Saipem has been awarded onshore drilling contracts in the Middle East and South America worth $250million. The awards include two key contracts from the Kuwaiti national oil company which is looking to develop the country's resources.
Italian oil contractor Saipem SPMI.MI is working with Bain & Company to draw up a restructuring plan to help it cut costs and counter falling oil prices that have sapped its order book and stretched its balance sheet, three sources said. Saipem, 43 percent owned by state-controlled Eni ENI.MI, has lost around three-quarters of its value in the last 30 months after a corruption probe in Algeria, two profit warnings and increasingly bleak business prospects. The cancellation of a Black Sea pipeline contract was the latest blow. (Full Story) "The plan is called 'Fit to 60' -- whipping the company into shape to deal with life with crude at $60 a barrel," a source with knowledge of the matter said. Low oil and gas prices have prompted majors and governments the world over to cut energy investments and shelve projects, starving oil service companies of business and forcing them to streamline operations.
Saipem has posted a better than expected profits boost in its first quarter results. The Italian oil services group, which is 43% owned by oil major Eni, said its earnings before interest and taxes came in at €159million.
Saipem has been awarded a $1.8billion engineering and construction contract from the Kashgan field project in the Caspian Sea. The deal, through its subsidiary ERSAI Caspian Contractor LLC, is for the construction of two 95km pipelines which will connect D island in the Caspian Sea to the Karabatan onshore plant in Kazakhstan.
Oil and gas contractor Saipem said it was not given formal notice the South Stream Offshore Pipeline contract would be scrapped. Russia said the 40 billion euro pipeline link to Europe was to be dropped due to tension between the European Union and Moscow over the crisis in Ukraine.
Italian contractor Saipem has been awarded a $1billion contract in the Caspian Region by Daewoo Shipbuilding and Marine Engineering. The engineering and construction contract has been awarded through Saipem company ERSAI Caspian Contractor LLC.