Direct Contract Awarded by Petronas Carigali Sdn Bhd, July 2014

We are pleased to announce that we have received a direct contract for the provision of Well Tractor and mechanical intervention services for PETRONAS Carigali Sdn Bhd in Malaysia. The scope of the work is for rig support and well interventions as required for 70 wells in the east region assets group, including Sabah and Sarawak.

CONTACT

VP Marketing
Brian Sidle
bsidle@welltec.com

We will be providing a broad range of our e-line based technologies such as the Well Tractor, Well Cutter, Well Stroker, Well Miller, Well Key and Well Cleaner. With this portfolio we will help Petronas Carigali increase safety and efficiency on rig operations as well as perform, remediate and improve production from platform wells.

‘This is an exciting award for Welltec. This successful tender award will enable Petronas Carigali Sdn Bhd to capitalize on our new technology for supporting its rig operations on development wells in addition to making use of our unique services to realize the full production potential of their existing wells. Our e-line based solutions provide them a portfolio of services capable of transforming how they conduct their well work.’ says Ronan Le Gloahec, Senior Vice President, Welltec. Welltec has been operating in Malaysia since 2002 where we opened our first office. Today we have three offices in the country from where we have performed some spectacular e-line operations like milling of a faulty lubricator valve, scale milling and tractoring 81,000 ft on a logging job in a well with 91°deviation.

Read more about these case stories here.


Well Miller and Core Bit Retrieves Faulty Lubricator Valve in Malaysia, July 2014

During a re-activation campaign an operator encountered a faulty lubricator valve preventing re-perforation and future interventions. They turned to Welltec due to our track record and proven service quality. A Well Miller with custom-made, core milling bit removed the malfunctioning valve.

CONTACT

VP Marketing
Brian Sidle
bsidle@welltec.com

Both upper and lower valve coupons were retrieved in two successive runs with the aid of a special ‘catcher design’ in the inner core of the bit. Having restored access to the well, the operator could then continue with their re-activation campaign estimated to increase production by eight mmscf per day.

Welltec’s solution saved more than a week compared to coiled tubing, which generated substantial cost savings. The milling job itself took a day with an actual milling time of just around two hours. Being able to perform the operation on e-line offered a lightweight solution, reducing operational risks.

To learn more about the Well Miller and bits, please download our Milling Solutions brochure, or read the full case story.


Cutting Edge Mechanical Solutions, June 2014

Welltec continues to increase the capabilities of what can be done with mechanical cutting. In Q1 of 2014 we accomplished a series of successes that pushed the boundaries even further for what can be done on e-line.

CONTACT

VP Marketing
Brian Sidle
bsidle@welltec.com

Cutting under compression Several jobs have been performed in 2014 where the tubular was in compression. In the Middle East, the Well Cutter was deployed rigless in four 4-1/2 in. (3.958 in. ID) ERD wells in order to reduce rig time during workover operations. Five cuts were successfully performed in 4-1/2 in. tubing in 20,000 lbs of compression. Moving further south we have recently carried out the first operation in India where a 5-1/2 in. 20# 13Cr L80 tubing was cut under natural compression to increase the safety aspect of the job. At 3,832 ft water depth this was also the deepest water depth well in which the Well Cutter has been operated. Wide range of materials We now offer the ability to cut standard carbon steel, chrome and super chrome. On an operation offshore Azerbaijan the Well Cutter 358 was applied to cut a 5-1/2 in. OD 26# Super 13Cr 110KSI tubing in one run. The larger Well Cutter 414 has also demonstrated the ability to cut the hardest materials. In the North Sea the tool made a cut in a 7 in. 29 lb/ft Super 13Cr tubing in 1:20 hours. Collar, casing, drill pipe cutting Recently, the Well Cutter 358 demonstrated the ability to cut through both the 5-1/2in. tubing and the associated 6.2” OD collar on a job in Norway. After 30 hours of operations, a smooth, conical profile of the cut was confirmed.

We have also added drill pipe cutting to the repertoire. The Well Cutter has cut a 5-½ in. drill pipe offshore Norway in order to perform a side-track. The precision cut needed to be made below the upper collar of the last stand, just above the x-over from the 5-1/2 in. to 5 in. section. Wide range of tool sizes Today we offer tool sizes ranging from 3-1/8 in. to 4-1/4 in. OD. The latest development, the 4-1/4 in. Well Cutter, has been applied recently on a number of jobs offshore Russia and Norway where 7 in. OD, L80, L80 13Cr as well as Super 13Cr casings received ‘the perfect cut.’ Increased safety and efficiency for operators The Well Cutter is an innovative tool that enables efficient and safe drill pipe, liner, tubing and casing recovery operations without the use for explosives. In 2013 it won the OTC Spotlight on Technology award plus the ICoTA Intervention Technology award. Operators around the globe have embraced the technology and benefitted from increased safety and efficiency through application of the Well Cutter. Please click here for more information about this cutting-edge tool.


