Simmons Urges Oil & Gas Industry to Capitalize on Its World-Class Technology Innovations

Oil and gas companies are being urged to harness the opportunities to develop major game-changing technologies.

Nick Dalgarno, managing director of Simmons and Company International Limited in Aberdeen, gave advice to the industry when he addressed delegates at a city conference showcasing technology yesterday. (Wednesday, Sept 22).

He said the industry must rise above the challenges associated with risk aversion which have historically affected it and which may result from the recent Macondo incident in the Gulf of Mexico to capitalize on the opportunities:

“The Macondo incident has inevitably heightened liability issues and will trigger a move towards de-risking projects. In an industry which has always been risk averse, there is potential for operators to stick with established technologies and processes. This would be a missed opportunity, and the combination of rising operating costs and the steady oil price of around $70 to $80 per barrel offers potential for new technologies that can generate incremental margins for operators who will hopefully be more focused on efficiencies created by high-quality services rather than price.

“Innovation and enterprise are at the core of the North-east’s oil and gas expertise and with much evidence of proven technologies in the North Sea, the region is well placed to capitalize on this market.”

Mr Dalgarno said that securing finance for future growth was also vital for many specialist technology companies, particularly small or young emerging businesses:

“Attracting the right type of investment is crucial for fast growing businesses. Simmons has established a strong track record of raising finance for young technology companies and our unique industry and technology team plays a key role in identifying and explaining the key selling points of such technologies.

“Our clients have included companies which have developed some of the industry’s most exciting new technologies such as Gas2 Limited, which secured a £10million growth capital investment by Lime Rock Partners. Gas 2 has developed a pioneering portfolio of technologies for method for turning gas into liquid which was originally conceived at Robert Gordon University.

“Simmons was also instrumental in helping remote technology specialists Red Spider Technology to gain £7.5million growth equity in a recent funding round led by Energy Ventures. The funding is to accelerate internationalization of the business and complete the commercialization and roll-out of remote well-intervention and completion technologies.”

Mr Dalgarno was the keynote speaker at a showcase of cutting edge technology held at Aberdeen Exhibition and Conference Center. The event, which demonstrated inventions from more than 30 organizations aimed at solving some of the industry’s most costly challenges, was organized by the Aberdeen arm of the Society of Petroleum Engineers (SPE Aberdeen) and ITF, the Industry Technology Facilitator.

Neil Poxon, managing director of ITF said: “Nick Dalgarno emphasized key opportunities for technology companies and we were delighted to have the support of Simmons which has a proven track record in helping to raise finance for the development of new technology.

“As we continue to look to technology innovation to increase and enhance hydrocarbon recovery, it is important that the industry embraces technology development as a means to increasing output in a more cost effective manner.”

About Simmons & Company
Simmons & Company International Limited is part of the Simmons & Company International group of companies (SCI). A specialist corporate finance adviser covering the entire spectrum of the energy industry, SCI has offices in Aberdeen, Houston, London and Dubai.. SCI provides corporate finance, research, institutional sales and trading.

The firm’s corporate finance group specialises in advisory services for mergers and acquisitions and raising debt and equity capital.

In 2009, Simmons globally completed 32 transactions with an aggregate value in excess of $2 billion.