Valor PPA Ltd, a specialist growth engine, has officially launched with the acquisition of Aberdeen based firm Cavitas Energy.
The Aberdeen-based growth engine which started in August 2017, has opened its doors with the purchase of enhanced heavy oil recovery specialist Cavitas Energy. A seven figure investment has ensured that Valor have added, what they call “a key player” to their acquisition strategy and overall offering as a group.
Aiming to bolster Valor's proposition by adding further business to the group, the strategy will see additional acquisitions of complimentary energy companies to achieve a group revenue target of over £25 million by 2023. Valor has been created by Scottish industry experts who believe that the time is right to form such a group which will prove highly beneficial for not only the companies themselves, but their clients also.
Valor said that “we have eagerly anticipated the Cavitas deal, and feel that it is a great fit for Valor, being fully aware of the capabilities that the team hold. As North Sea production declines, heavy oil is growing in strategic importance. Heavier crudes are expected to account for 42% of UKCS oil production by 2025. With the industry focussing on production improvements and Maximising Economic Recovery, we believe Cavitas holds the key to supporting both of these challenges”.
Cavitas, who specialise in enhanced oil recovery technology, introduced their Thermal Heavy Oil Recovery (THOR) downhole tool with a view to help increase recovery of heavier crudes and assist in unlocking what the Oil and Gas Authority predicts may be as much as 9 billion barrels of heavy oil within the UKCS. Globally heavier crudes are estimated to account for around 40% of existing known reserves.
Steve Johnstone, Managing Director of Cavitas Energy said: “We are delighted to become part of the Valor group of companies, this investment allows us to fast track our development of THOR with a view to launching in the UKCS and other globally strategic heavy oil producing regions.
Although recent Oil price increases have been seen, the previous low since 2015 has forced the North Sea Oil and Gas sector to reset its cost structures and has created a strong demand for reduction in cost of uplift, and improved production methods. Cavitas believe that the solutions they provide will offer a two pronged approach to these challenges. Steve comments: “Thermal EOR processes have the greatest certainty of success and application in about 70% of the EOR market globally. Our team are excited to advance our efforts with the backing of Valor, and look forward to working with our customers to solve some of the challenges they face”