AGM Statement

RNS Number : 0270K

Plexus Holdings Plc

30 December 2020

 

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

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

AGM Statement

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, known for its safety, time and cost saving capabilities, will hold its Annual General Meeting ('AGM') today.  The AGM is being held as a closed meeting due to the ongoing COVID-19 pandemic.  At the AGM, Graham Stevens, Plexus' Finance Director, will be appointed to act as the Chairman of the meeting and will make the following statement:

"Proven disruptive technology.  Blue-chip customer base.  Exponential market opportunity.  Competitors now partners.  Supportive market narrative.  These five key points would not be out of place in the corporate presentation of a multi-national ground-breaking high-tech company.  In our view, they are just at home in the 2020 AGM Statement of Plexus, the Aberdeen-based owner of POS-GRIP, a friction grip method of engineering which has been deployed on over 400 wells around the world and has raised the bar in terms of wellhead performance, safety and reliability, particularly in relation to gas proof sealing performance.

"Proven disruptive technology: POS-GRIP delivers true and verifiable leak-proof HG® metal-to-metal seals and generates considerable cost savings for operators due to reduced installation and downtime.  How is this disruptive? POS-GRIP involves applying an external force to squeeze a housing until it engages with the components inside (casing or tubing hangers in wellheads), which generates a gripping force that eliminates assembly clearances. This activates the "HG" seals, delivering what is believed to be a lifetime leak-proof metal seal solution. As the process is controlled by hydraulic pressure and occurs within the elastic limits of material, the connection is reversible.  Compare POS-GRIP's simple design with rival systems, which typically comprise a far higher number of individual components.  The higher the number of components, the higher the chance for seal integrity to be compromised and for individual pieces to succumb to fretting/movement caused by temperature and pressure variations.

"Blue-chip customer base: POS-GRIP wellheads have been successfully deployed on hundreds of wells in some of the most challenging operating conditions all around the world by blue-chip operators including Royal Dutch Shell, BP, ENI and Total, many of whom have become long term customers.

"Exponential market opportunity: wherever metal to metal sealing is required, POS-GRIP can deliver a leak-proof solution, and our growing suite of POS-GRIP products reflects this.  For example, the POS-GRIP "HG" Tubing Spool enhances the integrity of existing wells.  Conventional tubing spools are a frequent source of leakage due to having multiple leak paths through tie-down bolts and annular seals which are not adequately qualified. Replacing these with the POS-GRIP tubing spooI not only remediates historic wells but delivers leak-free performance at the "HG" seals for the entire field life, eliminating the requirement for any annual maintenance, which in turn generates substantial savings for operators.  POS-GRIP exploration and production wellheads have been proven to deliver superior performance and cost savings many times over out in the field. POS-GRIP applications for the renewable sector, including geothermal and nuclear also offer unique advantages, and work is ongoing to see how we can access such markets.

"Competitors now partners: simply owning a technology which is proven to deliver a leak-proof solution and generate significant cost savings for operators is, on its own, not enough to ensure POS-GRIP becomes established as the enabling technology for the energy sector we believe it ought to be. Widespread acceptance by the industry is required not just by operators but also by the large services companies that supply them, as they have the global full-service reach that the larger oil and gas operators increasingly require.  Encouragingly, this is beginning to happen.  Today, Plexus has agreements in place with two of the top three oil and gas services providers in the world. In November 2020, we signed an important licence agreement with Cameron International Limited ('Cameron'), a Schlumberger group company, the world's leading oilfield services provider.  The licence grants Cameron a non-exclusive licence to develop conventional and unconventional oil and gas surface wellheads using our technology. This transaction follows on from the sale of our jack-up exploration wellhead rental business to a division of TechnipFMC ('TFMC') in 2018, where we signed a Collaboration Agreement with TFMC to explore the development of new POS-GRIP enabled applications.  Yesterday's competitors we believe can become tomorrow's partners as our proprietary technology begins to gain the recognition that it deserves. 

"Supportive market narrative: the oil and gas industry has to satisfy growing demand for energy while at the same time playing its part in helping the world become carbon neutral as it moves to the goal of 'net zero'.  Natural gas represents the low hanging fruit for operators wishing to cut their carbon footprint due to it being the cleanest fossil fuel in terms of carbon emissions when combusted.  As gas exploration and production grows, so too does scrutiny of operations from activists and investors to ensure that all activity is conducted in line with the highest possible standards to safeguard the environment from harmful emissions.  At the well site, POS-GRIP delivers the highest possible standards. 

"The narrative is increasingly being driven by the need for the world to move to net zero carbon emissions to combat climate change.  In line with this, the energy sector's carbon footprint needs to be reduced towards net-zero targets.  Advanced leak-proof solutions such as POS-GRIP are required throughout the supply chain, all the way from the well site to the consumer.  While the ongoing COVID-19 pandemic may continue to impact energy consumption levels and timings into 2021, we are confident that the best days for Plexus' proprietary technology lie ahead.  Our confidence is based on the combination of the momentum behind the energy transition, the higher level of scrutiny operators are under to avoid and tackle emissions, and the growing pressure to manage costs in the current volatile oil and gas price environment where margins are under pressure.  POS-GRIP delivers on all counts.  With a capital-light licensing model, a debt-free balance sheet and a proven track record, Plexus is well placed to succeed for the benefit of all stakeholders in the energy transition." 

**ENDS**

For further information please visit www.posgrip.com or contact:

Ben van Bilderbeek	Plexus Holdings PLC	Tel: [phone]
Graham Stevens	Plexus Holdings PLC	Tel: [phone]
Derrick Lee	Cenkos Securities PLC	Tel: [phone]
Frank Buhagiar	St Brides Partners Ltd	Tel: [phone]
Isabel de Salis	St Brides Partners Ltd	Tel: [phone]

NOTES:

AIM-traded oil and gas engineering services company Plexus (AIM: POS) is an IP led company that has developed a range of products and applications based on its patent-protected POS-GRIP friction-grip technology.  Having proved the superior qualities of POS-GRIP within the jack-up wellhead exploration market through the sale of this business to FMC Technologies Limited, a subsidiary of TechnipFMC (Paris:FTI, NYSE:FTI) (jointly "TFMC"), in early 2018, the Company is now focused on establishing its technology and equipment in other markets including surface production wellheads, subsea and de-commissioning, both organically and through licence partners.  In line with this, in November 2020 Plexus entered into a licence agreement with Cameron International Limited, which grants the Schlumberger group company a non-exclusive licence to use the POS-GRIP and HG® metal-to-metal seal method of wellhead engineering for the development of conventional and unconventional oil and gas surface wellheads.

Plexus' suite of ongoing products and applications include: "HG" wellheads, which combine POS-GRIP technology with gas tight metal sealing; the Python® subsea wellhead (a new standard for subsea wellheads - developed in a Joint Industry Project supported by Royal Dutch Shell, BG (now owned by Shell), Wintershall, Total, Maersk (now owned by Total), Tullow Oil, eni, Senergy (now Lloyds register), and Oil States Industries Inc); the POS-SET™ connector for the growing de-commissioning and abandonment market; and Tersus-PCT, an innovative HP/HT tie back connector product. The Company also has a collaboration agreement in place with TFMC, which provides a platform to further develop and commercialise these and other applications based on its POS-GRIP technology.

 

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