Keppel to Divest Oil Rigs for $3.7 Billion Amid Strategic Shift

SINGAPORE – Keppel Corporation, a major player in the offshore and marine sector, has announced plans to divest up to ten oil rigs for a total of approximately $3.7 billion. This move is part of a broader strategy to optimize its asset management and reduce debt.

According to a statement released on July 27, Keppel's indirect subsidiary, Rigco Holding, will sell six operational rigs to the private fund Keppel Offshore Fund (KOF) for $1.2 billion, with the transaction expected to generate cash proceeds of about $478 million (S$617 million) in 2026. Additionally, Keppel intends to sell four rigs currently under construction to KOF between 2027 and 2028, which could yield another $988 million in cash.

This divestment is anticipated to increase Keppel's funds under management by around $3.9 billion, further advancing the company's efforts to monetize non-core assets. The company stated that the transaction would also help alleviate its debt burden and provide capital for new investments.

“The transaction is expected to add around $3.9 billion to Keppel’s funds under management.”Keppel Corporation, official statement

However, this strategic shift comes with an immediate financial impact. Keppel is expected to report an accounting loss of $92 million from the divestment of the six operational rigs in its first-half results, scheduled for release on July 30.

Keppel's decision to divest these assets reflects ongoing challenges in the oil and gas sector, where fluctuating demand and prices have prompted many companies to reassess their portfolios. Analysts indicated that this move positions the company to capitalize on emerging opportunities in the energy transition and renewables sectors.