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Saipem (SAPMF) Wins Major Subsea Contract Offshore Azerbaijan

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Saipem S.p.A (SAPMF - Free Report) , an Italian oilfield services provider, has entered into a framework agreement with an oil major, BP plc (BP - Free Report) , to provide subsea services in Azerbaijani waters. The agreement was signed between BP and a consortium consisting of Saipem, BOS Shelf and BOS Shelf International FZCO.

The contract involves carrying out offshore activities in the Caspian Sea, using the SCV Khankendi vessel, which is an advanced subsea construction vessel owned by the Shah Deniz consortium.

While Saipem will operate the vessel and provide the crew for the execution of subsea activities in the Shah Deniz and Azeri-Chirag-Gunashli fields, the consortium will carry out the engineering, procurement, construction and installation of subsea infrastructures. The consortium is also responsible for providing life-of-field services.

The framework agreement has an aggregate value of $300 million, which includes the value of the services that the consortium can provide upon the customer’s request, of which Saipem’s share is $250 million. The initial duration of the contract is three years, with an option to extend it by another two years.

The recent contract between BP and Saipem reinforces their long-term commitment to work together in the region.  The SCV Khankendi vessel was alloted to Saipem for operational management under an agreement with BP (in 2016). This agreement involved the execution of offshore activities in the Shah Deniz field.

Zacks Rank and Other Key Picks

Currently, SAPMF carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the energy sector areSM Energy (SM - Free Report) and Hess Corporation (HES - Free Report) . SM Energy presently sports a Zacks Rank #1 (Strong Buy), while Hess Corporation carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

SM Energy is an upstream energy firm operating in the prolific Midland Basin and the South Texas regions. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.

Hess is a leading upstream energy company with its operations focused on the prolific resources offshore Guyana. The company has made significant oil discoveries in the Stabroek Block, off the coast of Guyana. Hess is currently in the process of being acquired by energy supermajor Chevron in an all-stock deal that will result in the creation of an energy behemoth with a massive portfolio of producing assets.


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