25 Nov 2010

Keppel wins US$180 mil KFELS B Class jackup rig contract from Standard Drilling

Keppel FELS Limited (Keppel FELS) has secured an order for a KFELS B Class jackup rig worth US$180 million from Standard Drilling Ltd (Standard Drilling), a subsidiary of Norwegian investment company, Ferncliff TIH AS Group (Ferncliff).

As part of the agreement, Standard Drilling has been given options to build another two similar jackup units. If exercised, the options for the additional two rigs will bring the total contract value to about US$550 million.

The first rig is slated for delivery in 2H 2012.

Mr Martin Nes, CEO of Ferncliff TIH AS, said, "We are seeing activities and opportunities in the jackup market recovering quickly and are positive that this demand for newer, safer, high-specification jackups will be sustained, given the growing need worldwide for premium units with capabilities to operate safely in more challenging locations.

"To create stable and long-term value for our stakeholders, we believe in working with partners with specialist expertise, good management and world leading technology, to develop our assets that will give a good foundation for future growth.

"Rigs built to the KFELS B Class design are known to be highly efficient drilling platforms with industry-leading features for safety and environmental friendliness and boast a proven track record. We are pleased to work with Keppel FELS on building a premium jackup drilling rig of this design, which we are confident, will become a first class asset to our portfolio."

Mr Wong Kok Seng, Executive Director of Keppel FELS, said, "The innovative and cost-effective KFELS B Class jackup rig has proven itself to be the trusted, reliable workhorse of the industry, and has performed well in major offshore exploration and development programmes in various locations.

"Including Standard Drilling's order, a total of 35 KFELS B Class rigs have been ordered to date. 32 of these have already entered the market and are constantly delivering excellent operational and safety performance for their operators."

Developed by Keppel's technology arm, Offshore Technology Development, the KFELS B Class jackup design provides maximum uptime with reduced emissions and discharges. For its environmental-friendly features, the KFELS B Class design was bestowed the Prestigious Engineering Achievement Award from Institution of Engineers Singapore in 2009.

Readily upgradeable to higher performance capabilities, KFELS B Class rigs incorporate Keppel's advanced and fully-automated high capacity rack and pinion elevating system, and Self-Positioning Fixation System. When completed, this rig will be able to operate in water depths of 400 feet, drilling depth of 30,000 feet and accommodate 120 men.

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

About Ferncliff TIH AS

Established in 1995, the Ferncliff TIH AS group is a Norwegian investment company with the head office at Skøyen in Oslo and is owned by Mr. Øystein Stray Spetalen. For 2009, the group recorded a profit of NOK 26 million and a book equity value for the group of NOK 1,714 million.

The group is involved in direct active investments in offshore drilling rigs, and has initiated or been on the ownership side in connection with the contracting or acquisition of a total of 17 rigs, consisting of 7 semisubmersibles, 2 drillships, 3 drilling tender barges and 5 jackup rigs. Ferncliff has been a substantial shareholder in offshore drilling companies, such as Standard Drilling ASA, Songa Offshore ASA, Offshore Rig Services ASA, Ferncliff Drilling ASA, and Singapore Drilling AS. For more information, visit: http://ferncliff.no/.

About Keppel FELS

Keppel FELS is a subsidiary of Keppel Offshore & Marine Ltd (Keppel O&M), a wholly-owned company of Keppel Corporation Limited. Keppel O&M is a leader in offshore rig design, repair and construction, shiprepair and conversion and specialised shipbuilding. Its near market, near customer strategy is bolstered by a global network of 20 yards and offices 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 for solutions for the offshore and marine industry.

For further information, please contact:
Diana Chan (Ms)
Senior Executive
Keppel Group Corporate Communications
Tel: (65) 64136 430
Email: diana.chan@kepcorp.com