Keppel O&M in talks with Borr Drilling on deferring debt maturities

Keppel Corp.’s Keppel Offshore & Marine is in talks with Borr Drilling on deferring the scheduled delivery and payment of five jackup rigs to 2025 from 2023, but no definitive agreement has been reached, the Singapore-listed rig-builder said Wednesday in a filing to SGX.

That statement followed Borr Drilling saying, in an announcement posted on its website Monday, that it had reached agreements in principle with the Singaporean yards, its largest creditors, to refinance and defer a combined US$1.4 billion in debt maturities and delivery installments to 2025 from 2023.

Borr Drilling had said the agreements with both yards were subject to approvals from the Singapore companies’ boards, which was expected in mid-January. The Norway-based company had said a total of US$1.4 billion was set to be refinanced and deferred.

On Tuesday, Sembcorp Marine said its wholly owned subsidiary PPL Shipyard, or PPLS, reached a deal to defer receivables from Borr Drilling to 2025 from 2023.

Borr Drilling had entered agreements in 2017 to buy nine Pacific Class 400 jackup drilling rigs from PPLS for around US$1.3 billion, making an upfront payment of around US$500 million, the filing said, adding the balance, plus interest, was to be paid within five years of the rigs’ delivery dates, SembMarine said Tuesday.

SembMarine said the balance amount was due on 1 May 2023, and a majority of the interest was due in the first quarter of 2023, but the new agreement would defer the balance by 24 months, to 1 May 2025, while part of the capitalized interest due in the first quarter of 2023 would be paid earlier and Borr Drilling would pay an extension fee.