Viking Offshore & Marine has joined forces with Chan Kwan Bian to construct a drilling jack-up rig at a cost of about $180m.
The latest partnership will allow the company to venture into the mainstream offshore rig-building and rig charter market.
Designed for use in water depth up to 375ft, the cantilever drilling jack-up CJ46-X100-D GustoMSC rig can accommodate 120 men during operation.
Viking Asset Management (VAM), Viking’s newly setup investment holding subsidiary, has entered into a conditional sale and purchase agreement to acquire a 30% stake worth $5.4m in Smart Earl Investment (SEI) that will build the rig.
Cash proceeds from the rights-cum-warrants issue completed in May 2013 will be used to fund the purchase partly.
SEI is an investment vehicle belonging to Chan. China Merchant Heavy Industries, a state-owned Chinese yard, will build the drilling rig.
Viking executive director Daniel Lin said the contractual terms extended to SEI and Viking will enable the company to build and co-own a jack-up rig without straining its funding ability.
"Through this investment, Viking has initiated its move into the mainstream offshore and marine business, in line with the asset-based strategic growth initiative it had planned for," Lin added.
The contract to build the jack-up rig is expected to complete within 26 months and will allow Viking to participate in providing the complementary equipment and engineering services to the rig construction.
The rig will be resold or chartered to prospective Viking customers in the South East Asia region.
Image: The cantilever drilling jack-up CJ46-X100-D GustoMSC rig has been designed for use in depths up to 375ft. Photo courtesy of suwatpo / FreeDigitalPhotos.net.