Aberdeen-based international energy service giant Wood Group is planning to spend up to £134million on its latest worldwide acquisitions this year.
This was revealed by chief executive Allister Langlands yesterday as the company said it was well positioned to deliver good longer-term growth, despite a fall in profits and turnover in 2009.
Pre-tax profits dived 31% to £177million, while turnover slipped by 6% to £3.3billion.
Wood was hit as the world recession, volatile financial markets and lower oil and gas prices contributed to a reduction in global exploration and production expenditure of about 15% last year.
Mr Langlands told the Press and Journal that the group was trying to grow its international footprint.
Areas being targeted for acquisitions include north and west Africa, the Middle East, Caspian and Asia-Pacific.
The chief executive said Wood had a pretty busy year in the North Sea in 2009.
He added: “This was a reflection of the new business won in 2008.
“Last year, we were very busy with TAQA, landed an extended contract with Total and won two new contracts with Chevron. Generally, I think we will continue to be busy in the North Sea.”
Credit Suisse, which has an “outperform” rating on Wood stock, said: “Wood Group has competently managed through the downturn . . . and is now poised to benefit from a recovery in upstream oil and gas spend.”
Shares closed up nearly 2% last night at 370.8p.
Chairman Sir Ian Wood said many customers expected an oil price of $65-$85 a barrel over the next year or two. He said surplus Opec capacity was likely to temper any further upside to the oil price as global economies recovered and energy demand began to grow again.
The chairman added: “More recently, we have also seen the US gas price begin to recover and this, together with the potential in non-conventional gas deposits, should encourage increased investment in the US gas market.
“In the medium term, new oil and gas developments will be increasingly focused on harsher environments – deeper water, subsea, arctic regions and oil sands.
“With our differentiated know-how and range of services and products in these sectors, we should be in a good position to benefit.
“There is also increasing investment by operators to maximise the recovery of hydrocarbons from their existing fields, an area in which we have a strong track record of cost effective and innovative production enhancement on longer-term contracts globally.
“We are also going to see increasing investment in clean energy solutions to complement oil and gas resources. We intend to use our growing knowledge and expertise in this area, including carbon capture and storage and renewables, to help our wide range of customers meet increasing environmental and climate change objectives.”
Sir Ian said the group’s focus on production support, an increasing differentiation of its services, its market-leading positions and good international spread would continue to stand it in good stead in 2010.
“Beyond that, we believe the fundamentals for oil and gas services and gas-fired power generation remain strong and we are well positioned to deliver good longer-term growth,” he added.
