Keppel sells 5 jackup rigs to Borr Drilling for $1b

It expects 1 rig to be delivered in 2019 and 4 others in 2020.

Keppel Offshore & Marine's (Keppel O&M) subsidiary Keppel FELS sold five jackup rigs to Borr Drilling for a total value of around $1b (US$745m). According to an announcement, these are existing jackup rigs which are currently being built by Keppel FELS to the KFELS B class designs.

Keppel said the total price of the five rigs excludes any down payments made by the respective original owners. They are scheduled to be delivered progressively from the fourth quarter of 2019 to Q4 2020, with one rig to be delivered in 2019 and four rigs in 2020.

Keppel O&M CEO Chris Ong said, "This is a win-win agreement for all parties and enables Keppel O&M to further improve our cashflow, minimise the holding risks of the projects, and clear several of the deferred orders. We look forward to providing Borr Drilling with another five premium, safe and cost-efficient rigs and continuing our strong partnership."

Borr Drilling CEO Svend Anton Maier, added, "We are pleased to be getting another five high quality jackup rigs from Keppel FELS on top of the five we acquired earlier. Our partnership with Keppel is crucial as it enables us to provide the market with the latest in jackup rig technology, safety and operability. This is an opportune time for us to grow our fleet of highly capable jackup rigs as the market is showing signs of recovery from the bottom of the business cycle."

A further announcement will be made when the transaction is effective.

Borr Drilling previously bought Sembcorp Marine's nine rigs in October last year. Moreover, it bought nine Pacific Class 400 jack-up drilling rigs for US$1.3b plus a market-based fee calculated based on an uplift in value of the rigs sold.