Keppel secures USD560M contract from Maersk

There's nothing like a repeat contract worth around US$560 million to say "job well done".

Keppel bags a third round of CJ70 rig orders from Maersk.

In a news release, Keppel FELS Limited announced it has been awarded a contract from Maersk Drilling Holdings Singapore Pte Ltd, a wholly owned subsidiary of A.P. Moller - Maersk A/S, to build a repeat Gusto MSC CJ70 ultra harsh environment jackup rig worth about US$560 million.

Scheduled for delivery in 1Q 2015, the rig will be deployed in Dagny field in the Norwegian North Sea for Statoil when completed.

This is the third CJ70 jackup rig that Keppel FELS is building for Maersk Drilling, following an order for two such rigs in February 2011. As part of this repeat order, Maersk Drilling will have an option to build an additional jackup rig of the same design with Keppel FELS.

Mr Tong Chong Heong, CEO of Keppel Offshore & Marine, said, "Our congratulations to Maersk for winning the confidence of Statoil. We are pleased to be given this opportunity to partner Maersk Drilling in their project for Statoil. Having developed a long-term partnership with Maersk Drilling, we have a keen understanding of their requirements, enabling us to support them in growing their rig fleet.

"We thank Maersk Drilling for entrusting us with their third harsh environment jackup. This repeat order is a testament to our ability to deliver high quality rigs on time, safely and within budget. I am confident that, like our previous rigs for Maersk Drilling, the three CJ70rigs will be a success when they are deployed."

Mr Claus V. Hemmingsen, CEO of Maersk Drilling and Member of the Executive Board of the A. P. Moller - Maersk Group added, "Maersk Drilling already operates six ultra harsh environment jackup rigs in Norway, and the addition of three more high specification units will further solidify our stronghold in this attractive market. We have chosen to work with Keppel FELS as they have proven to be a professional partner and supplier of state-of-the-art drilling units, helping us to meet the needs of our customers."

The CJ70 rigs are designed for operation in the harsh environment of the North Sea, at water depths of up to 150 metres. The high capacity features include offline pipe handling and simultaneous operations as well as an enlarged cantilever reach, which will significantly increase the drilling efficiency compared to conventional units. The enhanced design also includes multi-machine control on the drill floor that adds a degree of automation to ensure a safe operation and consistent performance. A total of 150 people can be accommodated on board in single cabins.

The above contract is not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

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