Aberdeen drilling tech firm Plexus strikes deal for new gas well in North Sea

Drilling technology firm Plexus Holdings has struck a contract deal with a major North Sea player to supply equipment for a new gas well.

The agreement comes just days after the Aberdeen-based firm announced an extension of a licence agreement with Cameron, a Schlumberger Group company.

Under the latest deal, Plexus will supply its Pos-Grip surface production wellhead system that is aimed at preventing gas leaks on drilling operations.

Preventing and tackling harmful methane leaks are a growing focus for the oil and gas industry as it comes under growing pressure to reduce its carbon footprint.

Preventing and tackling methane leaks is a key focus for the oil and gas industry as it is urged to cut its environmental footprint. Picture: AFP via Getty Images.

Plexus said the deal, with an unnamed operator, will see it receive milestone payments from the contract signing through to project completion, with the wellhead equipment scheduled for delivery in the second quarter of next year.

The anticipated contract length is 120 days, with the majority of associated revenues expected to be booked in the current financial year.

Plexus chief executive Ben Van Bilderbeek said securing the order was particularly pleasing against the current challenging backdrop including the ongoing Covid-19 pandemic and the continued volatility in global oil and gas markets.

"Following our recent cooperation agreement with Cameron in relation to the supply of jack-up exploration wellheads, this latest order shows we in addition continue to progress our strategy of direct sales in the surface production wellhead marketplace,” he said.

"With a growing pipeline of opportunities, we are hopeful that this latest order will prove to be a bellwether, as we start to emerge from the global pandemic-induced malaise that has impacted our industry.

“Importantly, this production well order is for gas, and as the cleanest hydrocarbon to combust in terms of [carbon dioxide] emissions, natural gas is increasingly viewed as a key transitional fuel, as the world moves towards net zero emissions, and operators strive to deliver on [environmental, social, and governance] commitments.”

Analyst Ian McInally at house broker Cenkos said that with gas prices looking set to remain higher throughout 2022 and into 2023, he believes Plexus is “very well placed” to win further business.

Plexus’ equipment has now been used across more than 400 wells worldwide and the company has worked with many of the leading oil and gas players.

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