Welltec Russia wins 2-year Well Tractor contract

Following a successful pilot project in February, Welltec Russia has successfully secured a 2-year tender award for a major Russian operator. Contract value is expected to exceed $2M USD.

The project scope includes 19 wells located across northern Russia land and involves arctic challenges for which Welltec’s solutions are exceptionally well suited and qualified for.

Lars Mangal, Welltec Chief Commercial Officer & Senior Vice President of UK, Russia/CIS and Continental Europe, explains “This is a key award giving Welltec the opportunity to further demonstrate our unique, inherently safer robotic electric line deployed well intervention technologies in the Russian market. Compared to traditional pipe based intervention methods, Welltec enables well intervention operations to be mobilized at short notice and with significantly reduced operational risk. Our Well Tractor conveyance systems enable production logging campaigns to be conducted with much improved data quality and greater flexibility for mobilizing in Arctic environments. This award also confirms the high degree of confidence operators in the Russian market have in our Welltec Russia team working in their field operations and the associated high levels of outstanding service delivery performance being realized as a result. ”

Contact: Rick Schafers, Welltec Area Vice President, Russia & CIS


Welltec Reaches 10 Years of Safe Operations in Alaska, May 2014

Welltec Alaska has achieved an industry record performance that we are extremely proud of: 10 consecutive years with no environmental incidents or personal accidents while working on the North Slope. This milestone has been reached thanks to our competent and dedicated employees who have followed Welltec’s corporate vision and mission for HSE excellence.

CONTACT

VP Marketing
Brian Sidle
bsidle@welltec.com

Through the years Welltec Alaska has continued to set ambitious goals and objectives, improving environmental performance through efficient Waste Management, Maintenance Management and recycling programs. With this commitment, Welltec Alaska has been able to actively reduce pollution from our activities.

Welltec’s successful HSE culture includes providing work free from harm and giving the safety of people and the protection of the environment the highest priority. The Alaska team has demonstrated a commitment to provide a safe and healthy workplace for all our employees and for those we work with. They have encouraged those around them to stop unsafe acts and activities ensuring no incidents or accidents, leading by example and strengthening our HSE organization locally as well as globally.

What characterizes the HSE process at Welltec is the desire to share knowledge across teams, projects and borders and to measure and analyze trends and root causes. This dedicated procedure ensures optimal working conditions and commitment to our safety mantra.

What characterizes the HSE process at Welltec is the desire to share knowledge across teams, projects and borders and to measure and analyze trends and root causes. This dedicated procedure ensures optimal working conditions and commitment to our safety mantra.

While working with operators such as BP, ConocoPhillips, ENI, and Pioneer, this outstanding industry record demonstrates our vision of working safe and focusing on innovations to secure a safer tomorrow.

Numerous field engineers and personnel have been involved in setting this record and we are proud of and thankful to each and every one of them. They have all been dedicated to the strong HSE culture that has been firmly established and followed. It will drive Welltec Alaska to continue their track record of excellent service and HSE performance.

Congratulations!


Interim Report Q1 – 2014

INTERIM REPORT Q1 – 2014

Key highlights
Welltec® delivered a first quarter result with revenue growth aligned to full year expectations, following an uplift in high-complexity work which counteracted the impact of adverse operating conditions in its largest market, Scandinavia. EBITDA was improved by the sales mix and improvements in utilization and operational efficiencies. Accordingly, Welltec® maintains its guidance for 2014.

  • Revenues increased by 6% year on year to USD 80 million with varied regional contributions:
    • In Europe, Middle East, Africa and Russia CIS (EMEAR), revenues increased by 9% to USD 42 million.
    • Revenues in the Americas were flat at USD 27 million.
    • Asia Pacific revenues grew 6% to USD 10 million.
  • Welltec® posted a 31% increase in EBITDA to USD 35 million, representing an EBITDA margin of 44% (36% in Q1 2013).
  • Operating profit (EBIT) increased to USD 17 million (USD 14 million in Q1 2013).
  • Management maintains its expectations on full-year revenues of around USD 340 million (6% growth) with EBITDA of USD 140 million, representing an EBITDA margin of around 42%.

