Premier Hytemp marks its 30th anniversary today and in this post we reflect on three decades of work with the global oil and gas industry and what the future might hold.
Since 1985, we have developed to become a global market leader in the manufacture and supply of engineered metal solutions to the oil and gas industry. In our first year we focused on rough out forgings and black forgings with machining, heat treatment and testing initially subcontracted. Within a year we had brought machining in-house, signalling a commitment to service development that remains at the core of our business today.
As an approved global supplier of wellhead and christmas tree components, valves and downhole tooling to the major original equipment manufacturers and leading service companies our reputation is founded upon our engineered solutions to complex supply requirements, innovative processing of materials and our ability to consistently meet challenging lead times. Today, our ability to manufacture and manage materials and components across the whole supply chain is at the heart of our investment and long term growth programme.
We are particularly proud that 30 years on from our start up, we still work with many of the same clients, including Cameron and GE Oil & Gas, and continue to forge long-term, mutually beneficial partnerships with customers worldwide, servicing their complex needs from our state-of-the-art facilities in the UK and Singapore.
Of course, oil and gas is an industry renowned for its cyclical nature and within a year of our foundation we saw the oil price collapse of 1986, the culmination of a six-year price decline resulting from oversupply in the market. Over the years we have worked through the industry’s peaks and troughs and here our chairman, Maurice McBride, an industry veteran of more than 35 years’ standing, reflects on the current market, its challenges and opportunities.
“In an industry driven by exploration, development and technological innovation, it is remarkable how a combination of industry, economic and geo-political factors has kept us in a cycle of supply and demand issues over the past 30 years. Today, the industry faces the ramifications of perhaps the most significant price realignment since 1986 and it is clear that a major resetting of the dial in terms of opex and capex is required to ensure long term viability,” said Maurice.
“The supply and demand equation is out of kilter, with production up in key regions but demand falling as major developing economies slow. It is also true that the world is beginning to learn to live without hydrocarbons due to the growth of renewables. Despite the current challenges, E&P activity will continue as the NOCs need petrodollars to finance their domestic economies and the IOCs strive to maintain profitability and deliver dividends to their shareholders. The common issue is that costs have to come down.
“At a strategic level, the industry will have to look at new and different ways of working to achieve sustainable cost reductions with standardisation of equipment being a major area of opportunity. For example, the industry has come to a point where almost every wellhead or Christmas tree component is bespoke. Achieving standardisation to a handful of designs could deliver significant cost savings.
“At Premier Hemp, we embarked upon a significant programme of rationalisation and investment to meet the future needs of our customers before the oil price collapse with the aim of being more efficient, enhancing our business processes and developing capacity and our turnkey service offering with the latest technology. This has put us ahead of the curve in terms of weathering the current storm and giving us the flexibility to work through the cycle with our clients. While there are clearly more hard times ahead, we remain optimistic for the medium to long term prospects for the industry and are ready to work through the next phase of the industry’s evolution with our customers and partners.”