(Sharecast News) - Industrial services and rental company Northbridge Industrial Services announced on Wednesday that the five joint tender contracts originally awarded to its subsidiary Tasman's joint venture partner in Malaysia, Olio Resources, have been extended for a further two years on improved terms.
The AIM-traded firm said the original contracts were awarded to Olio for a three year term in November 2016, at the depth of the downturn in the oil and gas market.
It said the joint venture between Olio and Tasman started at the beginning of 2018, with Tasman and its subsidiaries Tasman South East Asia, based in Malaysia, and Tasman Asia Pacific, based in Singapore, supporting the joint venture in the supply of drilling tools and services to Petronas and its partners in the region.
"The improvement in terms relate to inspection and repair services which are offered alongside the rental of oil tools to the joint tender partners, who include five of the top international oil and gas operators in the region," the board said in its statement.
"Whilst the joint venture is currently loss making, this extension with revised terms coupled with improving revenues, will make a substantial contribution to reducing the deficit in the 2020 financial year and, if revenue continues to improve as expected, to generating profits for Northbridge from the 2021 financial year.
"Other businesses within the Group continue to make good progress and the board is confident that Northbridge is in line to meet current management expectations."
At 0823 GMT, shares in Northbridge Industrial Services were up 5.06% at 121.35p.
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