ROVOP, the independent subsea remotely operated vehicle (ROV) services company, is gearing up for continued development of its fleet and international expansion after securing £10m of funding from BGF in April 2015.
The announcement of the deal came as Fergus Ewing MSP, the Scottish Government’s Minister for Business, Energy & Tourism, officially opened the company’s new £4.2m headquarters in Westhill, Aberdeenshire. The 18,500 sq ft site allows ROVOP’s fleet of ROVs to be managed from one integrated hub and includes its proprietary training academy, ROV simulator, offices and underwater ROV test facility.
ROVs are tethered, unmanned underwater vehicles used by the offshore oil and gas and renewables industries to carry out a wide range of tasks to support wind farm cable lay and on-going inspection; drilling operations; subsea construction; survey and the inspection, repair and maintenance of subsea pipelines, platforms and other infrastructure.
ROVOP was founded in September 2011 and since then has invested more than £40m in its fleet of ROVs while building a strong reputation for quality, reliability and safety. ROVOP is 100% focused on ROV services and therefore provides genuine expert capability to its growing client base. The investment from BGF allowed the company to continue to grow its fleet of ROVs with a capital expenditure programme that would see the expansion of the fleet to around 50 ROVs over the next three years, operating globally.
Earlier in April 2015, the company opened its western hemisphere headquarters in Houston, Texas, hiring experienced industry experts Scott Wagner, Brett “Gonzo” Eychner and Wayne Betts to lead the business, which has already served customers in both North and South America.
Mike Sibson joined the ROVOP board as investor director for BGF.
Oil & gas executives gather in Aberdeen
In April 2015, 35 experienced non-executives from the oil and gas community gathered in Aberdeen to hear from Sir Nigel Rudd, chairman of BGF, and to discuss the challenges of managing high growth and entrepreneurial companies.
The group discussed the common challenges of chairing businesses which are growing rapidly, the importance of getting the right relationship between an owner-manager and the chairman, and some of the skills that make a good chairman in a smaller company environment.
The dinner was held at the iconic Silver Darling restaurant on the Aberdeen harbour front, and was jointly hosted by BGF and FWB Park Brown, a leading executive search firm in Scotland and in the global oil and gas industry.
The 35 guests represented over 100 current non-executive appointments, including a range of owner managed, investor backed and public companies. A number of the guests commented that this is the first forum for non-executives in Aberdeen, and highlights the desire of both BGF and FWB Park Brown to work in partnership with the non- executive community.
Mike Sibson, who leads BGF’s investment activity in the Aberdeen office, highlighted the fact that introducing experienced non-executive directors to companies is a key part of BGF’s model.
“A core objective for BGF is to make a difference to the businesses in which we invest. The central plank of how we do this is the introduction of a chairman or non-executive director who knows the industry, who understands the business, and who has been through some of the challenges of growing an entrepreneurial business before. To date we have introduced over 70 chairmen and non-executives to our portfolio companies, and in our experience it has the potential to be transformational for the business.”
Leading international geoscience businesses merge to create the Task-Fronterra Group with BGF funding
BGF’s latest investment in Scotland has supported the combination of two leading geoscience businesses, both focused on the oil and gas sector. Aberdeen-headquartered Task Geoscience and Houston-headquartered Fronterra Integrated Geosciences have joined forces to become a global geoscience consultancy – the Task-Fronterra Group. Task-Fronterra has received a financial injection of £3.8m of growth capital investment from BGF, which will take a minority stake.
Task Geoscience was founded in 2001, and Fronterra in 2003. Both are independent geological consultancies providing data processing, borehole interpretation and reservoir modelling services to the major operators in the oil & gas industry. The merger has created the largest independent geoscience company specialising in the use of borehole imaging and core integration, which allows it to improve clients’ understanding of oil and gas reservoirs through analysis of the well bore geology and surrounding faults and fractures. Task-Fronterra has a global footprint, with 10 offices across North and South America, Europe, the Middle East and Asia Pacific. The combined business benefits from the knowledge of more than 80 of the most experienced geoscientists in the field.
Task-Fronterra will be run by the founder and CEO of Task, Lawrence Bourke, who is supported by a senior management team from across both businesses. In addition two senior non-executives, Will Davie and John Forrest, have joined the board. Will Davie brings over 30 years of experience in the oil and gas industry including geosciences, with numerous senior management positions within Schlumberger. John Forrest was previously MD of Talisman’s North Sea business, before which he held several senior roles at Mobil.
