Petrofac Regulatory News (PFC)

29 Aug 2008 07:00



PETROFAC LIMITED

PETROFAC ACQUIRES PRODUCTION TECHNOLOGY SPECIALIST

Petrofac, the international oil & gas facilities service provider, announces that it has acquired Caltec Limited (Caltec) for an initial consideration of £15 million, payable in cash, subject to adjustment for surplus cash as at completion. Further consideration of, in aggregate, up to £15 million will be payable in cash and/or shares over the next five years, subject to the achievement of certain agreed performance targets.

Caltec, majority-owned by its management and employees, is a specialist production technology company with products aimed at the enhancement of production from mature fields. These include the Wellcom system which boosts production flowrates by lowering wellhead pressures, and the I-SEP system which allows the partial separation of gas, oil, water and solids. In combination, these systems are capable of significant production, recovery and longevity improvements to mature fields.

Petrofac's Operations Services division, in addition to the efficient and effective operation of production facilities, also seeks to identify and implement appropriate engineered improvements that enhance customers' production, including the use of new technologies. Through the acquisition of Caltec, Petrofac is now able to offer production boosting and partial separation as further tools in its production enhancement capability. These technologies will allow significant production, reserves and field life improvements to be made and, through the planned extension of the technologies, access to difficult, marginal oil & gas reserves.

Based in Cranfield, UK, Caltec has a longstanding association with Cranfield University and, with another office in Aberdeen, UK, Caltec has 18 employees.

Gordon East, managing director of Petrofac Facilities Management commented: "Caltec has developed innovative production enhancement technologies, which will further develop Petrofac's capability in this area. It has an excellent reputation and team and we look forward to jointly developing further capability in this area to continue to add significant value to our customers."

Dave Turley, managing director of Caltec commented: "We are really pleased to be joining Petrofac at this particular point in our development. As part of a larger organisation with numerous ongoing contracts, we believe we can very quickly demonstrate the benefit of our unique production boosting systems and inline process technology for customers operating within mature basins."

Ends

For further information contact:

Petrofac Limited +44 (0) 207 811 4900

Keith Roberts, Chief Financial Officer

Jonathan Low, Head of Investor Relations

Bell Pottinger Corporate & Financial +44 (0) 207 861 3232

Charles Cook

Olly Scott

Notes to Editors

Petrofac

Petrofac is a leading international provider of facilities solutions to the oil & gas production and processing industry, with a diverse customer portfolio including many of the world's leading integrated, independent and national oil & gas companies. Petrofac is quoted on the London Stock Exchange (symbol: PFC) and is a constituent of the FTSE 100 Index.

Through its three divisions, Engineering & Construction, Operations Services and Energy Developments, Petrofac designs and builds oil & gas facilities; operates, maintains or manages facilities and trains personnel; and, where return criteria are met and service revenue synergies identified, co-invests with clients and partners. Petrofac's range of services allows it to help meet its customers' needs across the life cycle of oil & gas assets.

With more than 10,000 employees, Petrofac operates out of four strategically located international centres, in Aberdeen, Sharjah, Woking and Mumbai and a further 20 offices worldwide. The predominant focus of Petrofac's business is on the UK Continental Shelf (UKCS), Africa, the Middle East, the Commonwealth of Independent States (CIS) and the Asia Pacific region.

For additional information, please refer to the Petrofac website at www.petrofac.com.

Caltec

Established in 2003, Caltec designs, develops and supplies multiphase boosting and separation technologies. By harnessing energy from existing sources (such as high pressure wells) the technology has the capability to improve production rates, access additional reserves and enhance ultimate recovery of hydrocarbons across multiple field production scenarios.

Caltec's technology can be split into two main areas:

Wellcom boosting technology

The Wellcom boosting technology increases production by eliminating the back pressure effect on low pressure wells. The technology harnesses energy from high pressure wells or other available sources to drive product flow from low pressure wells in the same production system. Traditionally, multiphase flow from different wells is manifolded by choking the high pressure wells or restricting the low pressure wells to match production pressures over the deployment; a practice that reduces production flow rates. Wellcom is a cost effective boosting system designed to meet production pressure requirements whilst allowing wellhead pressure to be reduced, thus increasing production and ultimate recovery. 

The key applications for the Wellcom boosting technology are:

* boosting low pressure wells without adversely impacting high pressure system

* recovery of low pressure gas/oil

* flared gas recovery

* export gas boosting

* low pressure gas boost from separators

* well start-up, sustaining well life and dead well kick start

* de-bottle necking main compression stations

I-SEP technology

Caltec's I-SEP separator is a compact in-line separator that is extremely effective at separating multiphase fluids. The I-SEP operates by creating high centrifugal forces that generate a low pressure vortex enabling denser fluids to be separated from the flow. This low pressure vortex is created solely as a result of the cyclonic actions of the I-SEP internal design and does not need to be maintained by external equipment. If separation of more than two phases is required, for example gas, liquid and sand, two units operating in-line can be used. 

The key applications for the I-SEP technology are:

* primary gas/liquid separation

* primary gas/oil separation

* partial oil/water separation

* solid separation

* knock out of liquids from wet gas

* smoothes out "slugging" in flow

* liquid recirculation for multiphase pump applications

* under balanced drilling applications

* de-bottlenecking of production facilities

With patented products and solutions, Caltec has a successful, proven record in adding value to major oil companies world-wide with clients including BP, Shell, Conoco, Total and Chevron.

For additional information, please refer to the Caltec website at www.caltec.com.