Offshore oilfield equipment maker FMC Technologies (FTI) has entered into a supply contract with Norwegian oil giant Statoil ASA (STO). The deal, valued at approximately $70 million, offers FMC Technologies the scope to manufacture and supply the first standardized workover system to the latter.
The system will be utilized to perform intervention activities on subsea wells, intended to boost performance and enhance oil recovery in one of the largest discoveries in the Norwegian sector of North Sea, the Statfjord field. At the peak production level, the field delivers over 700,000 barrels of oil per day.
This happens to be the second contract awarded by Statoil to FMC Technologies in the last five months. In January 2011, FMC Technologies received a contract to deliver two subsea production trees, one manifold and associated subsea and topside control systems to the Statoil for the development of its Gygrid offshore field.
We believe that the strategic alliance between the two companies is strengthening with every deal that is being signed. Statoil exhibits a lot of confidence in the manufacturing expertise of FMC Technologies and stands to benefit from these agreements as they will eventually enhance production capability and trim operating costs.
Houston, Texas-based FMC Technologies is a leading manufacturer and supplier of technology solutions for the energy industry and operates 25 manufacturing facilities in 15 countries.
Statoil, on the other hand, is a major international integrated oil and gas firm, with deep focus on the Norwegian Continental Shelf. As of year-end 2010, the company had approximately 5.33 billion oil-equivalent barrels in proved reserves.
Both companies currently hold a Zacks #3 Rank, which translates into short-term a Hold rating.
FMC TECH INC (FTI): Free Stock Analysis Report
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