Keppel FELS secures $1.1b jackup rig order from Transocean

Delivery set between 2016 to 2017.

Keppel FELS Limited (Keppel FELS), a wholly-owned subsidiary of Keppel Offshore & Marine (Keppel O&M), announced that it has secured a repeat order from a subsidiary of Transocean Ltd. (Transocean) to build 5 KFELS Super B Class jackup rigs for US$1.1 billion.

The rigs are scheduled to be delivered progressively from 1Q 2016 to 3Q 2017. In addition, Transocean has options to build up to another five similar jackup rigs with Keppel FELS.

Mr Wong Kok Seng, Managing Director (Offshore) of Keppel O&M and Managing Director of Keppel FELS said, “We are glad that Transocean has chosen to expand their fleet of premium jackup rigs with the KFELS Super B Class design. It is a testament to our strong track record and the value-add that we offer to our customers.

“Having already delivered three jackup rigs to them earlier this year, on time, within budget and without incidents, we have assured them that we have the expertise and experience to deliver high quality rigs to their schedule and requirements.

“In this industry, any delay can be costly. We understand the importance of delivering quality rigs safely and on schedule as it affects our customer’s planning in deploying the rigs swiftly for a return on investment. This year, Keppel FELS has already delivered 17 rigs to the satisfaction of our customers and is on track to complete an unprecedented 20 or even 21 rigs by year-end.”

Mr Wong added, “Even with the stiff competition in the market, we are heartened that customers, whether new entrants or well-established ones like Transocean are choosing to build in Singapore and differentiating us for our proven rig designs, reputation for excellent project execution and having a competitive total project price.

“This year, Keppel O&M has already secured 20 newbuild projects worth about S$6.4 billion, including this latest order. All of them are based on our proprietary designs. We build winning partnerships with our customers, and our collaboration with Transocean over the years has enabled us to customise innovative products well suited to meet the market’s needs.”

Tailored to suit Transocean’s requirements, the KFELS Super B Class rigs are designed to operate in 400 feet water depth and drill to 35,000 feet. With a two million pound drilling system and a maximum combined cantilever load of 3,700 kips, the KFELS Super B Class is equipped with tremendous horsepower during drilling operations. In addition, the rig will be installed with offline stand building features in its drilling system package which allows drilling and the preparation of drill pipes to take place at the same time. The rig is capable of drilling at a 75 feet outreach, allowing for coverage of a larger well pattern.

Keppel FELS and Transocean have shared a long-standing relationship spanning several significant projects. The three jackup rigs recently delivered are Transocean Siam Driller, Transocean Andaman and Transocean Ao Thai. In 2009, Keppel delivered Transocean’s Development Driller III, an ultra-deepwater drilling semisubmersible rig built to Keppel’s proprietary DSSTM 51 semisubmersible design.

Other projects include upgrades and conversions of the Sedco 700-series semisubmersibles to enable dynamic positioning, and the repair of various Transocean rigs. Since 1987, Transocean, through Global Santa Fe, and Keppel O&M have cooperated and completed seven new generation jackups that are now part of Transocean’s fleet of highly sophisticated rigs.

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