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Tuesday, April 23, 2024

Statoil contracts boost some suppliers’ fortunes

UPDATED: Norwegian oil company Statoil awarded several new contracts on Tuesday, for maintenance and modifications on its offshore oil fields. Among the winning companies was Aibel, which got its contract extended and expanded on the Njord and Aasta Hansteen fields. Among the losers: Aker Solutions, which didn’t win any new work and quickly warned it would need to cut more jobs.

Aibel stated that the contract, worth NOK 7.5 billion and due to take effect March 1, will ensure work for around 1,000 people. That’s welcome news in an industry battered by the dive in oil prices, which have fallen from well over USD 100 a barrel early last year to under USD 40 at present.

Other oil service companies winning sought-after contracts from Statoil include Apply Sørco, Reinertsen and Wood Group Mustang. Aker Solutions failed to secure any of the work, prompting one analyst to tell newspaper Dagens Næringsliv (DN) that the loss was a “crisis” for the company that’s already laid off hundreds of workers.

Aker Solutions later announced that the failure to win any of the Statoil work would cut revenues and force cuts at sites where such maintenance and modification work is performed. Aker Solutions’ current contract with Statoil runs out next summer, and had provided work for around 900 employees both onshore and offshore.

Statoil noted in a press release that the maintenance and modification work will make the company more competitive and stimulate long-term activity and value creation on the oil fields. It comes at a time when debate is flying over the future of Norway’s oil and gas industry as the country needs to conform to the new climate agreement hammered out in Paris over the weekend. Environmentalists claim production of fossil fuels will need to cease, while industry and government officials claim the world still needs natural gas as an alternative to coal. staff



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