Petrofac’s EPS business offsetting ‘challenging’ North Sea market

Petrofac CEO Ayman Asfari
Photograph of Ayman Asfari, Petrofac Group's CEO. Picture PR Handout.

Petrofac has said its resilient engineering and production business is offsetting a “challenging North Sea market”.

The energy services giant has issued a trading update ahead of its full-year results in February, stating it is “on course to report good results”.

A total of £950.4m of contract awards have been secured so far this year for the engineering and production services business (EPS), primarily in the UK, Oman, Turkey and Iraq.

The firm said in a statement that the “continued resilience of our operations business, short-term extensions of historical contracts” in the business was “offsetting a challenging market environment for brownfield projects in the North Sea.”

Meanwhile, the engineering and construction business is currently bidding on £11.8billion of tenders scheduled to be awarded in the first half of 2019.

Across all its services, Petrofac said its orders for the year to date totalled £3.9billion.

Chief executive Ayman Asfari said: “We are on course to report good results, which reflect solid operational performance in all our businesses and excellent progress delivering our strategy.

“Healthy new order intake in both our core and growth markets reflects our competitiveness in a market that has seen some delays in contract awards. We have also made excellent progress transitioning back to a capital light business with US$0.8 billion (£600m) of divestments of non-core assets, realising US$0.5 billion (£395.9m) of net divestment proceeds to date.

“Looking forward, we remain focused on securing new orders, delivering operational excellence and maintaining a strong balance sheet. We are well-positioned with a differentiated offering, good backlog and revenue visibility, and high levels of tendering for award in 2019.”

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