Geoscience analysis and interpretation is key to understanding oil and gas reservoirs, which in turn is critical in making extremely valuable decisions on how best to maximise the returns from exploration and production activity. Task and Fronterra are the two market leaders in the sector, and enjoy complementary skills and geographical coverage. Furthermore, the complementary expertise provides the opportunity to assist clients across the world with their understanding of mature reservoirs, carbonates, deep-water fields, and unconventional hydrocarbons. In particular the Integrated Shale Gas Workflow, driven from Task-Fronterra’s understanding of the relevance of fracture networks to productivity of shale gas wells, has been pioneering in the industry.
Task-Fronterra’s proprietary software, attitude, allows clients to analyse and visualise surfaces within and between wells in a unique and intuitive manner. The use of Task-Fronterra’s unique workflows, together with interwell analysis using attitude allows the identification of sub seismic faults and fault systems which can improve certainty in Enhanced Oil Recovery (EOR) and reduce the risk of poor well positioning with respect to faults. This is important in mature basins such as in the North Sea where poor EOR well placement can result in early water breakthrough.
CEO of the Task-Fronterra Group Lawrence Bourke, commented: “Task and Fronterra share the same culture of constantly leading our scientific field, and always putting our clients first. Task has driven innovation in borehole image analysis and in software tools for interpretation, while Fronterra is the leading presence in analysing shale gas well bores. The combined business will offer more opportunities for our people as well as providing a broader service to our clients and I’m excited about working to bring together two highly talented workforces and creating new jobs in the future as the company grows.”
“BGF has already invested considerable time visiting our US operations and brings a strong understanding of our business and vision. Its growth capital investment and intellectual capital provide a strong opportunity for our business.”
Mike Sibson, BGF’s Investment Director who has joined the Task-Fronterra Group board, said: “Both Task Geoscience and Fronterra Integrated Geosciences have excellent reputations in the industry, and this is a really exciting opportunity to back a powerful combination. The people in both businesses are market leading in their fields, Lawrence has grown and sold a similar business before, and with senior input from Will Davie and John Forrest we have a really strong board to help the team deliver on their plans.”
Specialist oil and gas service provider SPEX Group looking to make a bigger bang with £5m BGF investment
BGF continued to support the UK’s growing oil and gas services sector when it backed SPEX Group in March 2014. SPEX is an Aberdeen-headquartered oil and gas service provider and was looking to accelerate its expansion in international markets and accelerate its technology development with a £5m growth capital investment from BGF. This was BGF’s fourth investment in Scotland this year.
SPEX, which in 2013 won the prestigious PWC/HSBC Technology Innovation of the Year award and the Northern Star Business Award for Commitment to Innovative use of R&D, was founded in 2009 to provide specialist services to the offshore industry, including explosives, cutting, punching and abandonment capabilities. The group has steadily grown to include the Innovation Centre, a fast-track design and prototyping service which offers unique design and technology development expertise to industry, and SPEX Production for rapid machining utilizing state-of-the-art large Mazak CNC machines.
Clients are using the unique SPEX in-house capabilities to design, develop, test and manufacture ground-breaking energetics and non-energetics technologies for a range of applications, and include solutions to solve some of the industry’s biggest challenges.
In September 2013 SPEX also secured fourth place on the Sunday Times Hiscox Tech Track 100 league table for the first time, making it one of only four companies headquartered in Scotland to make it on to the league table which ranks Britain’s private technology, media and telecoms (TMT) companies with the fastest-growing sales over three years.
Employing more than 60 staff, the business operates globally from Aberdeen, and has a strong presence in the North Sea. It has an expanding international footprint having worked in more than 20 countries and has recently invested in opening new operations in the US, Mexico and Saudi Arabia. SPEX’s expansion into Saudi Arabia will support the company’s wider growth plans in the Middle East where there is huge potential for its services.
BGF’s investment is enabling SPEX to continue to accelerate growth to meet demand and allow SPEX to invest in the development of its own tools and technologies with Third Party customers and recruit service personnel for the international expansion of its downhole services business. BGF took a minority stake and BGF Investment Director, Mike Sibson, joined the SPEX board. Banking facilities are provided by Bank of Scotland.
