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Established in 2007, TEK-Ocean (T3K) offers customers in the oil and gas, maritime, and renewable energy industries a comprehensive service offering.
This includes engineering, subsea, marine, logistics, consultancy and specialist oil and gas services.
It’s headquartered in Melbourne and has offices and operational facilities across regional Victoria and Perth. Its employees number more than 40 across its operations.
We sat down with Alex Biro, recently appointed Managing Director and CEO Tek Ocean to learn more about the company.
Alex welcome to TEK-Ocean, what can you tell us about your background and experience, and your agenda as appointed Managing Director and CEO of the company?
I’m both pleased and honoured to take on this role as the company is poised for a period of substantial growth and it is shaping up to be both an exciting and a positive experience.
I have over 35 years of local and international experience in the upstream and downstream subsea and offshore construction industry mainly in leadership roles.
Early in my career, I was working for a number of service companies in the Bass Strait, the Timor Sea and the NWS before consulting to energy operators all over Australia, West Africa, the UK North Sea, South East Asia and the USA. Some notable international projects include Xikomba/Kizomba ExxonMobil (Angola), Jubilee Tullow (Ghana), Liwan Husky (China) and most recently, Golfinho (Mozambique) LNG.
As MD and CEO, my goal is to harness the capabilities of this “can-do” company and really push hard into building it into a multi-vessel, multi-faceted operation that the broader energy community know as a trusted partner in delivering key energy infrastructure projects cost-effectively with innovative solutions.
I aim to double, triple revenue in the coming years building an enterprise that commands economies of scale to be even more competitive in the market. The key to this is having the right strategy, this means seeking out the available market, having the key people to expertly deliver and mix of assets either owned or available through strategic partnerships to respond to the increasing demand for decommissioning work and development of renewable energy.
What can you tell us about the core focus of TEK-Ocean and what is the company about?
We have three key focus areas; being expanding our decommissioning capabilities; broader involvement in offshore renewable energy projects; and growing our historical business of supporting energy providers through organic growth and M&A activity.
I understand Tek Ocean recently applied upgrades to your flagship ocean vessel TEK-Ocean Spirit, what does this mean for the company and its capacity to handle projects?
Quite simply it means that we can handle a broader range and of offshore projects. Whereas previously we operated the TEK-Ocean Spirit more as a supply vessel with light lifting capability we now have a very sophisticated piece of equipment on board that can handle a significantly greater range of projects.
Lifting heavy, sensitive and very expensive equipment to and from the seabed was always a complex operation and with a floating crane moving with the ocean it can be quite a challenge. Our crane dynamically compensates for vessel movement to ensure the lifting of key infrastructure is safe and reliable. Not many vessels have this capability in Australia, ours does.
What sort of projects have TEK-Ocean got on the go?
The vessel has a number of projects in the near term and on the horizon. As we speak the vessel is in Tasmania assisting the Marinus Link project with its geotechnical survey work. This is an essential project linking Tasmania to Victoria’s electricity grid. Once complete in March, the vessel will move on to additional geotechnical work for Beach energy in March/April followed by artificial reef installation work in Port Phillip Bay in April.
Each of these projects will utilise the 60T AHC crane. Going forward we have a number of leads in the pipeline for additional support to offshore energy producers and given our long history of successful project delivery in the local market we are confident we will have success securing additional charters for the Spirit.
With the company listing in 2021, how has it been tracking as a publicly listed company?
It has been very much a learning experience; both challenging and exciting. Obviously, we are a little disappointed with the current share price but we see this as a longer-term play with the market currently on the front of the expected upswing in offshore renewable energy projects and of course the requirement for many operators to decommission ageing infrastructure.
Our firm belief is that the current share price grossly undervalued and could be the result of trading thinly because we have only been listed on the ASX for around 6 months and most likely not known by the market well enough. Our achievements as private company were exemplary having realised good profits every year from the outset which reassures the market that the business model works which has a solid foundation.
Being has necessitated a change in mindset, we are no longer a privately held enterprise and are accountable to a wide range of shareholders. We have positioned the Company to embark along a path that will deliver strong growth be it organic or via acquisitions to deliver on our implicit promise to shareholders.
We know that we need to grow the Company, we know in which areas we wish to target, we are looking also at areas outside our traditional areas of expertise such as the onshore disposal of used subsea equipment. There is a lot of scope for growth and we will target those areas where we believe we are most competitive and can derive maximum benefit for our shareholders.
What can investors look forward to this year for TEK-Ocean and what is the pipleline ahead look like?
To use a sporting analogy, FY22 will be a tale of two halves. 1H FY22 was marked by two key activities: ASX listing and vessel dry docking and upgrades. These activities were necessary to position the Company for future growth but they come at a cost being the need to take the TEK-Ocean Spirit out of service for an extended period of time. But this is the investment in the future we were needing to make and we already have seen the fruits of this with new contracts for the vessel secured in late calendar year 2021 and early 2022 that would not have been available to the Spirit in its former capacity. 2H FY22 is already looking substantially better than the previous half year period.
Even the Company’s Q2 results with the vessel back in service late November were notably better than Q1. We see no reason why the Company will not exceed FY20 and FY21 revenues and even with a stretch exceed FY19’s record revenues.
With increased development projects on the horizon coupled with renewable, decommissioning and environmental rehabilitation projects, we foresee a major uplift in offshore activity that will surely put us in even a better market share servicing this upcoming $70 billion+ estimated value of projects in the next 10-15 years.
With our growth strategy we are well placed to realise our future business goals with our full range of our services and extensive capability – we continue to focus our business strategy providing and enhancing our clients with an integrated offer. This means, delivering a better service and experience for our clients and delivering higher margins and net profitability for the business.
