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North Sea contracts boost firms amid downturn triggered by oil price plunge

North Sea contracts boost firms amid downturn triggered by oil price plunge

 

Oill and gas engineering firm Plexus Holdings has won a North Sea contract that will provide a boost amid the downturn in the sector triggered by the coronavirus crisis.

Aberdeen-based Plexus has been engaged by Spirit Energy to provide a wellhead system for use in its gas production operations.

The value of the contract was not disclosed.

However, Plexus said it covered the first major order the company has won since the start of the Covid-19 coronavirus pandemic.

 The spread of the virus around the world resulted in a sharp fall in oil and gas prices, in response to which a range of firms have announced plans to slash spending in the North Sea.

The chief executive of Plexus Holdings, Ben Van Bilderbeeek, said the contract win was notable given the ongoing pandemic and the continued volatility in global oil and gas markets.

Plexus faced challenges during the downturn in the North Sea that followed the sharp fall in the oil price between 2014 and 2016.

 The company sold the division that generated the bulk of its revenues to TechnipFMC in 2018 for up to £42.5m. The division supplies equipment used on exploration wells.

Plexus is now focused on supplying technology for use in other markets such as oil and gas production.

Spirit Energy is majority-owned by Centrica, which puts its stake in the firm up for sale last year.

Separately, oil services giant Petrofac said it had won a contract to manage 25 North Sea production wells for NEO Energy.

The value was not disclosed. Petrofac said the award would allow it to double the size of its UK well portfolio to 50.

In May Petrofac said it aimed to cut running costs by $125m this year, under an initiative it was thought put around 200 jobs in Scotland under threat.

NEO Energy recently renegotiated the terms of a deal to buy North Sea assets from Total.

Source: The Herald

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Published: 30-07-2020

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