Monday, January 24, 2011

Keppel FELS wins rig contracts worth US$360m

KEPPEL FELS has clinched new orders from New York-based Clearwater Capital Partners, LLC to build a pair of premium KFELS B Class jackup rigs at US$360 million.

Clearwater has options to order another two similar jackup units from Keppel FELS which if exercised will take the total contract value to above US$730 million.

The initial two high- specification jackups are scheduled for delivery in the first and second quarters respectively of 2013.

To date, Keppel FELS - a fully owned subsidiary of Keppel Offshore & Marine (Keppel O&M), which in turn is a wholly owned unit of Keppel Corporation - has delivered 33 KFELS B Class jackup rigs for operations in various parts of the world, said Keppel FELS managing director Wong Kok Seng.

The KFELS B Class jackup design is developed by Keppel O&M'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 per rig.

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

Clearwater is an investment firm set up in December 2001 and dedicated to investing in special situations across Asia excluding Japan.

Since its inception, Clearwater has invested over $2.5 billion in the Asia region and currently manages more than $2 billion in assets across four investment vehicles. It has a 17- person team in Singapore.

The company's managing partner and co-founder Rob Petty 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 . . . 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.'

Mr Petty referred to Keppel FELS as 'the gold standard for quality, engineering, and building execution in terms of both time and budgets'.

Over the weekend, Keppel Corp also said that Keppel FELS Brasil and Noble Corporation have agreed to terminate their contract of an upgrade to the drillship Noble Muravlenko, which was slated to take place in 2013, on mutually acceptable terms.

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

'Keppel FELS Brasil will receive a full recovery of expenses and committed costs, as well as a reasonable termination fee,' Keppel said in a filing with Singapore Exchange on Saturday.

Keppel O&M (Americas) president Chow Yew Yuen said: 'We . . . 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.'

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