Marine Log

April 3, 2006

$102 million upgrade for Diamond Offshore semi

Keppel FELS Ltd (Keppel FELS) has won a US$ 102 million contract from Diamond Offshore Drilling, Inc. for the major upgrading of the semisubmersible rig Ocean Monarch.

Ocean Monarch will arrive Keppel FELS in mid 2006 for the upgrading and is expected to be operationally ready in fourth quarter 2008.

After the upgrade, Ocean Monarch will be able to operate in up to 10,000 feet of water in a moored configuration.

It will be among the most modernized and capable of Diamond's fleet of upgraded Victory-class semis.

This semi is the fourth in a series of fifth generation Victory-class upgrades that Keppel FELS has undertaken for Diamond Offshore.

The Ocean Baroness and Ocean Rover upgrades have been completed while Ocean Endeavor is currently undergoing upgrading works at Keppel FELS and is scheduled for completion in fourth quarter 2006.

Keppel FELS is also currently undertaking the construction of one jackup rig for Diamond Offshore. Its sister company, Keppel AmFELS in Brownsville, Texas, is also building a jackup for Diamond. Both rigs are of Keppel's KFELS B Class design.