As aging global fleets and heightened energy security concerns drive renewed demand for offshore drilling, RigCo, a wholly owned subsidiary of Keppel, has partnered with Singapore’s Seatrium to complete the construction of four legacy offshore rigs. The initiative positions RigCo to capitalize on a tightening offshore drilling market while paving the way for potential asset monetization through the Keppel Offshore Fund.
Under an existing master services arrangement, the duo will collaborate on the completion of construction work in respect of four offshore rigs owned by Keppel’s subsidiary, which comprise a premium seventh-generation drillship, a harsh environment jack-up, and two mid-water semi-submersibles suited to work in the harshest environments of Northwest Europe.
Cindy Lim, Chief Executive Officer at Infrastructure of Keppel and Non-Executive Director of RigCo, commented: “The demand for deepwater and harsh environment rigs is expected to increase over the next several years, providing conducive conditions for new, long-term charters of premium rigs. RigCo has been working closely with customers on their requirements amid the tightening market for advanced offshore rigs.
“The resumption of construction work marks an important milestone in Keppel's strategy to transform RigCo’s work-in-progress offshore rigs into high-quality, income-generating assets. Their phased completion is part of Keppel’s program, announced in July 2026, to progressively monetize up to 10 legacy rigs through the Keppel Offshore Fund, managed by Keppel, and co-invested with Apollo as limited partner.”
The total estimated contract value for the construction of all four rigs of more than S$500 million will be funded by existing cash retained in RigCo, which has six modern jack-ups that have been delivered and leased to customers beginning in 2022. The company’s remaining uncompleted assets include a harsh environment jack-up, a premium drillship, and two harsh environment semi-submersibles.
The drillship and the harsh environment jack-up are expected to be delivered to Keppel’s subsidiary in 2027 and 2028, respectively, positioning them for charters and supporting monetization through the Keppel Offshore Fund, while construction plans for the remaining two rigs are being assessed.
William Gu, Executive Vice President of Seatrium Energy (Marketing), said: “Seatrium has a long and distinguished global track record for the full lifecycle of high specification offshore rigs from design to build, upgrades, life extension and operational optimi\ation. Today, more than two-thirds of the world's operational jack-up rigs are based on Seatrium's designs, including one of the units for RigCo.
“This award reflects our undisputed capabilities to deliver complex projects safely, efficiently and to the highest quality standards. We look forward to leveraging our integrated capabilities and execution excellence to support RigCo in realizing the full potential of these premium assets.”
Alongside the heightened need for energy security, the resumption of rig construction is expected to create value for both companies. RigCo emphasizes that offshore rig market fundamentals are improving, underpinned by higher utilization rates, an aging global drilling fleet, and structural supply constraints, following more than a decade of limited newbuild activity and the progressive retirement of older rigs.