The investment in isol8 will also be used to develop the company’s zero-emissions product portfolio and expand its services into the wellbore construction sector.
The firm, which has received the funds from BGF, formerly the Business Growth Fund, has developed technology that supports the UK government’s ambition to drive down global methane and carbon dioxide emissions.
It is estimated that successful deployment of isol8’s tech could unlock savings of up to £7m for platform and subsea wells abandonments, translating into potential multi-billion-pound savings for North Sea well decommissioning.
Founded in Aberdeen in 2017, the firm’s UK team of seven boasts 170 years of oilfield experience. A research and development team of four is based in Port Townsend in Washington State in the US.
The overall headcount is now expected to grow by five people.
Andrew Loudon, chief executive of isol8, said: “Decommissioning is now a huge focus in the North Sea and we’re partnering with clients to help them significantly reduce their asset retirement costs.
“Now, with the support of BGF, we are in a strong position to broaden our zero-emission product portfolio and accelerate the production of new products.
“The BGF team fully understands and supports our vision, and their expertise and business knowledge will be invaluable as we embark on this next chapter together.”
As part of the transaction, BGF investor Richard Pugh will join the company’s board as an investor director, alongside newly appointed independent director Nigel Avern.
Avern is the former chief executive of Peak Well Systems, nurturing the business from a start-up to an international company with market leading positions in well intervention tooling and bridge plugs.
He led the successful trade sale of Peak to Schlumberger. Formerly, Avern spent 18 years with The Expro Group working in a range of marketing, technical and general management roles.
Pugh, an investor in BGF’s Aberdeen office, said: “Isol8 has huge potential to use its cutting-edge Fusion technology to generate very large savings in plug and abandonment and intervention operations – both of which are markets where we expect long-term growth and where Aberdeen continues to have world-leading expertise.
“At the same time, by ensuring a gas-tight seal, Fusion provides the industry with a much lower emission solution than cement, going some way to address the long-term challenge of de-carbonising the sector.
“This funding round will support an exceptional management team in completing the final push to commercial adoption, working in parallel with a number of operators who have shown real commitment to the technology.”
He added: “We are also delighted that Nigel Avern has joined the board to bring his own experience of building successful energy technology businesses.”
BGF was set up in 2011 and has invested some £2.5 billion in more than 400 companies across the UK. BGF describes itself as a minority, non-controlling equity partner with a patient outlook on investments, based on shared long-term goals with the management teams it backs.