Tuesday, 28 July 2026

Keppel has opened a program to monetize as many as 10 legacy offshore drilling rigs through the newly created Keppel Offshore Fund, a transaction valued at roughly USD 2.86 billion, Offshore Engineer OEDigital reported.

The first tranche covers six operational modern jack-up rigs, which Keppel will divest to the fund in 2026 for about USD 930 million, according to Offshore Engineer OEDigital. Cash reaching Keppel from that initial six-rig transaction is put at about USD 478 million in 2026.

Apollo Global Management is the anchor investor. Funds, accounts and entities it manages have agreed to put USD 1.5 billion into the vehicle, per the same report.

The accounting treatment cuts the other way in the near term. Keppel said it expects to book a loss of approximately USD 71.3 million on the divestment of the six operational rigs in its first-half 2026 results, including the recycling of foreign currency translation losses.

Beyond the jack-ups already in scope, up to four additional uncompleted rigs could be progressively transferred between 2027 and 2028, subject to certain conditions. That staging is what takes the program to the full complement of 10 units.

Keppel chief executive Loh Chin Hua said the transaction marks a further milestone in the company's transformation and establishes a clear pathway for the progressive monetisation of the legacy rigs.

Spot electricity prices in South Australia have twice been pushed above AUD 20,000 per MWh this year by diesel and gas generators, according to RenewEconomy, which reported the spikes hit once during a summer heatwave and again during a June cold snap.

The first episode came during the Australia Day heatwave in January. RenewEconomy reported that demand rose so sharply that the state's fleet of big batteries exhausted itself, after which gas and diesel plant seized control of the market and set prices at up to more than AUD 20,000/MWh.

The pricing episodes sit awkwardly against South Australia's generation profile. Wind and solar supply an average 75% of the state's electricity, according to RenewEconomy. The state is targeting 100% net renewables by the end of 2027.

RenewEconomy frames the spikes as a black mark against the renewables build-out, with the marginal price being set by the smallest and dirtiest units on the system rather than by the technologies that dominate the mix. The June repeat, driven by cold rather than heat, indicates the exposure runs across both demand seasons.