Keppel Divests Stake in Ultra Deepwater Tender Rig
Keppel FELS Limited, a wholly-owned subsidiary of Keppel Offshore & Marine Ltd, will divest its entire 72% interest in the rig, West Berani, to SeaDrill Asia Limited for approximately US$72 million.
This divestment follows the completion of the semisubmersible drilling tender (SSDT), which was delivered on time today.
In May 2005, Keppel FELS entered into an agreement with SeaDrill Asia, formerly Smedvig Asia, to own and operate the SSDT on a 72/28 basis respectively. SeaDrill Asia had the option to exercise Keppel FELS' interest in the rig upon completion.
This is the fifth deepwater tender drilling rig that Keppel has built for SeaDrill Asia since 1994. The first of the series, West Pelaut, was the world's primary purpose-built SSDT for tender-assisted drilling.
West Pelaut has been voted the Shell Platform Rig of the year out of a fleet of 13 platform rigs working for Shell. The key performance indicators were records for safety, successful operational performance and consistent long term performance.
Drawing from the initial design of West Pelaut, three more state-of-the-art SSDTs, West Menang, West Alliance and West Setia, each with increased variable deckloads, were subsequently built prior to West Berani.
Developed by the Deepwater Technology Group (DTG), a R&D arm of Keppel O&M, under the KFELS SSDT design, this series of tender rigs has been operating successfully in Asia Pacific and West Africa.
Conventionally, drilling tenders are only deployable next to fixed platforms. The KFELS SSDT series has been enhanced to provide drilling contractors and operators the flexibility to operate in deepwaters alongside Spars and Tension Leg Platforms (TLP).
A typical SSDT carries a Drilling Equipment Set (DES) and has high capacity cranes of up to 200 tonnes to deploy this DES onto the platforms within 12 hours. It also provides storage and accommodation facilities up to 140 men.
West Berani has been contracted by the consortium of Esso Production Malaysia Inc (EPMI), Newfield Malaysia and Nippon Oil, for a period of two years. It will be deployed off Kuantan, in East Malaysia.
The rig was named by Mrs. Cory Robinson, Lady Sponsor and wife of Mr. Kevin Robinson, Country Manager of Newfield Malaysia and Guest-of-Honor, on December 9, 2006.
Addressing everyone at the ceremony, Mr. Robinson said, "This is the first naming ceremony for many of us at Newfield and is indeed very memorable. We are pleased that West Berani is delivered on-time despite current market conditions so that she can be deployed as planned.
"Our fields in Malaysia may have shallow wells but they are not easy and certainly need a good rig to do this job."
Attributing the success of the project to the good relations SeaDrill and Keppel shares, Mr. Kjell Jacobsen, CEO, SeaDrill Management said, "Although the level of activity in the yard is the highest ever, it is with pride that we are able to bring a new rig to the market as planned, within budget, to the agreed quality and with the highest safety standards.
"Things are generally easier with the people you know, and people you have learnt to trust. Trust and confidence is something that we only can earn and build over time and that is the case between Keppel and SeaDrill.
Keppel O&M, a wholly-owned subsidiary of Keppel Corporation Limited, is the global leader in offshore rigs, ship repair and conversion and specialized shipbuilding. Keppel O&M's "near market, near customer" strategy is bolstered by a global network of 17 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 the provider of choice and partner in solutions for the offshore and marine industry.
SeaDrill Asia is a wholly-owned subsidiary of SeaDrill Limited, which has a diversified and modern fleet of nine jackups, seven semisubmersibles drilling rigs, three ultra-deep water drillships, two Floating Production Storage and Offloading (FPSO) vessels and 13 tender rigs, totaling 34 units. The company provides extensive platform drilling and well intervention services as well as engineering services by its pool of 200 skilled engineers. It operates in 12 countries on three continents.
Keppel FELS is currently building three KFELS B Class jackup rigs for SeaDrill Limited. It has earlier delivered one KFELS B jackup which is gainfully deployed in West Africa.
The divestment is not expected to have a material impact on the net tangible assets and earnings per share of Keppel Corporation for the financial year 2006.
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