Lime Rock Partners to Fund PSL Acquisition of Dolphin Well Services7/11/2003
ABERDEEN, UK, July 11, 2003 – A North-east energy-services firm, bought out of receivership earlier this year, yesterday showed it was going from strength to strength, after unveiling plans for an £8million acquisition. PSL Energy Services, based in Portlethen, is set to take over a Norwegian well-services business – in a move that will boost its workforce by more than 50.
The company said it was in final negotiations to buy Dolphin Well Services (DWS), a subsidiary of Fred Olsen Energy ASA, for £8.3million.
DWS provides hydraulic work-over units and under- balanced drilling to oil and gas companies operating in the North Sea.
The acquisition includes all of DWS’s assets, including seven work-over units and ancillary oil-service equipment.
The company’s onshore base in Aberdeen – which employs around 10 onshore staff and around 40 offshore workers operating out of the Granite City – will be integrated into PSL’s headquarters on Badentoy Industrial Estate.
DWS’s Stavanger operation will continue to trade in the Norwegian city, but will be rebranded under the PSL name.
Almost all producing wells become less efficient in time, due to mechanical problems within the well or depletion of oil and gas reservoirs.
Work-over is any operation within a well bore to repair malfunctioning equipment or rid a well of any condition that prohibits efficient production.
PSL managing director Doug Duguid said yesterday there was a growing demand for work-over units from new independents entering the North Sea who were looking for more cost-effective ways of completing heavy well work-overs and near-well-bore side tracks.
He added: “We have a good reputation for service, quality and innovation and this acquisition allows us to provide an integrated service, which in turn allows us to deliver added value to the customer.”
The managing director added: “The technology and safety record of work-over units has been enhanced greatly in recent years and we believe there are opportunities for PSL to satisfy demand for this service in continental Europe and North Africa.”
Lawrence Ross, managing director of Lime Rock Partners, which owns a majority interest in PSL and has guaranteed the funding for the acquisition, added: “This transaction is typical of Lime Rock’s support for its investments.”
“Lime Rock Partners found this deal and brought it to PSL where the management team, in which we have great confidence, agreed that it was an excellent fit with the development and growth plans for the company.”
PSL Energy Services employs 190 staff at its North-east HQ and at bases in Great Yarmouth, Houston, Singapore and Baku.
The company – which specialises in well services, process, pipeline, excavation and inspection services – was formed following a £14million management buyout from PSL Holdings in April.
PSL Holdings went into receivership in March owing £18million each to the Royal Bank of Scotland and Bank of Scotland, as well as an undisclosed sum to other creditors.
However, a team of executives, led by Mr Duguid, bought the business out of receivership.
Mr Duguid said yesterday: “Following our management buyout in April, funded by Lime Rock and Bank of Scotland, we have enjoyed trading which exceeded our forecasts and this acquisition is further proof that PSL Energy is going from strength to strength.”
Oil prices stayed firm yesterday, supported by concern about inadequate supplies and the latest signs Opec kingpin Saudi Arabia was sticking to the cartel’s output curbs. In London, benchmark Brent crude gained 17cents weaker at 28.88 a barrel, the highest level since just before the Iraq conflict.
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