KEPPEL FELS, a wholly-owned subsidiary of Sembcorp Marine : S51 0% (Sembmarine), was awarded in favour in its arbitration against a unit of Awilco Drilling.

The company commenced the process in June 2022 to enforce its rights against Awilco Rig 1 (AR1).

Keppel FELS issued a notice of termination in June last year to AR1 after it had defaulted on an instalment payment for the construction of a mid-water semisubmersible drilling rig for harsh environment use, said Sembmarine on Monday (Apr 24).

The parties had entered into a contract worth US$425 million in March 2019 for the construction of the rig. However, Keppel FELS assessed that AR1 was unable to make its second instalment payment that was due in March 2021.

Sembmarine noted that the outcome of the arbitration is not expected to have any material impact on its net tangible assets or earnings per share for FY2023.

This is the second time a contract between Keppel FELS and AR1 has been terminated. 

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

The first contract, for the construction of a mid-water drilling rig, was axed in June 2020. This contract was also worth US$425 million. 

Shares of Sembmarine closed flat at S$0.123 on Friday.