Keppel has won a US$51 million extension lease from Arabian Drilling Company to lease one of its rigs for another five years.
The charter, won via Keppel unit RigCo is for the AD110 rig now already used in Saudi Arabia by ADC’s own customer.
The AD110 rig is one of the six operational rigs identified under Keppel’s approximately $3.7 billion1 programme announced in July to progressively monetise up to 10 legacy rigs through Keppel Offshore Fund (KOF).
Under the programme, the six operational rigs are expected to be divested to KOF in 2026, subject to the satisfaction of certain conditions.
The programme is designed to advance the monetisation of legacy assets while increasing Keppel’s funds under management and generating recurring asset management income.
Keppel says the charter extension reflects continuing demand for modern, high-specification jackup rigs in key offshore markets.
The AD110 rig was among the rigs deployed to Saudi Arabia under bareboat charter arrangements secured in 2022.
Since then, utilisation and day rates for jackup rigs have continued to remain solid amid growing preference for modern drilling units with extremely limited additional supply under construction.
“We are actively pursuing further charter contracts and renewals across our rig portfolio to strengthen contracted cash flows and enhance asset value ahead of monetisation. The transaction also reflects improving sentiment in the offshore drilling market and sustained demand for modern jackup rigs from leading operators in the Middle East,” says Keppel.
Keppel shares closed at $10.09 on Oct 30, down 1.46%.
Source: The Edge Singapore