OIL and gas sector followers may have mixed feelings about the latest announcement from the Aberdeen-based giant that has shortened its name to Wood from Wood Group.
In an update on trading in 2017, Wood said it has been making great progress with the integration of the Amec Foster Wheeler it acquired in a £2.2 billion deal that completed in October.
Directors appear increasingly confident the deal will deliver the hoped for revenue and cost synergies.
The enlarged firm will work in more engineering markets and countries and be much less reliant on serving the hard-pressed oil and gas industry than what it refers to as heritage Wood Group was.
The scale of the change is underlined by the fact the North Sea got only a passing mention in yesterday’s update, in connection with a pipeline system contract.
The update gave no details of trading in an area that now accounts for less than 10 per cent of Wood’s business, against around 40 per cent five years ago. With chief executive Robin Watson intent on Wood keeping its headquarters in Scotland, the country should benefit if his diversification drive works.
But the fact Wood made its move on Amec Foster Wheeler to reduce its reliance on the North Sea oil and gas trade will only heighten concern about the outlook for one of Scotland’s key industries.
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