Schlumberger to form subsea production JV with Aker Solutions and Subsea 7

Schlumberger has agreed to create a joint venture (JV) with Aker Solutions and Subsea 7 with the objective for driving innovation and efficiency in subsea production by enabling customers in unlocking reserves and cutting down cycle time.

The JV will combine a portfolio of innovative technologies that include subsea gas compression, electrification capabilities, and all-electric subsea production systems that enable customers in meeting their decarbonization targets.

It will club together the subsea businesses of Schlumberger and Aker Solutions. These include a deep reservoir domain and expertise in engineering design, a subsea production and processing technology portfolio, manufacturing scale and capabilities, and a suite of life-of-field solutions for customers around the world.

Subsea 7 will have an equity stake in the new joint venture.

Schlumberger to form subsea production JV with Aker Solutions and Subsea 7. Photo courtesy of WhisperToMe/Wikipedia.org.

Olivier Le Peuch — Schlumberger CEO said: “As investment in the offshore market—particularly in deepwater—continues to increase, our customers will benefit from enhanced services that leverage digital and technological innovation to drive improved subsea asset performance while increasing energy efficiency and reducing CO2 emissions.

“We look forward to collaborating with both Aker Solutions and our subsea integration partner Subsea 7 on this new venture.”

After the joint venture is finalized, the current Subsea Integration Alliance (SIA) between Subsea 7 and Schlumberger, will be modified so that the new joint venture will assume the latter’s role in the alliance, which will be renewed for a term of 10 years.

Apart from offering its subsea business to the joint venture, at the closing of the deal, Schlumberger will issue $306.5 million worth of shares to Aker Solutions in a private placement. Simultaneously, Subsea 7 will buy its 10% stake in the joint venture for $306.5 million in cash from Aker Solutions.

The joint venture will also issue an $87.5 million promissory note to Aker Solutions.

In the joint venture, Schlumberger will hold 70%, while Aker Solutions and Subsea 7 will own 20% and 10% stakes, respectively.

Øyvind Eriksen — Aker ASA President and CEO said: “Aker Solutions, Schlumberger and Subsea 7 are complementary businesses, both in terms of products and services, as well as customers and geographical presence.

“Furthermore, Schlumberger shares our commitment to innovation, such as deploying digital solutions and decarbonization technologies.”

The deal, which is subject to receipt of regulatory approvals and other customary closing conditions, is likely to be finalized in the latter half of 2023.