Ensco, Keppel Fels JV to build new jack up

March 17, 2003
A unit of Ensco International Inc. and Keppel Fels Ltd. jointly agreed to acquire a 25% ownership interest in a new, high-performance jack up that Keppel Fels will construct in Singapore.

By OGJ editors
HOUSTON, Mar. 17 -- An Ensco International Inc. unit, Dallas, and Singapore-based Keppel Fels Ltd. jointly agreed to acquire, for $26.25 million in cash and project management services, a 25% ownership interest in a new, high-performance jack up that Keppel Fels will construct in Singapore.

The "Ensco 106" rig will be an enhanced KFELS Mod V (B) design, modified to Ensco specifications, and will be capable of handling demanding applications worldwide. The enhanced design will be designated as "Bigfoot."

Rig construction will total $105 million. In addition to its initial 25% ownership, Ensco reserved an option to purchase the remaining 75% interest within 2 years after delivery.

Delivery is expected in first quarter 2005, after which Ensco will market, manage, and operate the rig under charter from the joint venture.

Ensco is in the process of upgrading its fleet, increasing its applicability for deeper water and more-challenging environments. It entered into a similar agreement in 2000 with Keppel Fels for the $130 million harsh-environment Ensco 102 jack up, now in use (OGJ Online, Dec. 15, 2000), and prior to that, its Ensco 7500 dynamically positioned semisubmersible rig (OGJ, Nov. 13, 2000, p. 50).

Recently Ensco sold 27 support vessels operating in the Gulf of Mexico that had an average age of 19 years to New Orleans-based Tidewater Inc. for $79 million (OGJ, Mar. 17, 2003, p.42).

"As drilling requirements become more stringent and fleet renewal becomes imperative, we believe balance between capability and cost will be crucial," said Carl Thorne, Ensco's chairman and CEO. "We are confident that the Bigfoot design will optimize our philosophical criteria (within the premium jack up market), and are most pleased that Keppel Fels has again agreed to be our partner in this project."