Oceaneering (OII) Secures Multiple Contracts Worth $200 Million
Oceaneering International, Inc. OII revealed that its Manufactured Products segment clinched multiple contracts during the fourth quarter of 2023. These contracts, valued at approximately $200 million, highlight OII's prowess in providing cutting-edge solutions to international oil and gas operators and marine construction companies.
Key Contracts
Gulf of Mexico Development: Under one significant contract, OII is set to embark on a large-scale, high-quality, greenfield development situated in the Gulf of Mexico. The scope of work involves the supply of electro-hydraulic, steel tube umbilicals spanning approximately 34 kilometers and supporting subsea distribution hardware. Production will take place at the Panama City, FL, and Houston, TX, facilities, with final delivery slated for the third quarter of 2026.
Black Sea Staged Development: The second noteworthy contract is tied to the next phase of a staged development in the Black Sea. OII's responsibilities include providing electro-hydraulic, steel tube dynamic and static umbilicals, covering an area of about 45 kilometers and supporting subsea distribution hardware. Production is scheduled at the Rosyth, Scotland facility, commencing in 2024, and concluding with final delivery in the third quarter of 2025.
Additional Contracts: In addition to the aforementioned contracts, the fourth quarter of 2023 saw OII secure contracts for the supply of additional subsea production umbilicals and umbilical termination hardware. These contracts also included Grayloc and Rotator products, along with mobility solution products.
Significance of Contracts
The contracts secured by OII in the fourth quarter of 2023 are not only a testament to the company's capabilities but also signify the ongoing necessity for stability in global offshore energy production. With a focus on delivering unique work scopes in a safe and timely manner, OII is well-positioned to meet the industry's evolving demands.
CEO Perspective
Rod Larson, president and chief executive officer of Oceaneering International, expressed confidence in these contracts, highlighting the critical role they play in ensuring stability in global offshore energy production. Larson pointed out that these awards leverage OII's extensive expertise, reinforcing its position as a leading provider of high-quality integrated products and services to both energy and non-energy markets.
Industry Impact
The global offshore energy sector is witnessing a transformative phase, and OII's strategic contract wins further solidify its role as a key player. These contracts not only contribute significantly to the company's revenues but also bolster its position in the industry.
Future Prospects
OII's successful bids for these contracts set the stage for a promising future. As the company continues to demonstrate its commitment to excellence, it is likely to attract further attention from both existing and potential clients. The anticipated revenues from these contracts provide a strong foundation for OII's growth trajectory in the coming years.
In conclusion, Oceaneering's announcement of having secured multiple contracts in the fourth quarter of 2023 is a testament to its leadership in the offshore energy industry. The company's ability to secure contracts of varying scales, from large greenfield developments to staged projects, showcases its versatility and expertise. With a commitment to safety, quality and timely delivery, OII is positioned to make significant contributions to the global offshore energy landscape.
Zacks Rank and Other Key Picks
Currently, OII carries a Zacks Rank #1 (Strong Buy).
Investors interested in the energy sector might look at some other top-ranked stocks like Subsea 7 S.A. SUBCY and Energy Transfer LP ET, both sporting a Zacks Rank #1, and Murphy USA Inc. MUSA, carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Subsea 7 is valued at $4.04 billion. The company currently pays a dividend of 38 cents per share, or 2.87%, on an annual basis.
SUBCY offers offshore project services for the energy industry, specializing in subsea field development, covering project management, design, engineering, procurement, fabrication, survey, installation and commissioning of seabed production facilities.
Energy Transfer is valued at $45.07 billion. The company currently pays a dividend of $1.25 per share, or 8.72%, on an annual basis.
ET is an independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas.
Murphy USA is valued at around $7.62 billion. In the past year, its shares have risen 39.4%.
MUSA is involved in the marketing of retail motor fuel products and convenience merchandise, operating retail stores under the brands Murphy USA, Murphy Express and QuickChek.
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