and reported by Sustainalytics¹. The Company’s performance in 2020 allows the margin to remain stable for 2021.