Kentz Corporation (LSE: KENZ), the holding company of the Kentz Engineering and Construction Group, has announced an agreement with the Dome Group, a leading supplier of equipment and services to the Middle East energy sector. The framework agreement results in Kentz taking a 49 per cent interest in Dome General Contracting Company Ltd. (Iraq) for an undisclosed sum.
Kentz and Dome have previously worked together on tendering and delivery of Engineering, Procurement and Construction (EPC) projects for oil and gas infrastructure and production plants in the Middle East, including Iraq. Dome and Kentz are currently working together on the design and construction of an onshore production facility in Yemen for an international oil company.
Iraq has the third largest proven oil reserves in the world and 12 service contracts were signed with international oil consortia following two successful petroleum licensing rounds in 2009. These contracts are expected to add 10 million barrels a day of capacity to Iraq's existing production of 2.5 million barrels a day by 2017. Kentz and Dome are actively pursuing EPC project opportunities in Iraq with many of the newly established operating companies.
Shares in Kentz ended the day unchanged at 243p.
Hugh O’Donnell, chief executive of Kentz Group commented: “We are delighted to have signed this agreement with Dome, which allows us to build on our existing relationship with them in the Middle East and position Kentz/Dome to deliver project solutions to Iraqi operators, many of whom are existing clients.”
Talal Daair, Managing Director of Dome Group added: “We are very pleased to extend our relationship with Kentz to pursue the new exciting opportunities in Iraq which has always been one of our core business areas.”