Floating hotels are the next best thing in rig building

More development work in the deeper and harsher environment has led to the demand for larger accommodation vessels/ rigs, says CIMB.

Keppel has entered into a Letter of Intent (LOI) with repeat customer, Floatel International (Floatel) to
build a new generation harsh environment accommodation semi-sub worth US$315m.

The rig, which can be operated in the North Sea (440-persons accommodation) is scheduled for delivery in Jul-2014.

This will be the forth accommodation rig to Floatel after KEP’s delivery of Floatel Superior and Floatel Reliance in 2010 and Floatel Victory under construction currently.

Analyst Lim Siew Khee says that CIMB believes that niche equipment such a floating hotels, specialised harshenvironment rig such as CJ70, CJ80 are the” next best thing in the rig-building segment, replacing the lack of jack-up orders.

“Larger accommodation rigs are increasingly popular for their space and enhanced facilities as development are located deeper water,” she notes.
“With this contract, KEP’s YTD order reached about S$580m, still in line with our non-Brazilian order of S$2bn. Including Brazilian semi-subs, we expect KEP to secure about S$7.5bn of orders in 2012,” added Ms. Lim.