Keppel Delivers West Setia to Smedvig

Keppel FELS has delivered the latest semisubmersible drilling tender, West Setia, to Smedvig Tender Rigs Pte Ltd on August 2, 2005.

The delivery firmly places Keppel FELS as the leader and pioneer in the design and construction of purpose-built semisubmersible drilling tenders (SSDT) for deepwater operations.

Keppel FELS co-designed and built the first SSDT, West Pelaut, in 1994 as the world's first purpose built semi-submersible tender rig for production drilling for Brunei Shell. Two more semi-submersible drilling tenders based on Keppel FELS' enhanced design were subsequently built.

Like these three drilling tenders: West Pelaut, West Menang and West Alliance, West Setia will be deployed by Brunei Shell as her maiden project.

With the delivery of West Setia, Keppel FELS has also divested its entire 72% interest in the rig to Smedvig at an agreed purchase price of US$65 million (S$110 million).

Mr. Staale Roed, Managing Director of Smedvig, said, "West Setia will be the fourth of five SSDTs designed and built by Keppel for Smedvig.

"Our relationship with Keppel is one that has grown from strength to strength. We have been impressed with the design, engineering and construction capabilities of Keppel FELS. We are confident that the fifth drilling tender will be delivered on time and within budget."

Mr. Tong Chong Heong, Managing Director/Chief Operating Officer of Keppel O&M, said, "We are seeing a growing interest in purpose-built supporting units such as drilling tenders and accommodation platforms. They are attractive options for operators and drilling contractors because they are efficient and cost effective solutions for deepwater operation in harsher environments."

Developed by the Deepwater Technology Group (DTG), West Setia is being built to Keppel Offshore & Marine's (Keppel O&M) proprietary design, KFELS SSDT 3600-GOM-C42.

Incorporating the latest technological advances, the six-column drilling tender has the flexibility for deployment in deeper waters and harsher environments. It carries a drilling derrick set and has cranage to deploy this derrick set onto production platforms. It also provides storage and accommodation facilities, and complements other drilling platforms. West Setia ('Setia' meaning 'Loyal') was officially named by Mrs. Debbie Straub, wife of Mr. Brian Straub, Vice President of Technical-Asia Pacific Shell EP International, at Keppel FELS in a gathering of local and overseas guests.

West Setia is one of the first offshore rigs to be registered in Singapore since the Maritime and Port Authority of Singapore (MPA) opened its Singapore Registry of Ships (SRS) to include offshore industry mobile units in January 2005.

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 specialised shipbuilder. Its near market, near customer strategy is boosted 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 a provider of choice and a partner in solutions for the offshore and marine industry.

Smedvig Tender Rigs Pte Ltd is a wholly owned subsidiary of leading offshore drilling contractor, Smedvig asa of Norway. Smedvig is the largest operator of self-erecting tender rigs used for production drilling and well maintenance in Southeast Asia and West Africa, a position the company aims to maintain.

The transaction for the divestment of West Setia is not expected to have any material impact on the net tangible assets and earnings per share of Keppel Corporation for the financial year ending 2005.

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