Plexus Regulatory News (POS)

Plexus Holdings PLC / Index: AIM / Epic: POS / Sector: Oil equipment & services

14 July 2015

Plexus Holdings PLC ('Plexus' or 'the Company')

Local PETRONAS Licence Secured by Plexus' Malaysian Joint Venture Company

Plexus Holdings PLC, the AIM quoted oil and gas engineering services business and owner of the proprietary POS-GRIP® friction-grip method of wellhead engineering, is pleased to announce that Plexus Products (Asia) Sdn Bhd ('PPA'), the Company's joint venture ('JV') with Integrated Petroleum Services Sdn Bhd ('IPS'), has secured a local PETRONAS licence to manufacture and supply Plexus' POS-GRIP wellhead equipment in Malaysia.

IPS is a well renowned upstream support services business to the offshore oil and gas industry in Malaysia and the Asian Pacific region with in-house manufacturing capabilities and is a licensed vendor to PETRONAS. The formation of the JV was previously announced by Plexus on 13 August 2014. With this important licence obtained, PPA will benefit from the strong manufacturing, regional network and relationships of IPS as it looks to manufacture and supply Plexus POS-GRIP rental exploration and production wellhead equipment to the Malaysian market.

The Plexus Board believes that with the PETRONAS licence secured, PPA will augment Plexus' Singaporean regional HQ and services base and Plexus' recent licencing agreement with Chinese major Yantai Jereh Oilfield Services Group Co., Ltd, as it looks to expand the supply of its best in class POS-GRIP wellhead equipment in new regions such as Malaysia and Asia which offer significant growth opportunities for Plexus.

Plexus CEO Ben Van Bilderbeek said, "We are delighted to announce that our JV company PPA has been successful in obtaining a local PETRONAS licence to manufacture and supply Plexus' POS-GRIP wellhead technology into the Malaysian market. With our partner IPS being an existing licensed vendor to PETRONAS this adds significant weight to this new development, as we look to become a pivotal supplier of wellhead equipment in the region.

"Ultimately it is Plexus' vision to repeat the success we've enjoyed from our main service base in Aberdeen in the Scottish and Norwegian North Sea and EMEA markets and to build a significant Asian presence and distribution channels from which to increase our global reach.

"With the latest flurry of news flow, this is truly an exciting period for Plexus. We anticipate that this will lead to many more supply opportunities in this important market. In tandem with expanding our geographic presence for the supply of our best in class POS-GRIP wellhead solutions predominantly in our organic jack up exploration arena, we are also committed to extending our offering through new innovative product development in the surface production and subsea arenas. One such initiative is our new and safer Python™ subsea wellhead, addressing key technical issues as highlighted by regulators following the Gulf of Mexico incident in April 2010. We have developed this alongside other international oil and gas majors and are launching the product in Aberdeen at Europe's biggest Oil and Gas trade show, SPE Offshore Europe, in September 2015. We look forward to updating the market on these and further developments as we look to broaden our Company offering and increase shareholder value."

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Plexus Holdings PLC

Plexus Holdings PLC, which began trading on AIM in December 2005, is an oil and gas engineering and services business, which supplies wellhead and mudline suspension equipment together with associated equipment and services for exploration and production applications. Based in Aberdeen, with offices in London, Cairo, Kuala Lumpur, Singapore and a presence in Houston, Texas, it has developed and patented a friction-grip method of engineering for oil and gas field wellheads and connectors, POS-GRIP®, which involves deforming one tubular member against another to effect gripping and sealing.

The Company plans to accelerate the roll out of POS-GRIP wellhead equipment as a superior alternative to current technology and for it to become the future industry standard for wellhead design. In particular, the technology has advantages in High Pressure/High Temperature (HP/HT) and Extreme HP/HT (X-HP/HT) oil and gas environments, for which there is growing global demand and where Plexus is being increasingly recognised as the supplier of choice.

To date, POS-GRIP wellhead systems have been used or selected to be used in over 350 oil and gas wells by international companies including ADTI, AGR, Apache Energy Australia, BHP Billiton, BG International, BP, Brunei Shell Petroleum, Cairn Energy, Centrica, ConocoPhillips, Dana Petroleum, Dubai Petroleum, ENI, GDF SUEZ, Global Santa Fe, Maersk, Niko Resources, Petro-Canada Trinidad & Tobago, Premier Oil Norge, Red Sea Petroleum Operating Company, Repsol, RWE, Senergy Limited, Shell China, Shell Egypt, Statoil, Silverstone Energy, Talisman Energy, Total, Tullow Oil, and Wintershall.

Importantly, the Company is focussed on extending its proprietary POS-GRIP technology into an increasing number of subsea applications. In line with this, in March 2011 the Company launched a Joint Industry Project ('JIP') initiative to develop a new subsea wellhead design, the 'Python Subsea Wellhead' utilising its friction-grip technology in collaboration with key oil and gas operators and service companies. BG, Royal Dutch Shell, Wintershall, Maersk, TOTAL, Tullow Oil, ENI, Senergy, ADTI and Oil States Industries Inc. The JIP is nearing completion with final qualification testing of all key features of the product under way, and the resultant Python Subsea Wellhead design will include a combination of key features never before seen in a subsea wellhead which include being rated to 15,000 psi, 4,000,000 pounds of 'instant' casing lockdown capacity, and importantly rigid metal annular seal technology qualified to match the performance of premium connectors. The building of a single string Python Subsea Wellhead system prototype commenced in February, and will be ready for display at the SPE Offshore Europe Exhibition and Conference in Aberdeen ('OE2015') in September.

Plexus is an innovative technology company always looking for opportunities to apply its proprietary POS-GRIP friction grip method of engineering to new products both within and outside the oil and gas industry. For example Plexus have recently completed a JIP in conjunction with Maersk to develop a downhole HPHT Tieback connector which for the first time allows the reconnection of production casing to HPHT exploration and production wells. In addition the Company has developed and qualified a new product called "POS-SET Connector™ which is designed to re-establish a connection onto rough conductor casing previously cut above the seabed to facilitate tieback or abandonment operations. The market for permanent plugging and abandonment of wells is increasing in the North Sea and beyond, and could be an important new revenue stream for the company.