Singapore's Keppel said on Wednesday that it had reached a deal with the offshore drilling company Borr Drilling over the delivery schedule for five jack-up rigs ordered previously by Borr Drilling.
The rig builder had in 2020 and 2021 agreed with Borr Drilling to defer the scheduled delivery of five jackup rigs to Borr Drilling to 2023.
The new agreement will see the accelerated delivery of three jack-up rigs to Borr Drilling or a third party to whom Borr Drilling plans to sell the rigs, and the postponement of delivery of two remaining rigs.
Under the agreement, Keppel's offshore rig-building subsidiary Keppel O&M will receive more cash payments earlier and reduce its overall financial exposure to Borr Drilling.
Keppel said it would receive at least $352 million between 2022 and 2023, representing full payments for the first three rigs with accelerated deliveries, with seller's credit arrangements for two of these rigs cancelled.
The first three rigs will be delivered between October 2022 and July 2023. Deliveries of remaining two rigs will be deferred to 2025.
All three jack-up rigs will be delivered with full payments (including holding costs and cost cover) on delivery,
amounting to at least US$352 million in aggregate, out of which at least US$158 million will be payable
in 2022. These new arrangements will become effective immediately, Keppel said Wednesday.
As for the two remaining rigs, Borr Drilling will pay holding costs and cost cover.