A £260 million-plus partnership deal between two leading UK North Sea players is expected to protect hundreds of jobs in Aberdeen and offshore.
Shares in Aberdeen engineering and consultancy services group Wood sprinted ahead nearly 3% earlier today after it announced the five-year tie-up.
Wood said the “master services agreement” (MSA) and associated contracts for Harbour Energy, the region’s biggest oil and gas producer, would pave the way for new jobs in 2024. It did not say how many.
‘Critical assets’
Wood will provide engineering, procurement and construction (EPC), and operations and maintenance (O&M) services, including digital and decarbonisation solutions, for “a number of Harbour’s offshore assets critical to UK energy security”.
The partnership will run for an initial term of five years, with five one-year extension options also covering Harbour-operated assets including its J-Area, Greater Britannia Area, Solan and AELE (Armada, Everest, Lomond and Erskine) North Sea production hubs.
Wood says new partnership will deliver energy mix the UK ‘needs’
Steve Nicol, executive president of operations, Wood, said: “We are incredibly proud to have been selected and trusted by Harbour Energy to partner with them across their North Sea assets. We share a commitment to ensuring safe, reliable and sustainable energy production.”
Wood’sdigital technology and “world-leading” engineering, operations and decarbonisation expertise will help Harbour maximise its investment and “ensure the UK continues to have the energy mix it needs”, Mr Nicol added.
He continued: “We have worked on North Sea assets for more than 50 years and excel in designing and managing the complexity of energy infrastructure, while at the same time seeking to minimise associated emissions.
“This new agreement and new contracts are testament to Wood’s role as a trusted technical partner to the energy companies of the future, where our priority is to help our clients deliver the energy the world needs and be able to transition to a low carbon future.”
⭐ Wood and @Harbourenergy, the UK’s largest oil and gas producer, have entered into a new strategic partnership for UK North Sea operations agreeing a new master services agreement and associated contracts valued at around $330 million.⭐ Find out more ➡ https://t.co/MeLP3vFjQf pic.twitter.com/EJFdWMEfTs
— Wood (@Woodplc) September 4, 2023
Audrey Stewart, vice-president, supply chain, Harbour, hailed the MSA and associated contracts with Wood as “an important step forward in establishing our suite of long-term strategic partnerships across our North Sea assets”
Wood supplies consulting, projects and operations expertise in 60 countries, employing more than 35,000 people globally. About 4,500 of the total work in or from Aberdeen.
£4.6bn order book
Revenue surged nearly 4% to more than £4.4 billion last year as London-listed Wood tackled previous underperformance issues “head-on ” and launched “a new chapter for the group”. Sales during the first half of 2023 were up 18% year-on-year, at £2.2bn.
As of June 30, Wood’s order book was worth about £4.6bn – up 3% from last year on a constant currency basis.
Shares in the FTSE 250-listed firm jumped 2.6% in early trading, to £1.59. By market close they were worth 156.5p.
Conversation