Aberdeen-headquartered drilling contractor KCA Deutag has suspended new investments in Russia, as oilfield services firms join energy majors in reducing exposure to the Russian market following the invasion of Ukraine.
The drilling firm employs nearly 9,300 people worldwide, operating and managing around 110 drilling rigs in 20 countries, including 21 units in Russia.
On Monday KCA chief executive Joseph Elkhoury released a statement in which he said the company was “shocked and saddened by the deteriorating situation in Ukraine” and called upon “all parties to urgently work towards a peaceful resolution in the region.”
Since the start of the conflict, the company said it had established a dedicated committee to actively monitor the situation and stay in full compliance with “all applicable” sanctions.
It has suspended all new investments in Russia and is “evaluating its options relating” to the Russian business, the statement added.
“We remain focused on the health, safety and security of our colleagues and their families in Ukraine and Russia. Our thoughts continue to be with those impacted by these tragic events,” Mr Elkhoury continued.
KCA Deutag has been operating in Russia since 2002 and, according to recent filings, its Caspian and Russian business generated over $280 million in revenue in 2020 – nearly a quarter of group-wide income for that year.
Last June KCA secured a five-year deal for platform drilling services offshore Russia, reportedly working with Sakhalin Energy.
Its statement follows increasing pressure from UK and foreign governments to cut ties, including an open letter from Scotland’s Finance and Economy Secretary Kate Forbes MSP, in which she asked businesses to take “economic action” by reviewing their operations for links and connections to Russia and severing them.
Meanwhile, over the weekend the largest global oilfield services firms were also reported to be halting future work in Russia in response to the war in Ukraine.
Baker Hughes and Schlumberger will reportedly halt future investments but leave current projects intact, while US-based Halliburton intends to cease all present and future activity.
Weatherford International said it had suspended new investments and technology-deployments and placed a hold on shipments.
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