Norway’s OBX Oil Service Index climbed to the highest level in a week in Oslo amid signs of an improved market outlook in Brazil and after an increase to oil and gas spending estimates off Norway.
The nine-member Oslo Boers OBX Oil Service Index rose to as high as 113.84, the highest intraday level since June 11. The index traded at 113.71 as of 12:10 p.m. in the Norwegian capital for a fourth day of gains.
A potential easing of pre-salt licensing rules in Brazil “would be a major game changer,” Kristoffer Riis Iden, an analyst at Arctic Securities ASA, said in a note today. If the restrictions are changed, or even removed, seismic companies would be the first to benefit from an increase in exploration and production, he said.
With fields maturing and finds more difficult to develop, demand is rising for the seismic, drilling and subsea services offered by companies such as Aker Solutions ASA, Subsea 7 SA, and Seadrill Ltd. as energy companies extend the search for resources into deeper and more remote parts of the world.
Aker Solutions, which has expanded its operations in Brazil, is well-positioned to deliver the locally produced goods and services needed to win deals in Brazil, according to Riis Iden. The Oslo-based company said on March 27 it had won a 4.6 billion-krone ($801.4 million) deal to provide subsea equipment to Petroleo Brasileiro SA.
Oil and gas investments off Norway will rise to a record 211.3 billion this year from 172.5 billion kroner last year, Statistics Norway said today, citing estimates based on a survey of operators. That compares with the statistics agency’s previous estimate of 198.7 billion kroner.
Electromagnetic GeoServices ASA, which said on March 21 that it had signed a deal with Spectrum ASA to expand its coverage of the waters off Brazil, was the biggest gainer in the oil service index.
TGS Nopec Geophysical Co. was the biggest loser after Folketrygdfondet cut its stake to less than 10 percent. Aker Solutions gained 0.6 percent and Prosafe SE rose 0.7 percent.