Augean signs joint venture agreement

Augean has signed a joint venture agreement with Scomi Oiltools (Europe) and its parent company Scomi Oiltools (Bermuda) to take a controlling stake in a new company formed from the existing operational assets of Scomi in the UK. The new company is to be called Augean North Sea Services.

Augean will pay £2.05m for a 70 per cent shareholding in ANSS, and provide a loan of £1m to allow Scomi to repay existing debt.

The total consideration of £3.05m is to be drawn from Augean’s existing £10m bank facility.

The joint venture will build upon the existing relationship between Augean and Scomi for the treatment of drill cuttings from offshore oil and gas exploration, using Augean’s thermal treatment and disposal facilities at Port Clarence and Scomi’s offshore waste management resources, based in Aberdeen.

By combining these activities through ANSS, the new venture will have the ability to source, treat, recycle and dispose of offshore wastes for its customers through an integrated waste management supply chain.

Paul Blackler, the chief executive of Augean, said: “The creation of Augean North Sea Services is an exciting step towards delivering Augean’s strategy of providing integrated waste management services to offshore operators in the North Sea. I am confident that this will create value for our shareholders and enhance the future opportunities available to the group.

“We are delighted to be building upon our existing relationship with Scomi and look forward to combining their established expertise in providing services to the oil and gas industry with Augean’s own core capabilities in the management of hazardous wastes. I would like to welcome all of our new colleagues at ANSS to the Augean group and look forward to working with them to develop and grow the business.”

The integration of the new business will take place during the second half of 2012 and this is expected to make a modest contribution to the results during that period.

Augean was advised by John Hamer, Emma Stubbs, Harry Singh, Ian Akitt and Ben Roden from Leeds-based law firm Walker Morris.