Keppel to build SSDT with Smedvig

Keppel FELS Ltd. has entered a cooperation agreement with Smedvig Asia Ltd. (Smedvig Asia) to build a semisubmersible drilling tender (SSDT) using Keppel Offshore & Marine's proprietary design. Developed by the Deepwater Technology Group (DTG), the KFELS SSDT3600-GOM-C42 will be the fourth SSDT deployed in this region.

Keppel FELS Ltd. has entered a cooperation agreement with Smedvig Asia Ltd. (Smedvig Asia) to build a semisubmersible drilling tender (SSDT) using Keppel Offshore & Marine's proprietary design. Developed by the Deepwater Technology Group (DTG), the KFELS SSDT3600-GOM-C42 will be the fourth SSDT deployed in this region.

Valued at $94 million, Keppel FELS and Smedvig Asia will own and operate the ultra-deepwater SSDT on a 72/28 basis, respectively. The newbuild is due for completion in the third quarter of 2005.

Under the agreement, Keppel FELS will build the rig, while Smedvig Asia will contribute the drilling equipment. Smedvig will also be responsible for marketing, managing and operating the rig for a 10-year period, during which it has an option to purchase Keppel FELS' interest in the rig.

This co-operation agreement is similar to Keppel Shipyard's arrangement with Smedvig Asia to build SSDTWest Alliance in 2001. In that project, Smedvig Asia exercised its option to purchase Keppel Shipyard's stake in the SSDT upon project completion.

"The KFELS SSDTs have improved motion characteristics and larger variable load capacity and deck space, which give operators greater flexibility in the exploration and production of offshore oil and gas," said Mr Tong Chong Heong, MD & COO of Keppel O&M. "These qualities have opened up new opportunities for tender rigs to work alongside tension leg platforms and spars, which operate in deeper waters,"

The three other SSDTs in the region areWest Alliance, West Menang and West Pelaut. West Alliance is currently being deployed by Unocal, while West Menang and West Pelaut are on charter to Brunei Shell/Total and Brunei Shell respectively.

4/2/04

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