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Plexus' Russian partner lands supply deal for Gazprom’s arctic wells

Published: 16:29 27 Sep 2018 AEST

oil and gas operations
The kit will be used in an Arctic gas exploration programme next year

Plexus Holdings Plc (LON:POS) told investors that its Russian partner has an initial agreement to supply the company’s equipment to Gazprom.

Licensee Gusevsky Valves Plant LLC (Gusar) will provide to Gazprom two sets of Tersus branded TRT Mudline Suspension Systems (MLS) to be used in shallow water exploration wells in the Russian Arctic, in the Kara Sea. The wells are due to be drilled next year.

Gusar is in the process of localising the manufacturing of the Plexus' MLS, under license, in Russia, and the transaction value is described as being similar to those achieved for the product in the UK Continental Shelf.

READ: Plexus Holdings ready to help tackle gas industry’s methane problem

Plexus said it was the “first breakthrough order” in the Russia and CIS market.

"Following today's announcement, Plexus' MLS equipment will soon be deployed in the huge Russian market which, due to the level of upcoming gas drilling activity, represents a major commercial opportunity for Plexus, and its licensee Gusar,” said Ben Van Bilderbeek, Plexus chief executive.

“Furthermore, with gas being targeted in the current shallow water campaign, it is clearly imperative that the best equipment is deployed to ensure drilling operations are completed safely and that gas leaks are avoided.”

He added: "The CIS is a key target market for Plexus.

“This is not just down to the vast volumes of hydrocarbon reserves it holds and the importance of gas within the country's energy mix, but also because the CIS provides a readymade example of the licensing model that lies at the centre of our strategy post the sale of our jack-up exploration business to FMC Technologies Limited (excluding the CIS).”

Ben Van Bilderbeek told investors that there’s scope for Plexus to build a portfolio of licensing agreements with key partners, in specific geographies and for specific products.

Gusar director Alexander Beryozkin, meanwhile, said: “Today's contract follows an extensive period of engagement with Gazprom to demonstrate the advantages of Plexus' technology. 

“We anticipate that this contract to supply mudline suspension systems and exploration drilling equipment to Gazprom will be followed by an order for rental wellhead equipment and related services, which in turn will open up further opportunities for Gusar to participate in Russian offshore gas exploration both with Gazprom and other operators.

"The mudline suspension systems to be manufactured by Gusar according to the licence from Plexus delivers superior well integrity features, ensuring maximum safety and efficiency for offshore gas well construction on the shelf - an important factor for exploration activities in the Arctic conditions."

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