Drilling contractor Helmerich & Payne has acquired Magnetic Variation Services (MagVAR), a directional drilling and wellbore optimization company.
MagVAR provides measurement while drilling (MWD) survey corrections by identifying and quantifying MWD tool measurement errors in real-time, improving directional drilling performance and wellbore placement.
Its technology has been successfully deployed in both onshore and offshore fields in North America, South America, Europe, Africa, Australia, and Asia. Founded in 2010, MagVAR will maintain its headquarters in Westminster, Colorado.
The financial terms of the acquisition were not disclosed. However, H&P did say that the transaction was in part consideration for MagVAR equity owned by two of its management members.
Namely, the company said last Friday that it granted certain management members restricted stock awards covering 213,904 shares of H&P common stock in aggregate, 163,993 shares to Stefan Maus and 49,911 shares to Shawn DeVerse.
“The restricted stock awards are not part of any existing Helmerich & Payne, Inc. equity incentive plan but are an inducement for the management members to assume and continue employment with H&P,” the company said.
Such restricted stock awards vest in three equal annual installments, generally subject to continued employment, with accelerated vesting occurring upon certain specified events.
John Lindsay, Helmerich & Payne president and CEO, said: “As the industry continues to drill longer lateral wellbores and unconventional drilling moves into the development stage, we believe accurate well placement becomes increasingly important to maximize field economics.
“Our investment in MagVAR underscores H&P’s commitment to providing the latest value-creating technology to our customers regardless of the drilling contractor.
“Adding MagVAR’s capability to Motive’s unique directional drilling technology generates a powerful software platform that creates a compelling value opportunity for E&P companies.”
Worth noting, H&P closed its acquisition of Motive Drilling Technologies in June 2017.
Maus, MagVAR’s founder and CEO, added: “Joining forces with H&P and Motive means our technology will have even greater potential to reduce positional uncertainty in the drilling process.”