4th Mar 2019 10:05
LONDON (Alliance News) - Shares in Plexus Holdings PLC spiked Monday after the oil and gas engineering services company said its Russian licensing partner secured an exploration wellhead equipment contract with Russian giant Gazprom PAO.
Plexus was trading 30% higher mid-morning at 59.00 pence each.
The contract covers the first year of a potential five-year gas exploration drilling programme on the Kara Sea Shelf, in the Arctic Ocean north of Siberia. Plexus said rental rates for the area carry similar rates to the UK Continental Shelf.
Under the terms of a 2016 licence agreement signed with Gusar LLC, Plexus will receive 20% of all Plexus products rented or sold. A recent royalty agreement was signed between Gusar and Plexus giving Plexus a further 20% royalty of invoice values for the contract with Gazprom.
"This is the breakthrough rental wellhead order that both Gusar and Plexus have been working towards since we signed the licensing agreement in January 2016," said Chief Executive Ben Van Bilderbeek.
"We are anticipating that today's order will prove to be the first of many, not just for Gazprom, but in time from other companies operating in the Commonwealth of Independent States market."
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