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Sunday, 23 January 2011

Keppel to build two jackups for Clearwater worth US$360 million

Keppel FELS Limited (Keppel FELS) has secured new orders from Clearwater Capital Partners, LLC (Clearwater) to build a pair of premium KFELS B Class jackup rigs at US$360 million.

The two high specification jackups are scheduled for delivery in 1Q 2013 and 2Q 2013 respectively.

As part of the agreement, Clearwater has options to build another two similar jackup units with Keppel FELS. If exercised, the options for the additional two rigs will bring the total contract value to above US$730 million.

Mr Rob Petty, Managing Partner and Co-Founder of Clearwater, said, "Confidence is rapidly returning to the offshore industry and we expect a fundamental recovery of the sector. There is a clear bifurcation in the jackup market with oil companies increasingly focused on new, high specification rigs for their projects. We have followed this market closely and chose Keppel FELS as our long term partner to help us execute our investment plans in the transition of the jackup market from old rigs to safer, more efficient rigs.

"Keppel FELS is the gold standard for quality, engineering, and building execution in terms of both time and budgets. Our wide ranging due diligence before placing these substantial orders consistently validated the Keppel team to be professional - from the initial discussions through the engineering design and contract placement. We look forward to this same degree of professionalism and precision all the way through to delivery."

Mr Wong Kok Seng, Managing Director of Keppel FELS, said, "We thank Clearwater for their confidence in Keppel FELS and look forward to nurture a win-win partnership with them.

"The KFELS B Class design is the industry standard for efficient and high grade performance; to date, 33 such units have been delivered for operations in various parts of the world. I am confident that when completed, the KFELS B Class jackups will provide outstanding value and returns on Clearwater's investment."

The KFELS B Class jackup design is developed by Keppel's technology arm, Offshore Technology Development. When completed, Clearwater's rigs will be able to operate in water depths of 400 feet, drilling depth of 30,000 feet and accommodate 150 men.

The new contracts with Clearwater are not expected to have material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Status update on Keppel’s drillship contract with Noble

Singapore, 22 January 2011 – Keppel Offshore & Marine Ltd’s (“Keppel O&M”) wholly owned subsidiary, Keppel FELS Brasil, and Noble Corporation (Noble) have agreed to terminate the contract of an upgrade to the drillship Noble Muravlenko, that was scheduled to take place in 2013, on mutually acceptable terms.

Keppel FELS Brasil will receive a full recovery of expenses and committed costs, as well as a reasonable termination fee.

Mr Chow Yew Yuen, President, Keppel O&M (Americas), said, “We respect Noble’s decision and our partnership with them remains steadfast. We have been compensated for the cancellation and still have two drillship projects with Noble which also intends to award more projects to Keppel. Our yard capacity for 2013 will now allow us to take on more jobs in an improving market.”

The project was contracted with Noble in December 2009 at US$152 million.

The above contract termination is not expected to have any material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

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