Keppel FELS to Build Jackup for Gulf Drilling

Keppel FELS has secured a contract to build a KFELS B Class jackup valued at US$110 million for Gulf Drilling International Limited (GDI), Qatar's first national drilling company.

The jackup, GULF-4, well suited in the Persian Gulf and Indian waters, will be built to Keppel FELS' proprietary design. It will be capable of operating in 300 feet water depth, drilling down to 30,000 feet and accommodating 110 men.

Mr. Abduljabbar Saifaldeen, Managing Director of GDI, said, "It is very important for us to work with the right yard to build GDI's first ever jackup.

"Keppel FELS comes with strong credentials both with its successful newbuilding track record, and its B Class jackup rig design which has been tried and tested in the market. Keppel FELS has also provided GDI with a competitive bid among several internationally reputed bidders."

To date, all four KFELS B Class jackups have been gainfully deployed in different parts of the world, with six more currently under construction at Keppel FELS.

GULF-4, when delivered in the fourth quarter of 2006, will add to Keppel's track record of 11 KFELS B Class in the market since its introduction in year 2000.

Mr. Tong Chong Heong, Managing Director and Chief Operating Officer of Keppel Offshore & Marine (Keppel O&M), said, "This new contract is significant as it further establishes Keppel Offshore & Marine's footprint in the Persian Gulf."

The Persian Gulf is one of the most strategic waterways in the world due to its importance in world oil transportation. It contains 715 billion barrels of proven oil reserves, representing over 57% of the world's oil reserves, and 45% of the world's total natural gas reserves at 2,462 Tcf.

Keppel O&M has built a good track record in the Gulf. Among its work-in-progress are the construction by Keppel FELS of a jackup rig, Al Hail, for Abu Dhabi's National Drilling Company (NDC), and the upgrading and refurbishment by associate Arab Heavy Industries P.J.S.C. (AHI) of two jackups, GULF-2 and NPCC SEP-350 for GDI and National Petroleum Construction Company respectively.

Keppel FELS is the world leader in the design and construction of jackup rigs, having built 60% of the world's fleet on order in the last decade. It is a wholly-owned subsidiary of Singapore-listed Keppel Corporation Limited through Keppel O&M.

Keppel O&M is a global leader in offshore rigs and ship conversion and repair as well as a specialized shipbuilder. Its near market, near customer strategy is boosted by a global network of 16 yards in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions. Integrating the experience and expertise of its yards worldwide, the group aims to be a provider of choice and a partner in solutions for the offshore and marine industry.

GDI is a 60/40 joint venture established in May 2004 by Qatar Petroleum and Japan Drilling Company. The Doha-based JV is acquiring used and newbuild rigs to meet the escalating demands for drilling rigs in Qatar and region.

The contract is not expected to have material impact on the net tangible assets and earnings per share of Keppel Corporation for the financial year 2005.
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