Singapore's Keppel Offshore & Marine has signed bareboat charter contracts with the Saudi drilling firm ADES for two jack-up rigs to be deployed in Saudi Arabia. This brings the total number of rigs Keppel O&M has on a charter with ADES to four.
The charters will be for a period of five years and are expected to start in 1H 2023.
Keppel O&M said the charters were projected to generate total revenue of about S$155 million ($112,4 million) for Keppel O&M, which includes modification works to prepare the rigs for deployment.
"These are the fifth and sixth bareboat charters secured by Keppel O&M this year, pointing to the continued demand for more high-quality drilling rigs of Keppel’s proven KFELS B Class design," Keppel O&M said.
The company in October said it had completed the modification works for four first KFELS B Class jack-up rigs, which will be deployed on bareboat charters in Saudi Arabia.
The two latest jackup rigs chartered by ADES, are the Cantarell III and Cantarell IV, which were under bareboat charters with subsidiaries of Grupo R.
"These charters [with Grupo R] have since been terminated due to unremedied events of default under the bareboat charters by the charterers. The rigs, which will be renamed ADM685 and ADM686, are currently in Mexico and will be transported to Saudi Arabia for modification works before commencing their charters for ADES," Keppel O&M said.
Tan Leong Peng, Managing Director (New Builds) of Keppel O&M, said, “We are pleased to receive a repeat contract from ADES for the charter of another two of our jackup rigs. These high-performance rigs have been operating successfully in Mexico and can be easily mobilized to work in Saudi Arabia. They are equipped with our AssetCare digitalization solution, which increases the efficiency, safety, and operability of the rigs."
"All of our KFELS B Class legacy jackup rigs have secured bareboat charters or are on contract, which reflects the value our rigs bring to rig operators and increases their marketability for sale to potential buyers and investors. Utilization rates across both the jackup and floater segments have continued to trend upwards, and we are confident our versatile and robust legacy rigs will be in demand across a variety of markets.”
As part of the definitive agreements Keppel Corporation has signed in connection with the proposed combination of Keppel O&M and Sembcorp Marine, these two rigs are part of Keppel O&M’s legacy rigs and they, as well as their bareboat charter agreements, will be transferred to Asset Co that is majority-owned by external investors, on legal completion.
Worth noting, back in October, ADES acquired seven Seadrill offshore rigs, taking ADES’s total offshore fleet to 48 rigs, "making the group the largest jack-up operator in the world."
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