PDM - How much of Fugro’s business is in oil and gas today?
Ruegg - Oil and Gas is our mainstream business sector - with around 55% of our revenues. While most of our involvement has been in geotechnical and survey-related activity, we have been moving in from the fringe of E&P activity - notably with our Geoteam acquisition. But generally we are pleased with our mix of oil and gas and other activities. This diversification has protected us from the cyclicity of the oil and gas business.
PDM - What interested you in Robertson?
Ruegg - We have been observing the way the oil industry is evolving, with consolidation in the super-majors and a trend towards outsourcing. We see a bright future for companies involved in providing services and consultancy to such organizations. The Robertson acquisition strengthens our position in niche markets for geoscience services to the oil and gas industry. Robertson’s geophysical services will enhance our existing seismic acquisition and processing services.
PDM - These are mostly focused on site survey?
Ruegg - No, we have three 2D boats and one 3D boat for full-scale seismic acquisition. We also have a limited seismic processing capability - which will be enhanced with Robertson’s technology.
PDM - We understand that Robertson will become part of your Survey division. Do you have any plans to change your organization to reflect your increasing oil and gas activity?
Ruegg - We have no immediate plans, but we may create a new division in the future to reflect this evolution.
PDM - How will you run Robertson ?
Ruegg - We will keep the existing management structure and Robertson will continue to operate from its North Wales location. Fugro has a strong belief in a decentralized organization. We will be looking into possible synergies between our geophysical processing activities.
PDM - Fugro stock slipped from an all time high following the announcement. Sounds like the investment community were skeptical of the acquisition?
Ruegg - Yes, we were very surprised by the slippage, but the stock price has come back a bit since then.
PDM - The Robertson acquisition only cost around 10% of Fugro’s pre-acquisition turnover. Do you have any plans to further strengthen Fugro’s oil annd gas involvement?
Ruegg - There are a few things in the works we can’t talk about right now. But we are very bullish about the oil and gas sector.
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