Singapore's Keppel Corporation Ltd, the world's top offshore drilling rig maker, said it plans to build its first drillship despite not having a buyer lined up

Singapore's Keppel Corporation Ltd, the world's top offshore drilling rig maker, said it plans to build its first drillship despite not having a buyer lined up, confident the design will be welcomed by the market.

It is the first time Keppel has built a rig without a contract in at least 14 years, an examination of company announcements showed.

A leading builder of jackup rigs, which work in water depths up to 500 feet (152 metres), Keppel has yet to build a drillship from scratch and has been trying to secure a contract for its own drillship design this year.

South Korea's shipbuilding giants, Samsung Heavy Industries Co Ltd, Daewoo Shipbuilding & Marine Engineering Co Ltd and Hyundai Heavy Industries Co Ltd, dominate the market for drillships, which are used to explore oil and gas in water up to 12,000-feet deep and cost at least $500 million a piece to build.

Keppel said in a statement that its new design would overcome the constraints of limited deck space found in most drillships. Construction is expected to be completed in 2016.

Keppel had expected to get the order for the drillship by the end of next year, Tong Chong Heong, chief executive officer of Keppel Offshore & Marine, said at a results briefing in October.

Keppel had bagged new orders of S$6.8 billion by late November, and is on track to deliver a record number of rigs this year. But growing competition from Chinese shipyards have put a lot of pressure on the company's profit margins in recent years.

The firm's share price closed at S$10.8 on Wednesday, up 2.4 percent so far this year, outrunning the benchmark Straits Times Index's 3.4 percent decline.

http://www.reuters.com/article/2013/12/12/keppel-drillship-idUSL3N0JR02M20131212?type=companyNews

Keppel Corporation

With a global footprint in over 30 countries, Keppel Corporation leverages its international network, resources and talents to grow its key businesses. It aims to be the Provider of Choice for Solutions to the Offshore & Marine Industries, Sustainable Environment and Urban Living, guided by its key business thrusts of Sustaining Growth, Empowering Lives and Nurturing Communities.

The Keppel Group of Companies includes Keppel Offshore & Marine, Keppel Infrastructure, Keppel Telecommunications & Transportation (Keppel T&T) and Keppel Land, among others.

Keppel Offshore & Marine is the leader in offshore rig design, construction and repair, ship repair and conversion and specialised shipbuilding. Its Near Market, Near Customer strategy is bolstered by a global network of 20 yards and offices in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions.

Keppel Infrastructure will drive the Group's strategy to invest in, own and operate competitive energy and related infrastructure. Keppel Infrastructure, while tapping the expertise and technology of its engineering business, will grow its power and gas, environmental and energy efficiency businesses.  Keppel T&T is a leading service provider in the Asia-Pacific and Europe with businesses in logistics and data centres.

Keppel Land contributes to changing cityscapes across Asia as a choice developer with a sterling portfolio of award-winning residential developments, integrated townships and investment-grade commercial properties. Reputed for its quality and innovation hallmark, Keppel Land is committed to develop properties that harmonise with the urban and natural landscape for desirable live-work-play environments and with enduring value for the community.

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