Keppel Builds Accommodation Unit with JCE Group

Through a co-operation agreement, Keppel Offshore & Marine Limited and the JCE Group of Sweden have invested in a US$95 million semisubmersible accommodation platform in anticipation of expected strong demand for such offshore supporting units.

Based on Keppel O&M's proprietary design, the platform is being built by Keppel FELS Ltd and will be completed by early March 2005.

Under the agreement, a 85/15 percent Special Purpose Company (SPC) between Keppel O&M and JCE respectively will own the accommodation platform and Consafe Offshore AB, the wholly owned subsidiary of JCE, would be responsible for marketing, management and operation of the accommodation platform, which has been named Safe Concordia. Upon securing a qualifying charter as provided in the agreement, JCE will increase its shareholding in the SPC to 50 percent and the remaining 50 percent shareholding in the SPC that is owned by Keppel O&M is subject to call and put options by JCE and Keppel O&M, respectively excerciseable upon the occurrence of certain events and on agreed terms and conditions.

Upon completion in early March 2005, Safe Concordia is expected to operate in the deep waters of the East Timor Sea under a short bareboat charter.

Riding on the buoyancy of the offshore market, Keppel O&M has secured a total of US$453 million worth of contracts within the first two months of 2005. It has also divested its 75 percent share in the ENSCO 106 jackup rig to ENSCO Offshore prior to the delivery of the rig.

Designed by Keppel O&M's Deepwater Technology Group, this ultra-deepwater platform, the KFELS SSAU 3600-GOM-C42, is based on the highly successful hull forms of the drilling tenders, West Pelaut, West Menang and West Alliance, which are being deployed in deep waters.

The six-column unit carries accommodation for 400 persons complete with full recreational facilities. It is compact, cost effective and capable of operating alongside fixed platforms, with a complement of a fully redundant Dynamic Positioning System, a high crane capacity and fire fighting capabilities.

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

Keppel O&M, a wholly-owned subsidiary of Keppel Corporation Limited, is a global leader in offshore rigs and ship conversion and repair as well as a specialised shipbuilder. Its near market, near customer strategy is bolstered 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.