Seatrium and Keppel move to complete four offshore drilling rigs
Seatrium Limited and RigCo Holding, a wholly owned subsidiary of Keppel Ltd., have announced plans to complete construction work on four offshore drilling rigs under an existing master services arrangement between the companies.
The estimated contract value for the construction work exceeds S$500 million, with funding to come from cash already retained within RigCo. The agreement covers a seventh-generation drillship, a harsh-environment jackup rig and two mid-water semisubmersible rigs designed for demanding offshore conditions.
The drillship is expected to be delivered to RigCo in 2027, followed by the jackup rig in 2028. Construction plans for the two remaining semisubmersible units are still being assessed, meaning that delivery schedules have not yet been established for those assets.
Construction programme supports Keppel’s offshore asset strategy
The resumption of construction forms part of Keppel’s broader programme to monetise its portfolio of unfinished offshore drilling assets.
In July 2026, Keppel announced plans to progressively monetise up to ten legacy rigs through the Keppel Offshore Fund, which is managed by Keppel and includes Apollo as a limited partner.
The phased completion of the rigs is intended to transform unfinished assets into operational drilling units that can be offered for charter and potentially generate income.
Cindy Lim, Chief Executive Officer, Infrastructure of Keppel and Non-Executive Director of RigCo, said the company expects demand for deepwater and harsh-environment drilling rigs to increase over the coming years, creating opportunities for long-term charter arrangements.
According to Lim, RigCo has been working with potential customers to understand their requirements as the market for advanced offshore drilling equipment tightens.
The company views the construction programme as an important step towards converting its work-in-progress rigs into income-generating assets.
Seatrium to undertake completion work
Seatrium will provide engineering and construction capabilities to support the completion of the four offshore units.
The company has experience across the offshore drilling rig life cycle, including design, construction, upgrades, life extension and operational optimisation.
William Gu, Executive Vice President of Seatrium Energy (Marketing), said the agreement reflects the company’s capabilities in delivering complex offshore projects and supporting the development of high-specification drilling assets.
The rigs covered by the arrangement include units intended for demanding operating environments. The two semisubmersibles are suited to offshore conditions in Northwest Europe, while the jackup belongs to the harsh-environment category.
According to Seatrium, more than two-thirds of the world’s operational jackup rigs are based on its designs, including one of the units owned by RigCo.
The company will work with RigCo to complete the relevant construction activities under the existing contractual framework.
Offshore drilling market provides backdrop
The companies linked the decision to resume construction to improving conditions in the offshore drilling market.
According to their joint announcement, more than a decade of limited newbuilding activity, combined with the progressive retirement of older rigs, has contributed to tighter availability of modern offshore drilling assets.
They also pointed to higher utilisation rates, an ageing global drilling fleet and structural supply constraints as factors supporting the outlook for advanced drilling units.
RigCo currently has six modern jackup rigs that have been delivered and leased to customers since 2022. Its remaining unfinished portfolio consists of the drillship, harsh-environment jackup and two semisubmersibles covered by the latest arrangement.
The completion programme is expected to position the drillship and jackup for potential charter opportunities following their scheduled deliveries in 2027 and 2028.
However, the companies have not announced specific charter contracts for these units or confirmed completion schedules for the two semisubmersibles.
The agreement marks a further step in Keppel’s efforts to realise value from its remaining offshore drilling assets while providing Seatrium with additional construction work under its existing relationship with RigCo.
