BAKER HUGHES & AAKER SOLUTIONS: SUBSEA ALLIANCE
Oil services firms Baker Hughes and Aker Solutions agreed on Tuesday to form an alliance for their subsea divisions in an attempt to reduce costs as their customers - oil companies around the world - cut back on spending.
Their non-incorporated alliance also follows a similar move by Cameron and Schlumberger, two of the world's biggest subsea players, which teamed up in 2012 to create joint-venture OneSubsea.
The oil and gas sector has experienced a big rise in costs over the past decade as energy companies ramped up capital spending, pushing up costs ranging from labour to equipment.
But now energy firms are having to rein in spending plans because oil prices have levelled out and the International Energy Agency expects them to fall in 2014 and 2015.
The alliance, to be based in Houston, aims to increase recovery rates in deepsea fields and work on a subsea processing plant, an innovative technology that could eventually shift oil and gas production equipment from platforms to the bottom of the sea, saving on costs and increasing recovery.
Aker Solutions shares surged on the agreement and were 4.5 percent higher by 1221 GMT, ahead of a 0.5 percent rise in the European oil and gas index.
The alliance will combine Aker Solutions' strengths in subsea production and processing systems with Baker Hughes' expertise in well completions and artificial-lift technology, the two firms said in a joint statement.
"Deepwater subsea fields have so far been characterised by low recovery rates, and new discoveries in deeper and more hostile environments are making these fields even more costly to develop," Baker Hughes' CEO Martin Craighead said.
"The single-digit recovery rates currently being achieved at many of these fields don't support a sustainable business model," he said.
Although the two firms will stay separate, they will work on joint solutions and may bid for projects jointly.
|December, 13, 12:40:00|
|December, 13, 12:35:00|
|December, 13, 12:30:00|
|December, 13, 12:25:00|
|December, 13, 12:20:00|
|December, 13, 12:15:00|
PENNENERGY - Germany's Siemens says it has signed contracts worth some 700 million euros ($824 million) to build two gas-powered electricity plants in Libya.
WNN - Construction of the Iter fusion reactor, being built at Cadarache in the south of France, is now 50% complete, the Iter Organisation has announced. The reactor - construction of which began in 2010 - is scheduled to achieve first plasma in 2025.
REUTERS - U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $57.14 a barrel at 0418 GMT, down 22 cents, or 0.4 percent, from their last settlement. Brent crude futures LCOc1, the international benchmark for oil prices, were down 25 cents, or 0.4 percent, at $63.15 a barrel.
PLATTS - Taking into account the nominated volume for Friday, Gazprom will have exported 179.8 Bcm to what it calls the Far Abroad -- Europe and Turkey, but not the countries of the former Soviet Union -- higher than last year's then record high of 179.3 Bcm.