Plexus Holdings PLC / Index: AIM / Epic: POS / Sector: Oil Equipment & Services
This announcement contains inside information
Plexus Holdings PLC ('Plexus' or 'the Company')
Joint Venture for the Supply of Plexus "HG"™ Production Wellheads, Surface Xmas Tree and Valve Package
Highlights
· Formation of a joint venture ('JV') to enable Plexus to offer oil and gas operators a full package of extensively field proven and highly qualified Plexus surface xmas trees and valves, together with its POS-GRIP® "HG" production wellhead systems
· The JV, Plexus Pressure Control Limited ('PPC'), will supply Plexus with extensively field-proven, highly qualified surface production xmas trees and wellhead annulus outlet valves
· Plexus, via its wholly owned subsidiary Plexus Ocean Systems Limited, is partnering in the JV with BEL Valves Limited ('BEL Valves') for the supply of the high integrity valves required in surface xmas trees and wellheads
· Plexus will be the majority shareholder of the JV and will control the IP, design and manufacture of PPC's production xmas trees and wellhead annulus valve products
Plexus Holdings PLC, the AIM quoted oil and gas engineering services business and owner of the proprietary POS-GRIP friction-grip method of wellhead engineering, is pleased to announce the formation of PPC, a majority owned JV which will exclusively supply Plexus with surface production xmas trees and wellhead annulus outlet valves. Following the sale last year of its jack-up exploration wellhead rental business to TechnipFMC, the formation of PPC is in line with Plexus' strategy of targeting high-value surface production projects where operators typically purchase wellheads as a package together with a production xmas tree and side outlet valves.
Plexus will supply the JV with its POS-GRIP "HG" Technology and products associated with xmas trees, while BEL Valves will supply the JV with critical valve components and technology. BEL Valves is a leading UK (Newcastle) based valve company with over 45 years of experience in the oil and gas industry, which designs and manufactures valves and actuators, and typically focuses on applications downstream of the wellhead and tree systems. BEL Valves has supplied its critical valve equipment and technology for some of the most challenging high spec applications such as high pressure/high temperature ('HP/HT') and subsea projects. As a result, BEL Valves is ideally placed to support Plexus on the most demanding of wellhead and tree projects.
PPC will be based in Plexus' facility in Dyce, Aberdeen so that all project planning, procurement and product integration work can be delivered seamlessly from a single point to the customer. Although Plexus anticipates that both the "HG" production wellhead and PPC tree will be largely maintenance free, any after-market work will also take place at the same facility.
BEL Valves, part of the British Engines Group, was established in Newcastle-upon-Tyne in 1964 to design and manufacture high pressure and high temperature valves for the petrochemical industry. In the 1970s, BEL Valves established itself as a key global supplier to the oil and gas industry. Today, BEL Valves continues to lead the way in innovative engineering and customer service by pushing industry standards forward in safety, reliability and sustainability. Further information on BEL Valves is available on the company's website www.belvalves.com
Plexus' CEO Ben Van Bilderbeek, said: "The formation of PPC enables Plexus to supply xmas trees as part of a 'package solution' for the first time. It is a key step in our company's evolution and ambition to provide the industry with wellheads and associated products, which are gas tight and methane leak free. With the long-term field history and extensive qualification testing already demonstrated with the tree and valve products which Plexus now has full access to, we are confident that we can now truly provide the complete package to our customer."
BEL Valves' CEO Bruce Heppenstall, said: "Our valves and Plexus' wellhead systems are an excellent fit. Both deliver the highest standards in performance, reliability and safety and both have a proven track record in operating in extreme HP/HT environments. We at BEL Valves are looking forward to working with Plexus to offer operators a complete surface package, which we believe delivers the best solution available by far."
Further Information
Production Wellhead and Xmas Tree Market
Plexus developed the jack-up wellhead rental business without access to or ownership of any gate valve technology, as typically exploration wells do not require a xmas tree. However, production wellheads always require a tree, and in the supply of production "HG" wellheads in the past, Plexus has either partnered with a valve and tree supplier on a project by project basis or sold the wellhead directly to the customer without a tree. Now, as Plexus focuses on the production wellhead market it is increasingly necessary to be able to sell wellheads as a package together with a production xmas tree and side outlet valves. Plexus has therefore committed to establishing PPC with BEL Valves to have access to a premium quality valve product with extensive field history and qualification results.
Further Product Development
As well as supporting Plexus' current production surface wellhead business, it is anticipated that PPC will also be a catalyst to further develop elements of Plexus POS-GRIP technology and other IP which has specific application in valve and xmas tree technology, for both land and offshore surface platform production wells.
**ENDS**
For further information please visit www.posgrip.com or contact:
Ben van Bilderbeek |
Plexus Holdings PLC |
Tel: 020 7795 6890 |
Graham Stevens |
Plexus Holdings PLC |
Tel: 020 7795 6890 |
Derrick Lee |
Cenkos Securities PLC |
Tel: 0131 220 9100 |
Frank Buhagiar |
St Brides Partners Ltd |
Tel: 020 7236 1177 |
Isabel de Salis |
St Brides Partners Ltd |
Tel: 020 7236 1177 |
NOTES:
AIM-traded oil and gas engineering services company Plexus (AIM: POS) is an IP led company that has developed a range of products and applications based on its patent-protected POS-GRIP friction-grip technology. Having proved the superior qualities of POS-GRIP within the jack-up wellhead exploration market through the sale of this business to FMC Technologies Limited, a subsidiary of TechnipFMC (Paris:FTI, NYSE:FTI) (jointly "TFMC"), in early 2018, the company is now focused on establishing its technology and equipment in other markets including surface production wellheads, subsea and de-commissioning.
Its suite of ongoing products and applications include: "HG" wellheads, which combine POS-GRIP technology with gas tight metal sealing; the Python® subsea wellhead (a new standard for subsea wellheads - developed in a Joint Industry Project supported by Royal Dutch Shell, BG (now owned by Shell), Wintershall, Total, Maersk (now owned by Total), Tullow Oil, eni, Senergy (now Lloyds register), and Oil States Industries Inc); the POS-SET™ connector for the growing de-commissioning and abandonment market; and Tersus-PCT, an innovative HP/HT tie back connector product. Importantly, the company also has a collaboration agreement with TFMC, which provides a platform to further develop and commercialise these and other applications based on its POS-GRIP technology.
