Is Cooperation The Preferred Strategy for Companies To Survive?

European companies are increasingly looking at cooperation opportunities to decrease costs. This growing trend most recently saw cooperation with neighbouring countries such as Kazakstan. 

UK-focused Egdon Resources is an example. Announcing its interim results for the six months ended 31 January 2015, the company clearly voiced its intention to team up with larger operators.  

“We have continued the development of our Northern England unconventional resource exploration portfolio, with the exercise of our option on PL161 and PL162 and ongoing detailed assessment of the acreage acquired from Alkane Energy.  We have seen a further high value farm-out deal between IGas and INEOS in recent weeks and Egdon continues to review the best timing to introduce a suitable funding partner into our high quality unconventional resource acreage” Philip Stephens, Chairman of Egdon, commented in a note released on Tuesday. 

Egdon reported a 35.5% decrease in oil and gas revenues to £0.91 million in the six months. 

The forms of cooperation are also increasingly common amongst bigger companies.

Also on Tuesday, Statoil announced it will increase cooperation with Eni Norge, Lundin Norway, OMV and GDF Suez to solve ‘operations tasks tied to exploration in the Barents Sea.’

The focus on costs was in equal parts the reason leading to the decision of KazMunaiGas to create a joint venture with drilling company Nabors. 

‘The new joint venture will carry out drilling operations in the Tengiz field under the current work program, as well as future expansion project’ reads the note released on Tuesday. 

Earlier this year, FMC Technologies and Technip signed an agreement of form a 50/50 joint venture to launch their new project Forsys Subsea.