North Atlantic Drilling Ltd., the rig-owner controlled by billionaire John Fredriksen, will hand OAO Rosneft a stake valued at more than $1 billion in return for land rigs and cash, deepening ties amid sanctions on Russia.

North Atlantic will issue Rosneft about 100 million new shares at $9.25 apiece, giving Russia’s biggest oil company about a 30% stake, said Rune Magnus Lundetrae, chief financial officer of Seadrill Ltd., which owns 70% of North Atlantic. At Thursday’s closing price of $10.3, the stake would be valued at more than $1 billion.

North Atlantic will in return get about 150 rigs, which is a “significant portion” of Rosneft’s land drilling fleet, as well as a cash balance, the Hamilton, Bermuda-based company said in a statement.

The transaction is the second step of a frame agreement signed in May and shows Fredriksen is undeterred by escalating U.S. and European Union sanctions against Russia over its role in Ukraine. North Atlantic and Rosneft last month completed the lease of offshore rigs in a deal worth $4.25 billion just days before tighter restrictions were imposed by the EU.

“We’re not very worried” that sanctions will affect any part of the deals, Lundetrae said by phone. “Rosneft is a very good and constructive partner for us.”

Seadrill fell 0.7% to 227.5 kroner by 2:54 p.m. in Oslo Friday and Rosneft sank 1.8% to 228.82 rubles in Moscow.

While companies such as ExxonMobil Corp. and Statoil ASA have continued offshore Arctic drilling alongside Rosneft even after sanctions were tightened, others have scaled back their involvement with Russia. Vitol Group put a plan to raise a $2 billion loan for Rosneft on hold because of U.S. restrictions on funding, according to people familiar with the matter.

Lundetrae declined to comment on the size of the cash balance in the transaction. Assuming each of Rosneft’s rigs are valued at $5 million, the balance would be about $200 million, said analyst Anders Bergland of RS Platou Markets AS.

“If they didn’t have the $200 million, the deal would probably not have been signed,” he said by phone. “It’s not on that scale that they would have problems” with funding.

EU sanctions bar companies from transferring technology for Arctic, deep-water or shale oil exploration and production in Russia. Since North Atlantic is purchasing rigs from Rosneft and not the other way around, it’s unlikely sanctions would affect that deal, Bergland said.

Seadrill will keep more than 50 percent after the deal, which is planned to close in the fourth quarter.

“We’re very pleased with the execution of this important transaction and welcome Rosneft as an equity partner and to our board of directors,” Alf Ragnar Lovdal, chief executive officer of North Atlantic, said in the statement.

Rosneft could raise its stake in North Atlantic further, it said in a separate statement. It could hold 50% over time, people familiar with the matter said in May.

Russia’s biggest oil producer last month signed long-term drilling contracts for six North Atlantic offshore rigs through 2022 for various projects including harsh-environment locations. One of those rigs, the West Alpha, is currently drilling a $700 million well in the Kara Sea for Exxon and Rosneft.

Rosneft under Friday’s deal also awarded a five-year contract for the onshore rigs acquired by North Atlantic. The Russian company’s press service declined to provide additional comments.