April 13 (Bloomberg) -- Keppel Corp., the world’s biggest builder of oil rigs, rose to the highest price in almost a year in Singapore trading after winning a preliminary order worth about $4.12 billion from Sete Brasil Participacoes SA.
The rig-maker advanced 2 percent to close at S$11.46, the highest price since June. It was the third-biggest gainer on the Straits Times Index. Sembcorp Marine Ltd., which also makes oil rigs, climbed 2.7 percent.
Sete Brasil, part-owned by Petroleo Brasileiro SA, signed a letter of intent to buy five semi-submersible rigs, according to a statement from Singapore-based Keppel yesterday. Petrobras is adding rigs as it explores the largest offshore oilfield to be discovered in the Americas since 1976.
“The next three months could be busy with other rig operators placing orders to secure yard slots,” Xin Jin Ling and Praveen K. Choudhary, analysts at Morgan Stanley, wrote in a note today. “Keppel and Sembcorp shares will continue to do well.”
A final agreement for the Sete Brasil rigs, which will be assembled in Brazil, may be signed within two months, Keppel said. The Singapore company is building its second yard in the South American country because of demand. Sembcorp Marine, the world’s second-biggest rig maker, and Hyundai Heavy Industries Co. have also invested in the country.
Sete Brasil said it February it will spend $27 billion by 2020 on drilling units. The company ordered an $809 million semi-submersible rig from Keppel in December and a drill ship from Sembcorp in February.
Demand for offshore units remains “hot” this year, Keppel Chief Executive Officer Choo Chiau Beng said in January, after the company won record orders totaling more than S$10 billion ($8 billion) last year.
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