International trade during the pandemic has been something of a double-edged sword for many oil and gas firms.
On the one hand, it has allowed companies to target regions that haven’t been as badly hit by the virus in the absence of those that have been cast into lockdown.
On the other, travel restrictions have slowed down operations.
For Aberdeen-headquartered oilfield equipment specialist OSSO, it has been a case of taking the rough with the smooth.
“Covid hasn’t made things particularly easy as far as having an international operation goes. We always knew for the first year and a half of operating the company, it was going to be about team building and making sure that we’ve got the right people for growth – we’ve been continuing along that road,” said James Scullion, OSSO’s chief executive.
He added: “Everyone keeps talking about Covid, but it hasn’t really got in the way too badly. It’s certainly slowed operations down a little bit but, on reflection, for the first six months in the position, it’s been very good.”
Scullion took up the top job at OSSO in January, at the same time as the company, formerly Centrifuges Un-Limited, announced a rebrand.
The two changes were part of a major growth drive within the business, which was acquired by Linton Investments, the investment arm of the Ferguson family, in 2020.
Two pillars of OSSO’s ambitions are to diversify beyond oil and gas operations and to expand into new international markets.
And Scullion says its traditional hydrocarbon operations put the company in a perfect position to cast its net further afield.
He said: “Oil and gas is a fantastic sector to be able to grow internationally because you can replicate. If you are successful in one region, the likelihood is, as other areas develop, they’re going to have the same demand.
“We can use our oil and gas footprint to help internationalise our other product lines. That’s where we see a lot of our growth coming from.”
As it stands, international markets account for about 30% to 40% of OSSO’s total revenues.
But it’s hoping to build on that, spearheaded by its drive to help reduce operational oil and gas emissions and diversify into new clean forms of energy, such as geothermal.
Scullion said: “For oil and gas, there’s going to be a lot of activity in the lower lift cost regions, like the Middle East. There’s a lot of demand in those sorts of places.
“South America will be another huge market as well but, personally, I would like to grow a little bit more into the Far East, and potentially in Australia.”
However, Scullion said there’s still work to do to cement OSSO’s footprint in its existing markets, adding it’s “adapt or die”.
The company’s operations are primarily focussed on the UK, Norway and the Middle East, where it offers a wide range of fluid management solutions, both offshore and onshore.
Covid has made that more challenging though, with restrictions on travel making it harder for OSSO to develop and secure new opportunities in existing strongholds.
Nevertheless, Scullion said the company has adjusted well to the challenges.
He added: “We’ve got a really good team of people in the Middle East who have been leaning harder on the networks that they have to make sure that we’re still getting the same level of opportunities.
“Aside from that, we’re looking at more adaptable partnership models to make sure that we have presence in the areas that we need to.”
Having a well-established global network gives OSSO a good platform with which to achieve the company’s goal of expanding its international operations.
OSSO will have to do that without government help though, after Holyrood and Westminster both laid out plans to wind up overseas trade support for oil and gas activities.
With companies being left to fend for themselves, there are concerns the decision could hamper the sector’s recovery following a bruising last few months.
Current estimates have oil and gas as playing a significant part in the energy mix for decades to come, and hydrocarbons are likely to be needed in various forms indefinitely.
Despite the pressing need to decarbonise operations, the sector still has a “big future”, Scullion said.
He added that OSSO’s previous owner, Aberdonian entrepreneur Jim Shiach, had “a lot of success” using government trade support schemes.
Scullion also said it is “sad” that the change in policy doesn’t reflect the sector’s role in pushing the boundaries of engineering.
“There’s a huge amount of transferable skills that can be taken from oil and gas into things like geothermal and the production of green hydrogen. Look at the way the offshore wind sector has benefited from the industry’s expertise,” Scullion said.
He added: “It would be more beneficial for us if there was still support in place, but it is what it is. We will adapt to that, as we have too many other things. It’s not going to be a deal breaker for us.”
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