Jørgen Hallundbæk, CEO: “As expected, the first quarter results reflect early progress on some of our key initiatives for the year. Our focus remains to promote well optimization and production with our enabling technologies, allowing our clients to be the best at what they do. In particular, we’ve seen continued adoption of our Milling and Mechanical solutions around the globe in a host of challenging environments. These continue to push the boundaries on what can be done to quickly restore production in a safer, more sustainable way.”

EBITDA-extended_web

Investor conference call

Welltec® will discuss its results during an investor conference call today at 5 pm CET. An accompanying slide presentation is available on the “Investors” section of www.welltec.com under the subheading “Download Center”. The conference call can be accessed by dialing in a few minutes before the start and informing the operator that you are dialing in for Welltec’s investor conference call, conference ID 24351848.

Conference access numbers

Denmark: +45 32 72 80 18
UK: +44 8445 718 957
US: +1 866 682 8490

The call will be webcast simultaneously and available online following today’s live transmission.
For further information, please contact:

Jesper Helmuth Larsen, CFO
Cell: +45 2329 2600

Company Profile

Welltec® is a leading provider of robotic intervention services and completion solutions to the oil and gas industry. Our pioneering technology enables operators to optimize the management and development of their assets throughout their life cycle. We address the factors that maximize value creation, continuously innovating to reduce well construction time, speed up access to the hydrocarbons and reduce the capital expenditure compared to more conventional methods. The effect is one of maximizing hydrocarbon production and increasing total recovery while minimizing operating downtime.

Our lightweight technology also reduces the risk to personnel and increases many safety aspects of the industry by enabling smaller work crews and minimizing heavy lifting. Furthermore, our technology allows operators to avoid the use of rigs, significantly reducing the industry’s carbon footprint. Our ability to operate in extended reach and horizontal wells allows operators to drill multiple wells from the same topside location, thereby further reducing the environmental footprint.

This is Welltec’s philosophy; to challenge existing conventions and think laterally in order to develop products and services which increase oil and gas recovery while improving the sustainable, economic, environmental and safety aspects of our industry. In practice we develop, test and manufacture state-of-the-art technology to enhance the production and recovery rates for our clients, thereby improving their profitability through a longer term revenue stream, while at the same time improving upon health, safety and environmental attributes.

Our game-changing solutions allow our customers, some of the world’s largest national and independent oil companies, to optimize production through ground-breaking flexible well completion solutions (WCS) and innovative well intervention services (WIS). Our disruptive innovation challenges the conventions, maximizing production, increasing oil recovery and improving well-integrity and safety, with faster and less intrusive solutions in environments that are becoming increasingly complex, remote and hostile.

In an industry characterized by maturing fields and increasing depletion, the premium attached to technology which aids in reversing these trends is continuing to gain momentum. Our value proposition is compelling; our technology enables clients to unlock more production from their assets and to address reservoir complexities and uncertainties with a greater number of options, which are cleaner, safer and more sustainable.

Important Notices

Any statement in this announcement that is not a historical fact is a “forward-looking statement”. Such statements may include opinions and expectations regarding Welltec® and its future business, management’s confidence and strategies as well as details of management’s expectations of new and existing programs, technology and market conditions. These forward-looking statements rely on assumptions concerning future events that are subject to a number of risks and uncertainties, many of which are outside Welltec’s control, and which could cause Welltec’s actual results to be materially different from these forward-looking statements. While Welltec® believes that its assumptions concerning future events are reasonable, there are inherent difficulties in predicting certain important factors that could impact the future performance or results of Welltec’s business. Accordingly, such statements should not be regarded as representations as to whether such anticipated events will occur nor that expected objectives will be achieved. Welltec® expressly disclaims any intention or obligation to revise or update any forward-looking statements, whether as a result of new information, future events, or otherwise.


Welltec Wins the ICoTA Intervention Technology Award

For the second, consecutive year Welltec was recognized as the winner of the Intervention and Coiled Tubing Association (ICoTA) Intervention Technology Award. This prestigious award is given to companies that have developed new, innovative technology which provides value to the industry.

The Welltec Lateral Intervention Tool (WLIT), developed in partnership with Saudi Aramco, was the winner this year based on its merits; a new product which aids in reducing risk, helping to increase production, improves safety and minimizes environmental impact.

