"We expect this technology to help reduce drilling operation costs and are therefore putting up half of the total NOK 28 million investment in the company," says Halvor Breivik of Hydro Technology Ventures.
Hydro Technology Ventures and Viking Venture II AS are investing NOK 14 million each in the Oslo-based company Ocean Riser Systems (ORS), which specializes in pressure control services for deep-water drilling and well operations.
"We are pleased to be able to make this investment in what we consider to be trendsetting technology, which will potentially revolutionize drilling and impact positively on the economics of well operation," says Viking Venture partner Shane McElroy.
"Ocean Riser Systems has a very competent team that will now receive the enthusiastic backing of active owners. Our goal is to strongly develop the company in the years to come," adds McElroy.
The investment will fund Ocean Riser Systems' commercialization of the drilling technology "Managed Pressure Drilling."
This technology will enable lighter and cheaper drilling rigs to be used, also when conducting drilling operations at great ocean depths.
Other advantages are:
"This method is very interesting for the oil industry, since it can reduce drilling operation costs by between 20 and 35 percent," explains Breivik.
Solving fundamental problem
This technology can be used when drilling deep-water production and exploration wells, and when conducting maintenance on production wells and seabed operated fields.
"Subterranean pressure conditions largely determine how long it takes to drill an oil or gas well, how much it will cost, and how great a risk is being taken. ORS will adopt a completely new method for controlling and regulating pressure in a well being drilled. We have therefore solved a fundamental problem the industry has struggled with since day one, providing cost savings and environmental and safety gains," says Ocean Riser Systems CEO Borre Fossli.
"The fact that such expert organizations as Hydro Technology Ventures and Viking Venture see the great technological potential, and are investing considerable funds in the company, represents a decisive step in introducing the technology to the market."
Hydro's Bjorn Engedal, who heads the company's drilling and well technology unit, says:
"The biggest challenge in improving well operation efficiency is to reduce the number of unwanted incidents caused by drill-hole walls cracking or caving in. ORS is developing a technology that will enable greater control of bottom-hole pressure when drilling. This will help limit the strain to which we subject the formation."
Hydro Technology Ventures, established in March 2001, has NOK 750 million under management. The fund invests in forward-looking companies developing technologies relevant to Hydro's oil and energy operations.
Viking Venture Management AS is a leading Norwegian venture capital company, with two funds under management with a total capital of NOK 580 million, that has its focus on early-stage investments in the IKT, energy (including oil and gas) and medical technology sectors.
Ocean Riser Systems AS was established in 2002 and has its headquarters in Oslo. The company, which employs personnel with experience from operator, drilling and service companies, has developed a new technology and method for drilling and well intervention. It will supply equipment and services to this market.
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