HONG KONG (Dow Jones), Sept. 28, 2009
Hong Kong-listed TSC Offshore Group Ltd., which makes and supplies drilling products for oil companies, is looking for acquisition opportunities in China and elsewhere, a senior executive with the company said.
"Spending in deepwater exploration and production will continue to escalate...We see great potential in the deepwater offshore regions in Brazil, China and the Gulf of Mexico," Chief Executive Morgan Zhang told Dow Jones Newswires.
"We hope to provide a wider range of products and more complex technologies through acquisitions to support deepwater oil production," he said.
"I can't comment on something specific, but we're looking at companies with which there are synergies," said Zhang.
He declined to give a time frame or give an idea of the scale of potential acquisitions.
The CEO of Houston-based TSC Offshore pointed to Brazilian state-run energy giant Petrobras' offshore discoveries as evidence of the potential for deepwater contracts.
TSC Offshore has said it will take part in the development of Petrobras's vast new offshore oil reserves by making equipment needed for the ambitious project.
"We are in a very good position to capture the growth opportunities as we are among the few companies in the world that are capable of undertaking a wide range of projects for offshore rigs," he said.
The Brazilian state-run energy giant said in January it has budgeted US $174 billion over the next five years (2009-13) to exploit its oil reserves in fields like Tupi, Guara, Iara and Carioca, which were discovered in deep water beneath a thick layer of salt.
Other recent deep water discoveries include Anadarko Petroleum Corp.'s find off the coast of Sierre Leone in mid-September, which came in the wake of a BP PLC discovery in the Gulf of Mexico, 250 miles south of Houston.
TSC, which moved its listing to the main board in June from the Growth Enterprise Market, said earlier this month its first-half net profit rose 55% to US $5.89 million from US $3.80 million, boosted by overseas operations it acquired last year.
To enhance its capabilities and ensure long term earnings growth, TSC in 2008 acquired for US $26 million U.K-based Global Marine Energy Plc, which supplies equipment for offshore drilling and exploration.
The company's top five customers are Petrobras, Norwegian's oil and gas group StatoilHydro ASA, Transocean Ltd., Schahin Group and GustoMSC.
TSC is now bidding for tenders for three overseas projects, with estimated contract sums ranging from US $60 million to US $100 million, in areas covering Middle East and India.
The tender results are anticipated to be announced in the coming two months, he said.
The company had US $98.9 million worth of uncompleted orders for rig products and technology at the end of June.
Copyright (c) 2009 Dow Jones & Company, Inc.
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