Plexus CEO Ben van Bilderbeek is weighing fundraising choices to “lengthen the runway” for the enterprise, which has been confronted with years of losses however might now be on the verge of success.
Based mostly in Aberdeen, Plexus struck a significant settlement in November to license out its Pos-Grip wellhead know-how to the US oilfield big Schlumberger.
“Shock, shock – I believe no person imagined that we’d handle to do this”, Bilderbeek stated of the deal. Nevertheless, as issues stand, a lot wanted progress has been “slowed down” attributable to Covid.
Schlumberger is doing a diligence examine to evaluate the complete worth of the know-how forward of any tasks and, though the Plexus crew is “divulging the secrets and techniques” over MS Groups, Zoom and nonetheless else, they’ll’t at the moment comply with up in individual.
So Bilderbeek, the CEO, founder and largest shareholder, is his choices for Plexus, which, regardless of its revolutionary – and profitable – know-how, has seen “harrowing occasions”, reporting multi-million pound losses yearly since 2016.
In the meantime, a big “pipeline” of alternatives constructed up after promoting its rental “jack-up enterprise” to TechnipFMC in 2017 retains getting pushed to the precise.
So Plexus is “engaged on methods to increase that runway so we’re there when the market returns”, Bilderbeek stated.
“Each a kind of is transferring to the precise once more, once more, once more, delay, delay, delay.
“No choices are being made. Within the meantime, what we have to do is protect the supply of this know-how below my tutelage.
“We’ve this occurring now, and it’s all very troublesome for us as a result of progress will not be being made on the identical tempo as it might be.
“On the finish of the day, while you’re working adverse cashflow, progress is one thing you want immediately, you want now.
“In any other case it is advisable to increase cash in numerous methods, both contribute your individual capital in case you have it, or to lift cash out there, which is able to trigger nice dilution. Or maybe hibernating a enterprise till the world turns.
“These are the issues we now have to consider.”
“Shake the tree”
Nearly all of Plexus’ work is within the UK North Sea, however worldwide sources of earnings corresponding to drilling in Russia, has been a “casualty” of Covid.
The Schlumberger deal – topic to their approvals – would see the US oilfield providers agency be licensee of Pos-Grip via to 2030, with royalties to Plexus.
With so much using on that, Bilderbeek, who prides himself on “with the ability to persuade folks of my perspective”, desires to comply with up in individual.
Talking to EV from lockdown in Portugal, then, he’s discovering his idyllic settings removed from excellent.
“I used to be planning to step on a airplane and lease an condominium in Houston and spend three months round my new pals.
“Clearly I’m attempting to shake the tree, however I want I might be in Houston doing that.
“It is extremely troublesome to make the switch of know-how work with out with the ability to tackle this in individual.”
It’s removed from radio silence although, with common conferences with the Schlumberger crew, and Plexus is assured its “superhuman” know-how will communicate for itself.
The agency is aiming for Pos-Grip to develop into the brand new “trade normal” for wellheads and steel sealing designs.
It’s a “friction-grip” tech utilizing integral steel seals, that are externally pre-loaded in opposition to everlasting wellhead fixtures, making certain the wells are “gas-tight” throughout their lifecycle.
In 2015, Complete drilled what was believed to be the very best strain effectively ever drilled within the North Sea, Solaris, with a Pos-Grip wellhead.
The Technip sale in 2017 then additional “validated” the know-how, Plexus stated. It at the moment within the means of delivering a wellhead system to Spirit Vitality within the North Sea.
Pos-Grip additionally fights in opposition to CO2 and methane leaks – one thing Plexus hopes will play in its favour within the US because the local weather debate heats up, with Complete leaving the American Petroleum Institute (API) final month.
Nevertheless, companies’ lack of urge for food to innovate in years amid current downturns is one thing Plexus has “suffered from” up to now, Bilderbeek stated, and he’s conscious of the problem forward.
“Fairly often it’s greater than a job’s value to vary from one methodology of engineering to the opposite.
“However that takes convincing, as a result of folks like to stay with what they know.”
Bilderbeek additionally cited the API permitting standardised wellheads to be in-built parts “at quantity”, which may worth out Western producers.
Even then, although, Bilderbeek stated there’s no extra metal in Pos-Grip than typical programs and it has a “fraction” of the variety of parts, so “it might comply with that should you make them on the identical quantity it ought to be price-competitive”.
He added: “I do know what Pos-Grip can do and the way it compares. I do know what they’re going to be seeing.
“At this stage, I’m very very constructive.
“I additionally know that exercise ranges are selecting up in deepwater Gulf of Mexico.
“I’m a agency believer that this know-how has all the time spoken for itself and it’ll communicate for itself once more.”