BW Offshore to Float Energy Unit

May 23, 2019

World Energy Reports LLC.

Oslo-listed BW Offshore said it will float BW Energy this year to help expand the oil and gas business, particularly in Brazil, as its first quarter earnings rose 72%.

Shares in BW Offshore, originally an owner of floating production, storage and offloading (FPSO) vessels operated on behalf of oil companies, were 17.6% higher at 60.6 Norwegian crowns by 0901 GMT on Thursday.

BW Offshore, whose stock has risen 94 percent year-to-date, has in recent years built up its oil and gas exploration and production business, with licences in Gabon, Namibia and Brazil.

"BW Energy ... will invite external investors into the company to finance development of the recently acquired Maromba field offshore Brazil and value-enhancing investments at the Dussafu Marin Permit offshore Gabon," BW Offshore said.

The company won permission from Brazilian regulators in March for its acquisition of Maromba from Petrobras and Chevron.

"We will also of course be looking for new projects, but we are primarily seeking funding for Maromba," BW Offshore Chief Executive Carl Arnet told Reuters.

He declined to say how much money he hopes to raise when BW Energy goes public, adding that it will depend of the planning process and the speed of the Brazilian development.

Shipping conglomerate BW Group Limited is BW Offshore's largest shareholder, with a 49.9% stake.

Value revealed
The spin-off of the energy business will make the value of BW's oilfields more evident to investors, Arctic Securities analyst Morten Nystrom said.

"The share is up for two reasons - they deliver good numbers, and they say they will spin off the oil and gas business ... People are starting to calculate what the oil and gas business is worth and will likely discover that this is a share that is undervalued. So this is very positive," he added.

Arnet and chief financial officer Knut Saethre will step down by the end of June to take up similar posts at BW Energy.

The company's chief operating officer, Marco Beenen, will be promoted to CEO, while senior finance executive Staale Andreassen will become CFO, BW Offshore added.

After years of low investments by oil firms the demand for FPSOs is likely to rise in coming years, further boosting the prospects of its remaining business, BW Offshore said.

The group's first-quarter earnings before interest, tax, depreciation and amortisation rose 72% year-on-year to $186.8 million, beating a forecast of $161 million in a Reuters poll.

DNB Markets and Pareto Securities have been retained as financial advisers for the IPO on the Oslo Stock Exchange.

(Editing by Simon Cameron-Moore, Jason Neely and Alexander Smith)

Floating Production Week delivers unrivaled overview, insight and analysis to the Offshore Floating Production Systems and Technology market

Floating Production Systems Report And Online Database

  • Monthly reports -- Our monthly reports provide a detailed snapshot of the business sector as of the middle of each month. More than 80 pages of data and industry analysis each month. Excel spreadsheets with each report enable subscribers to tailor the data presentation to their needs. In October of each year we provide a detailed five year forecast of production floater orders. In March of each year we fine tune the forecast and make revisions as needed.
  • Online database -- The online database is updated every day – with information direct from primary sources. In the database are details for 240 planned projects, 370 installations in service, 70+ floaters on order and 20+ floaters available. The database is fully searchable. Customized charts and spreadsheets can be directly produced from the database.
  • Customer support -- We are available to assist with technical questions about information in the database and reports -- and assist with any questions about using the database search tools.

Here's what you get!

Request a Free Sample Report