The WLIT is designed to overcome one of the severe limitations facing the industry today which is the ability to re-enter sidetracks consistently and effectively. What is unique about the WLIT is that it facilitates access to lateral sections by electronically detecting the casing window, determining its orientation, shifting a steerable joint and thereby directing the toolstring or coiled tubing into the lateral.

This controlled access subsequently enables operators to gain information about the reservoir where it was previously not possible. And the toolstring can convey not only itself into the lateral but also 3rd party, mono conductor e-line tools. This opens up the possibility of PLT’s, cement bonds, well integrity, even some open hole logging tools to gain the required information.

In turn, this can lead to increased production by managing the individual laterals, increasing overall reservoir knowledge and gaining the confidence to drill more wells or laterals for improved reservoir and field management.

The WLIT is designed to illuminate the reservoir by increasing access and subsequently knowledge so that the operator can optimize production over the life of the field.


Welltec Receives Best Stand Award at the APPEA

A stand-out stand design and team effort were the winning elements at the Australian Petroleum Production & Exploration Association (APPEA) conference and exhibition where Welltec won “Best Custom Build of the APPEA 2014 Exhibition” award.

The award ceremony took place on April 9th where Welltec’s Team Exhibition Leader, Susan Keegan Elleskov received the award during the closing ceremony attended by the CEO of APPEA and Australasia oil & gas executives.

Welltec’s stand took home the award due to a list of criteria including design and functionality, the level of innovation of the solutions displayed as well as the interaction with visitors.

“We enjoyed a fantastic show thanks in no small part to a great stand design that made it easy to demonstrate and discuss our capabilities. And we experienced an extraordinary attendance and interest in our technologies and service offerings, especially our new Well Cutter” voices Ronan Le Gloahec, Senior Vice President.

APPEA was recently held 7-9 April in Perth. It is the largest annual upstream oil and gas event in the southern hemisphere attracting about 3,500 delegates from more than 30 countries this year.


Raising the Roof! – Welltec expands in Esbjerg

Under a clear, blue sky in Denmark’s energy capital, Esbjerg, Jonny Søtrup, Mayor, officially welcomed Welltec to the city as the roof was raised on our new manufacturing facility.
In addition to the Major, the event was attended by other dignitaries, clients, guests and Welltec employees. In his speech the Major, who also attended the opening of the US Headquarters in Katy, Texas last year, joked that Welltec should make it an annual tradition to open a new facility each year.

Although we are constantly growing and would like to achieve that challenge, Jørgen Hallundbæk, CEO, made no promises in that regard. He did say that “It is a great joy to attend this successful topping-off ceremony today with so many people who are central for our new factory as well as our new product line, which we will be producing here. Just like these new facilities will create a good and secure framework for our technologies, our Welltec Annular Barriers will create greater reliability and safety in the industry.”

“These facilities will increase our manufacturing capacity significantly and ensure we are able to deliver high quality products to the rapidly growing market demand for our completions solutions. The location in Esbjerg allows us to further develop our relations to clients and partners in the North Sea,” Jørgen Hallundbæk concluded.

The 65,000 sq ft manufacturing area will be the home of our Completions Solution offering, which currently includes the Welltec® Annular Barrier (WAB®) for cement assurance and zonal isolation. The facility will also be used as an offshore supply base and a hub for Welltec’s operations in the Danish, German and Dutch parts of the North Sea as well as land-based operations in Central Europe.

Please click here for more information about our completions solutions.


Esso Angola Awards Welltec a Direct Contract for Services in West Africa

Welltec is pleased to announce the award of a three year, direct contract from Esso Exploration Angola (Block 15) Limited (Esso Angola), Operator of Angola Block 15, for the provision of conveyance and well intervention services including clean-out and mechanical manipulation.

Welltec technologies and services increase flexibility and reduce the mobilization time for key intervention operations compared to conventional intervention methods utilizing coiled tubing or jointed pipe. Other benefits include a reduction in the number of lifting operations, personnel and footprint, all contributing to improved risk management; particularly in environmentally sensitive environments.

‘Gbenga Onadeko, Welltec Senior Vice President, Africa explains that “Welltec, a pioneer and market leader of robotic conveyance and intervention technologies, is extremely pleased by this award from Esso Angola. We have provided services to Esso Angola since 2005.”

Welltec is the largest provider of tractor technology for conveyance solutions as well as the foremost provider of milling, clean-out and mechanical solutions globally. These technologies have been successfully developed and applied by Welltec for nearly two decades.