DELAYS on a flagship North Sea field have taken a toll on profits at Petrofac, the oil services giant which is a big employer in Scotland.
Petrofac said the Greater Stella development 175 miles east of the Granite City made a lower than expected contribution to earnings in the first half.
The Jersey-registered company told investors: “The Greater Stella Area development commenced production in February, although the ramp-up in production and our formal entry onto the licence has been slower than expected.”
The comment provides a reminder of the challenges Petrofac has faced on Greater Stella, which is operated by Aberdeen-based Ithaca Energy.
The field was originally due to start producing oil late in 2014 but the launch date was pushed back after delays in the completion of work in Poland on the giant floating production facility supplied by Petrofac for use on the field.
Petrofac sold an interest in the FPF to Ithaca under an arrangement which gave it the right to earn a 20 per cent stake in Greater Stella.
The company said the integrated energy services division which works on Stella is expected to achieve full year earnings of $80 million (£62.5m) to $100m before interest, tax, depreciation and amortisation.
In February the division was expected to achieve $140m to $160m EBITDA .
Chief executive Ayman Asfari noted the division had also been impacted by the weakness of oil prices and by reduced investment in Mexico. But Petrofac has been doing well. It has won $1.7 billion new orders since 1 January.
“The high level of tendering activity is evidence of greater confidence in our core markets and we continue to have a very good pipeline of bidding opportunities,” said Mr Asfari.
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