CEO and founder of SPEX, Jamie Oag, explained:
“SPEX has a unique blend of technology and capabilities in-house. We provide these services for major customers, with an increasing international footprint. At the same time we are applying the same expertise to some real and urgent customer problems in the oil and gas industry. The financial support from BGF can speed up our response, allowing us to invest in people, tools and manufacturing equipment while allowing SPEX to maximise the potential of existing technologies that the company believes will be transformational for well control.
“BGF’s combination of capital and support was perfect for SPEX, and we are very pleased to welcome them on board.”
Mike Sibson, BGF’s Investment Director, said:
“We are delighted to invest in SPEX. It is a great fit for BGF. SPEX has built an excellent position based on a unique set of skills, and has exceptionally strong engineering capabilities. It is an ambitious team with a vision to build an international business. We look forward to working together to achieve the vision. BGF started the year with great momentum, and SPEX is our fourth investment in 2014. We have a strong pipeline of opportunities for the rest of the year.”
BGF’s first investment in a business located in the East of England was in energy-focused firm 3sun Group, a specialist provider of products and services to the global energy industry.
Founded in 2007 by Graham Hacon, 3sun Group operates in the offshore wind and oil and gas sectors. It is an established service provider to offshore wind farms, providing installation, inspection and maintenance services. In oil and gas, 3sun manufactures, installs and maintains control panels for offshore subsea and topside applications.
3sun Group secured the £10m BGF funding following six years of consistent growth. The Group has continued to grow rapidly, now employing 240 people and 31 apprentices across its headquarters in Great Yarmouth, and its bases in Aberdeenshire, Bergen, Norway, Lubeck, Germany and Esbjerg, Denmark. The Group is on track to deliver revenue in excess of £30m in the current year.
The investment of growth capital from BGF, alongside the appointment of Les Dawson, former CEO of Southern Water and Chairman of Murphy Group, as non-executive Chairman, has supported 3sun Group’s plans to accelerate expansion in its Great Yarmouth base and advance further opportunities in the UK and northern Europe. The group have also recruited an experienced COO and in 2015 completed the acquisition of AID Training, further enhancing their leading training capability.
3sun Group is well placed to benefit from strong growth dynamics in its target markets. The offshore wind market is forecast to grow dramatically, both in the UK as maintenance contracts become available for Round 2 turbines and Round 3 construction commences, and in northern Europe.
Oil and Gas software and services business set for growth with BGF investment
Petrotechnics is the global leader of software solutions to improve frontline operational performance and risk management in hazardous industries.
Based in Aberdeen and with offices in Houston, Saudi Arabia and Singapore, Petrotechnics was founded in 1990 and since then has pioneered proven solutions and successfully helped organizations in hazardous industries increase operational performance and improve risk management in the riskiest part of their operations.
Petrotechnics’ software solutions are used on a daily basis by more than 50,000 personnel from some of the biggest businesses in the oil and gas industry, including the three largest independent Oil & Gas Companies. Petrotechnics software is used in frontline operations across 385 sites on 6 continents. 80% of North Sea and 40% of Gulf of Mexico assets utilise Petrotechnics’ software to help manage their frontline operations safely and efficiently.
BGF’s £6m funding will help fuel the next stage in Petrotechnics’ growth strategy, enabling expansion into new geographies, recruitment of more people, and ongoing investment in the software products.
Petrotechnics’ enterprise software platform, ‘Proscient’, manages the execution of frontline work safely and efficiently to help organisations maintain the integrity of their assets, the safety of their workforce and the sustainable achievement of their production targets. This is a step change for the oil and gas industry, integrating safety, risk management, work planning and efficiency for the first time.
Proscient is designed to reduce the number and length of unplanned plant shutdowns, decrease permit and contractor wait times, more efficient turnarounds, significantly improve plan accuracy and plan attainment and engender a safety culture within an organisation.
Over the past five years the company has generated annual revenues in the range of £10-15 million and has employed more than 100 staff.
Before founding Petrotechnics, CEO Phil Murray worked internationally for BP for 10 years in a variety of technical, operational and managerial roles. The business has won a number of industry awards from organisations including winning the ‘Growth Strategy of the Year’ award at the European Business Awards in 2008.
BGF Investment Director Mike Sibson joined the Petrotechnics Board.
The advisers to the transaction were AAB, KPMG, Burness, Paull & Williamsons, Raeburns and Intuitus.