Seatrium To Complete Four Offshore Drilling Rigs For Keppel In S$500 Million Deal

Singapore-based Seatrium will complete four unfinished offshore drilling rigs owned by Keppel subsidiary RigCo under a deal worth more than S$500 million ($390 million), as the offshore drilling market shows signs of improving demand for advanced rigs.

The work covers a seventh-generation drillship, a harsh-environment jack-up rig and two mid-water semisubmersibles designed for operations in the challenging conditions of Northwest Europe. It will be carried out under an existing master services agreement between Seatrium and RigCo.

The drillship is scheduled for delivery in 2027, while the jack-up rig is expected to be delivered in 2028. Plans for completing the two semisubmersibles are still under assessment.

RigCo will finance the work using its existing cash reserves, according to the companies.

The four rigs remained unfinished legacy assets after Keppel’s offshore and marine business combined with Sembcorp Marine to form Seatrium in 2023.

Seatrium said the work would draw on its experience in offshore rig design, engineering, construction, upgrades and lifecycle services. More than two-thirds of the world’s operational jack-up rigs are based on the company’s designs, including one of RigCo’s units, it said.

Completing the drillship and jack-up rig could prepare them for potential charter opportunities. However, the companies have not announced confirmed charters for any of the four units.

The construction plans and delivery schedules for the two semisubmersibles have yet to be confirmed.

The agreement forms part of Keppel’s programme, announced in July 2026, to progressively monetise up to 10 legacy offshore rigs through the Keppel Offshore Fund. Keppel manages the fund, with Apollo participating as a limited partner.

RigCo already owns six modern jack-up rigs that have been delivered and leased to customers since 2022. The four unfinished rigs covered by the Seatrium agreement complete its 10-rig portfolio.

Under the broader plan, the six operational jack-up rigs were earmarked for transfer to the fund for about S$1.2 billion ($938 million). Keppel has estimated that transferring the four additional rigs after completion could generate about S$1.3 billion ($1 billion) in cash proceeds.

Apollo-linked investors have committed $1.5 billion to the fund. Keppel has described the wider monetisation programme as a S$3.7 billion ($2.89 billion) initiative.

The four unfinished rigs must be completed before they can progress towards the planned transfer and monetisation.

The deal comes after more than a decade of limited newbuild activity in the offshore drilling sector and the gradual retirement of older rigs.

Higher utilisation rates, an ageing global fleet and structural constraints on the supply of available rigs are supporting the outlook for demand.

Cindy Lim, Keppel’s chief executive for infrastructure and a non-executive director of RigCo, said demand for deepwater and harsh-environment rigs was expected to rise over the next several years, creating opportunities for new, long-term charters.

Lim said RigCo was working with customers to understand their requirements as the market for advanced offshore rigs tightened.

The agreement gives Seatrium a role in completing the four rigs, while Keppel’s wider plan aims to turn the legacy assets into cash-generating opportunities. The timing of any future charters will depend on customer commitments and the completion of the vessels.

References: offshore energy, keppel