What's the 2012 battle plan for Keppel Corp?

CEO Choo Chiau Beng shares the conglomerate's strategies after a stellar 2011.

One of its main focuses this year will be on capturing a bigger pie of offshore drilling, Mr. Choo said after the release of the Keppel Corp's 2011 net profits, which grew 14% to S$1.481 billion yoy.

The CEO also sees its other divisions servicing the increasing demand of Asian mega cities for waste and water treament, logistics and warehousing, and office rental space.

"Let me now touch on the prospects for our businesses in 2012. In Offshore & Marine, we will focus on executing the orders that we have secured, maintaining our track record for on-time, on-budget deliveries and extracting maximum value from each project. Global demand for oil is projected to continue rising. Major oil companies have also announced increased budgets for exploration and production to address the decline in production capacity and replace depleting reserves. Dayrates have been strengthening for both jackups and semisubmersibles. With offshore drilling moving towards deeper waters, we are also seeing improving prospects for our deepwater solutions," Mr. Choo said.

"Over the past year, our new proprietary products have been gaining market acceptance. Our three KFELS N Class jackups, designed specifically for the harsh environment in the North Sea, have started working for their owner. Our first multi-purpose self-elevating platform has also secured a charter for wind farm foundation work in the North Sea. The accommodation semisubmersibles we delivered have also clinched long-term charters. Our KFELS Super A Class jackup for Ensco and a semisubmersible drilling tender for Seadrill, both ordered last year, have already been awarded charters. We are confident that with continued innovation, our proprietary designs will meet the evolving needs of the industry and believe that like the KFELS B Class jackup design, they will in time become the industry benchmark."

"In Asia, urbanisation continues unabated. Last year, China witnessed a milestone of having more of its population living in cities than in rural communities. Many cities elsewhere in Asia are also growing rapidly. Rapid urban growth has also sparked concerns and interest in tougher regulations for environment protection and in minimising carbon emission. This trend will create demand for environmental and urban solutions around the world, especially in Asia, presenting more opportunities for KIE to offer commercially viable solutions for waste and water treatment."

"Demand for logistics and warehousing services is expected to be sustained with Asia’s continued growth. Keppel T&T will capture value from its enhanced logistics network with its recent capacity expansion in China and Southeast Asia. With the strong growth in global cloud-computing needs, Keppel T&T is also looking to grow its data centre business in Singapore and abroad."

"Despite signs of moderation, Asia’s growth is expected to remain on a sustainable footing. Net office demand is likely to remain positive in 2012 with new entrants setting up businesses here in Singapore. As such, office rentals are expected to stay healthy. Keppel’s well-located office buildings have continued to command good rentals, with prospects of upward revisions for rental renewals. We will also continue to grow our property fund management business, scanning for good opportunities to enhance our portfolio of quality assets."

"We continue to believe in the fundamentals of demand from Asia’s growing middle class for homes and will continue to position ourselves to capture value. Keppel Land will continue to seek out good sites at attractive prices in our key markets of Singapore, China, Vietnam and Indonesia," he ended.