Singapore’s Keppel Offshore & Marine, the world’s largest rig builder, says it has entered into an agreement for the acquisition of Houston-headquartered Cameron International Corporation’s offshore rigs business for $100 million.
The acquisition, which was made through Keppel’s wholly owned subsidiary Keppel Offshore & Marine USA, comprises Cameron’s trademarked LETOURNEAU jack-up rig designs, rig kit business and aftermarket services.
The LETOURNEAU suite of jackup rig designs are established designs that have been popular with certain market segments and have a proven track record of operating in a variety of environments.
Keppel says the acquisition will add to its offerings in the jackup rig market by giving it the ability to offer LETOURNEAU designs and rig kits to shipyards and deliver ready-to-drill solutions from Keppel years worldwide. The designs Keppel is acquiring include the LETOURNEAU Super 116E, WORKHORSE, Super Gorilla XL and Jaguar. The rig kits include jackup leg components, elevating units/jacking system and cantilever/skidding system, as well as support equipment.
Another aspect of the business is the provision of aftermarket services, such as servicing and repair for the approximately 100 LETOURNEAU rigs currently operating around the world. Besides repairs, upgrades and modifications, jackups are required to undergo five-year Class recertification special periodic surveys.
Keppel itself has already built 16 rigs based on LETOURNEAU designs.
“This is an opportune and strategic acquisition as it will not only broaden our suite of jackup rig design offerings in this highly competitive sector, but also provide us with enhanced capabilities to service customers through the provision of expanded aftermarket sales and services,” commented Mr Chow Yew Yuen, CEO of Keppel O&M. “We are confident that the long-term fundamentals of the offshore rig market remain positive.”
Commenting on the recent crash in oil prices and its impact on the offshore rig market, Yuen added:
“With the current low oil price, we have seen a slowdown in newbuild rig orders. Rig owners are instead looking at repairing and upgrading their current fleet. We believe that we can make best use of our after sales service infrastructure to service rigs of both the LETOURNEAU as well as Keppel FELS designs. These are popular designs operating in many of the world’s offshore oil fields and rig owners can now utilize our global network of yards to service and maintain their rig assets cost-effectively.”