Statoil Awards Twin ISO Services Contract For NCS Installations
Zacks Investment Research | Oct 09, 2017 02:20AM ET
Norwegian oil giant Statoil (OL:STL) ASA (NYSE:STO) has awarded twin contracts for ISO services (insulation, scaffolding and surface treatment) for the Norwegian continental shelf (NCS). However, the services may be used across all facilities on the NCS and onshore in Norway.
The renegotiated framework agreements have been awarded to Bilfinger Industrier Norge AS and Kaefer Energy AS and are worth more than NOK 7 billion. The contracts are expected to terminate at the end of 2030.
Since 2010 renegotiated framework agreements have been inked for the ISO services on the installations, where Bilfinger and Kaefer have played a big role throughout. Draupner, however, is an exception, where supplier change offers flexible utilization of resources across Sleipner Multifield.
Earlier Statoil inked framework agreements with Beerenberg Corp AS and Prezioso Linjebygg AS for other installations on the NCS and onshore plants in 2016. Currently, the company covered its requirements for ISO services at facilities operational until 2030.
The agreements boost innovation and technology development within the ISO services carried out at Statoil facilities. This comprises further enhancement of specialist skills and higher proportion of apprenticeship certificates.
Per the agreement, Bilfinger will cover Snorre A/B, Sleipner A/B/R/T, Gudrun, Gina Krog, Draupner, Oseberg Feltsenter and Veslefrikk. Kaefer Energy is accountable for Troll A/B/C, Asgard A/B and Kristin. The other installations on the NCS will continue with their current ISO contracts.
About Statoil
Statoil’s endeavor to improve recovery of resources in mature fields is commendable. The company has operations in all major hydrocarbon-producing regions of the world, with an emphasis on the NCS. Shares of the company have returned 15% compared with the industry ’s increase of 4.2% over the last six months. However, the company’s high leverage is a cause of concern.
Zacks Rank & Key Picks
Currently, Statoil carries a Zacks Rank #3 (Hold). A few better-ranked players in the energy sector include First Solar Inc (NASDAQ:FSLR) , Lonestar Resources US Inc (NASDAQ:LONE) and Alliance Resources Partners, LP (NASDAQ:ARLP) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see Zacks Investment Research
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