UK-based Odfjell Technology has reported that a workover contract it had in place for south-east Asia has been scrapped by its client, Brunei Shell Petroleum Company Sendirian Berhad.
In a statement, the company said that its client was “terminating this contract for convenience”.
It added: “The client reiterates that the termination is not related to the performance of Odfjell Technology and the two parties remain open to working together on future potential projects.”
Odfjell Technology said that it will close out the contract in accordance with any terms and conditions, with any expenses to be reimbursed by the client.
It also added that there will be “limited” financial effect in 2025 following the cancellation.
Asia Pacific is a region where the company is keen to grow its footprint, however, after entering the Indonesian market, and also landing the services of Australian energy industry equipment provider, R&D Solutions, earlier in the year.
It means Odfjell Technology’s industry-leading well intervention services, wellbore clean up and whipstock tools are now also available to service the Australian well services and deepwater markets, with plans for future growth in the regional plug and abandonment sector.
In its 2024 annual report, released recently, the company also reiterated its global growth ambitions.
“We are well positioned for growth in a competitive market in 2025,” it noted. “Our ambition is to increase our global footprint with well services, entering new geographies as we have in
2024, and focusing on high margin product lines.”
It added that technology development and strategic growth represent a large part of its ambitions for its well services division in 2025.
As well as its European activities, the company is also active in North America, Africa and the Middle East.
But while the cancellation of the project in Brunei may have little immediate impact on finances, it is a blow to the group’s forward aspirations.
In its 2024 annual report, the company noted that the Brunei workover job “opens both an exciting geographical market and type of service, with huge potential.”
Commencement for workover operations in south-east Asia was scheduled for the middle of this year, while mobilisation efforts began last November.
In November, Simen Lieungh, CEO of Odfjell Technology, highlighted the contract’s importance “for significantly increasing our footprint in south-east Asia.”
But in his introductory notes in the 2024 annual report he remained bullish about the group's overall global growth prospects in 2025.
“We will actively explore opportunities for acquisitions and international expansion in line with our strategy,” he noted.
