Keppel Delivers PV Drilling I Two Months Ahead of Schedule

Keppel FELS has delivered the PV DRILLING I, a KFELS B class jackup to PetroVietnam Drilling and Well Services Joint Stock Company.

The project, which was signed on February 22, 2005 was delivered to its owner on March 7, 2007, ahead of time and within budget. This is two months ahead of its contractual delivery schedule.

Keppel FELS' ability to deliver ahead of schedule has enabled PV Drilling I to start work earlier for Hoan Vu Joint Operating Company.

During the naming ceremony at Keppel FELS in Singapore today, Mr. Choo Chiau Beng, Chairman/Chief Executive Officer of Keppel O&M, said, "To deliver a rig two months early during this very busy period in the market is something special. It demonstrates the strong core values and close collaboration of both our companies. We have developed a strong working relationship characterized by teamwork, flexibility and mutual understanding."

Significantly, this feat was accomplished without any lost time incident in over 2.5 million man-hours. Keppel O&M's commitment to safety saw their 10-year low Accident Frequency Rate of 1.62 for the Group's Singapore yards in 2005 further improved to 1.20 in 2006.

Mr. Lim Hng Kiang, Minister for Trade and Industry for the Republic of Singapore who graced the ceremony, said, "Keppel FELS has cause to celebrate as they have again delivered a new rig on-time and on-budget. With over 1,000 people working onboard the rig at any one time, the company has done well in ensuring that every worker who comes to work goes home safe.

"Above all, I am told that its owner, PV Drilling, is pleased with the quality of this rig. I am glad that companies like Keppel are constantly innovating to develop new designs with new capabilities to meet market needs and stay ahead of competition."

Built to Keppel's proprietary design, the KFELS B Class rig is PV Drilling's first newbuild jackup. PV DRILLING I is also the 13th KFELS B Class rig delivered since its introduction in 2000. This demonstrates rapid market acceptance of a Singaporean proprietary design.

PV DRILLING I is customized to PV Drilling's specifications for operations in water depths of up to 300 feet and drilling depths of down to 20,000 feet. The rig can accommodate up to 110 men and is readily upgradeable for higher drilling capabilities in water depths of up to 350 feet. With the delivery, it will be deployed offshore Vietnam.

Mr. Tran Ngoc Canh, President, Vietnam Oil and Gas Group said," This is not the first time we have cooperated with Keppel FELS who have proven they are one of the most technically capable shipbuilding companies in the world. As you well know, PetroVietnam and Keppel KFELS have a good long-term relationship since we have had opportunities to work together in some important projects. With the completion of PV Drilling I jack up rig two months before the contract deadline, it proved a most judicious decision of PetroVietnam and PV Drilling to award the contract to Keppel FELS, marking an important step in a good relationship between PetroVietnam as well as Keppel Offshore & Marine."

Keppel FELS has been actively involved in Vietnam since the 1980s. In 1984, Keppel FELS build Hoang Sa, a 1,200-tonne floating crane. Later in 1988, it delivered Vietnam's first drilling rig, Tam Dao 1, for Vietsovpetro, a Vietnam-Russian joint venture.

Beyond the offshore market, sister company Keppel Land has invested over US$650 million dollars in eight real estate projects while Keppel Integrated Engineering is undertaking two wastewater treatment plants in Vietnam.

On Vietnam, Minister Lim said, "The country is also fast becoming a key regional oil and gas exporter with over 600 million barrels of proven oil reserves."

He added, "Singapore is happy to participate in and contribute to the growth of Vietnam."

Trade between Singapore and Vietnam rose by 8.64% to S$11.3 billion in 2006, making Singapore Vietnam's fourth largest trading partner(1). Likewise, the Vietnamese market plays an important role in Singapore's economy. With S$8.7 billion worth of exports in 2006, Vietnam is Singapore's 14th largest export market(2) .

1 Vietnam's top trading partner in 2006 was China. Source: Vietnam Ministry of Trade

2 Source: IE Singapore – Vietnam Market Information: Bilateral Trade

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