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Plexus Holdings highlights POS-GRIP rental deal with Gasprom

Published: 19:05 04 Mar 2019 AEDT

oil and gas operations
Plexus will receive a share of the invoice value

Plexus Holdings PLC (LON:POS) told investors that its Russian licensee has secured its first major contract to supply the proprietary POS-GRIP  wellhead gas exploration equipment to Gazprom.

The contract, secured by licensee Gusar, covers the first of a possible five-year arrangement for programmes on the Kara Sea Shelf, where there are shallow water depths of less than 150 metres.

Under the product license with Gusar, Plexus is entitled to 20% of the invoice value to Gazprom though, following a recent additional royalty agreement it is also entitled to a further 20% share.

READ: Plexus shareholders back buyback deal with Russian partner Gusar

Plexus described today’s news as “a significant milestone” as it advances its strategy to establish the POS-GRIP technology as ‘best in class’ across Russia and the CIS.

"This is the breakthrough rental wellhead order that both Gusar and Plexus have been working towards since we signed the licensing agreement in January 2016,” said Ben Van Bilderbeek, Plexus chief executive.

“As the holder of the world's largest natural gas reserves, Gazprom is the latest major operator set to join the likes of BP, Centrica, ConocoPhillips, eni, Royal Dutch Shell, and Total on the long list of operators that have used our proprietary POS-GRIP technology around the world. 

“We are therefore anticipating that today's order will prove to be the first of many, not just for Gazprom, but in time from other companies operating in the CIS market.”

"This initial contract between Gusar and Gazprom will provide us with our first Gusar licence royalty revenue stream.”

He added: “Together with our cash-rich balance sheet and the remaining earn-out period and collaboration agreement with TFMC for existing and new POS-GRIP IP applications outside of jack-up exploration, we are strongly placed to advance our objective of establishing POS-GRIP as the enabling gas-proof technology for the wider energy sector including production and subsea applications, and decommissioning and renewables markets."

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