Licence Agreement with Shell for drilling tech
10 September 2019
Enteq Upstream plc
("Enteq"")
Licence Agreement with Shell for drilling technology
Enteq, the oilfield services technology and equipment supplier, is pleased to announce that on 10 September 2019 it jointly signed a license agreement with Shell Global Solutions (US) Inc. and Shell Global Solutions International, both subsidiaries of Royal Dutch Shell plc ("Shell") (the "Licence"). This Licence gives Enteq exclusive rights to incorporate Shell's patented intellectual property plus other technology (the "Information") into the engineering and manufacture of a specialised Rotary Steerable drilling system.
Rotary Steerable systems are becoming a new standard for fast and efficient drilling of oil, gas and geothermal wells. The combination of Shell's Information and Enteq's proven track record of product innovation, engineering and commercialisation offer the potential to produce a "next generation" type of product utilising a novel and unique steering method with potential significant cost reductions and other benefits of operation.
The Rotary Steerable drilling market is currently estimated at $1bn within the globally assumed $10bn directional drilling sector for Oil and Gas and expected to grow at 7% CAGR.
The Information and License relate to a system that has currently been deployed and tested in an early stage prototype. Enteq envisages that the development of a commercial system will take up to a further two years and may require a total investment of up to approximately $3m over that period, including some initial payments to Shell. Additional expenditure for the subsequent build of trial and commercial inventory would be required and royalty payments will be due to Shell when commercial.
Adrian Chesters, Shell General Manager Wells Technology commented "Enteq is a strong licensee and collaborator for this project due to its status as an independent supplier with access to the directional drilling market. Their interest in further developing and commercialising the technology aligns well with our own."
Martin Perry, Enteq's Chief Executive Officer commented "The Enteq team has a track record in commercialising innovative engineering projects which have achieved good market share. We look forward to building upon Shell's innovative work to date in order to bring an exciting new product to the directional drilling market."
Enteq will issue a trading update on 25th September 2019, ahead of the AGM that will be held later that day.
For further information, please contact:
Enteq Upstream plc +44 (0)149 461 8739
Martin Perry, Chief Executive Officer
David Steel, Finance Director
Investec Bank plc (NOMAD and Broker) +44 (0)207 597 5970
Chris Treneman, Patrick Robb, David Anderson
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