Oilfield equipment manufacturer FMC Technologies Inc. FTI has entered into a deal with Technip SA, an engineering and construction company.
Per the agreement, both firms will jointly form Forsys Subsea, a new entity in which FMC Technologies and Technip will have a 50% ownership each.
By combining the technology and expertise of the two subsea industry leaders, the joint venture company will be capable of assisting the upstream energy players in efficiently getting their first oil at a minimum cost.
John Gremp − the chairperson, president and chief executive officer of FMC Technologies – revealed that the global market is demanding new sources of crude, generally available at the deepwater. But extracting crude from the ocean bed is quite challenging and most expensive. Hence, the E&P players will not explore those operations until the cost to pump first oil gets reduced considerably.
Consequently, after using Forsys Subsea’s new technology, the upstream players can increase their profits by lowering operating costs in this weak crude pricing environment.
FMC Technologies added that the newly formed company will have its headquarters in London and is expected to have a headcount of 320.
Houston, TX-based FMC Technologies is a leading manufacturer and supplier of technology solutions for the energy industry. The company currently carries a Zacks Rank #3 (Hold), implying that the stock will perform in line with the broader U.S. equity market over the next one to three months.
Better-ranked players in the energy sector include Western Refining, Inc. WNR, Sprague Resources LP SRLP and Western Gas Equity Partners LP WGP. All these players sport a Zacks Rank #1 (Strong Buy).
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