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Plexus Holdings awarded production wellhead contract

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Oilfield Technology,

Plexus Holdings has been awarded a purchase order for a POS-GRIP surface production wellhead system from Spirit Energy.

The order from Spirit Energy includes Plexus’ POS-GRIP 5000 psi leak proof “HG” metal to metal sealing surface production wellhead and associated spares and equipment for a new gas well in the UK North Sea. Under the terms of the contract, Plexus will receive milestone payments following the date of the signing of the purchase order through to completion. The wellhead is scheduled for delivery to Spirit Energy in February 2021. The contract is expected to have a duration of approximately 120 days, with most of the revenues to be booked during the company’s 2020/21 financial year.

This is the second purchase order for a surface production wellhead that Plexus has been awarded by Spirit Energy, which was previously known as Centrica North Sea Limited. Significantly it is Plexus’ first major order since the COVID-19 pandemic struck and is a good indicator of the operations that Plexus has managed to maintain during this time.

The purchase order is in line with the company’s IP-led strategy to extend the application of its POS-GRIP technology beyond jack-up exploration, where it has been used on over 400 wells worldwide, into higher value areas of the energy sector, including oil and gas production, geothermal and other applications.

Plexus’ CEO Ben Van Bilderbeek said: “Securing an order for POS-GRIP wellheads in the current climate is positive, particularly when one considers the long lead times associated with the award of such contracts, the ongoing COVID-19 pandemic and the continued volatility in global oil and gas markets. For years, POS-GRIP wellheads have not only delivered a superior sealing solution but also one that is cost-effective and maintenance free. Our equipment has proven to be superior in terms of TOTEX performance, reliability, and safety over many years out in the field. In addition, our technology has generated considerable operational cost savings via reduced installation times and reduced non-producing time, by not having to shut down production to carry out maintenance.

“This order is for a gas production well, and as the cleanest hydrocarbon to combust in terms of CO2 emissions, natural gas is increasingly viewed as a key transitional fuel, as the world moves towards net zero emissions. A key assumption behind this view is that harmful fugitive methane emissions can and must be eradicated from the entirety of the natural gas consumption chain. At the well-site, POS-GRIP's leak-proof wellheads can do that and as a result, we believe our production technology delivers a compelling economic and environmental proposition for the surface production operations we are targeting. With a substantial pipeline of opportunities, we are hopeful that today’s order from Spirit Energy will prove to be a bellwether, as the oil and gas industry begins to emerge from the global COVID-19 pandemic-induced malaise.”

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