10/03/07 - Deep Down Announces Over $30 Million in Flotation Orders
HOUSTON, TX – October 3, 2007 – Deep Down, Inc. (OTCBB: DPDW) announced today that it has secured over $22 million in drilling riser flotation contracts for Matrix Asia Pacific Pty Ltd of Perth, Australia, and expects to close over $8 million in additional contracts within the next couple of weeks.
Deep Down has an exclusive agreement with Matrix to introduce their complete product line to the U.S. Market. These contracts establish Matrix as one of the world’s premier suppliers of syntactic foam drilling riser flotation modules. These modules are used to provide buoyancy and reduce the weight of the riser string, thus allowing drilling in deeper depths with less tension.
Matrix is providing their proprietary syntactic foam formulation, coupled with a practical, damage resistant module design. Deep Down is working closely with Matrix to optimize the mix of products and services that can be jointly offered to the marketplace. Deep Down is currently acting as an agent and expects to earn over $600,000 in commissions, after expenses, on these orders.
“Although Deep Down will not record the revenue on its financial statements, it is important to note that the $600,000 in commissions is essentially unencumbered by expense and falls to the bottom line as pretax profit. We expect these fees to be collected in various installments over the next 18 months,” commented Eugene L. Butler, Deep Down’s chief financial officer.
In addition to drilling riser flotation, Matrix offers buoyancy for ROVs, subsea deployment, distributed buoyancy modules and other subsea applications. Matrix also offers a complete range of molded polyurethane products including, bend restrictors, bend stiffeners, VIV suppression strakes, clamping systems, and cable and flowline protection.
About Deep Down, Inc.
Deep Down specializes in the provision of innovative solutions, installation management, engineering services, support services, custom fabrication, and storage management services for the offshore subsea control, umbilical, and pipeline industries. The company fabricates component parts of subsea distribution systems and assemblies that specialize in the development of subsea fields and tie backs. These items include umbilicals, flow lines, distribution systems, pipeline terminations, controls, winches, and launch and retrieval systems, among others. Deep Down provides these services from the initial field conception phase, through manufacturing, site integration testing, installation, topside connections, and the final commissioning of a project. The Company’s ElectroWave subsidiary offers products and services in the fields of electronic monitoring and control systems for the energy, military, and commercial business sectors. ElectroWave designs, manufactures, installs, and commissions integrated PLC and SCADA based instrumentation and control systems, including ballast control and monitoring, drilling instrumentation, vessel management systems, marine advisory systems, machinery plant control and monitoring systems, and closed circuit television systems.
The Company’s strategy is to consolidate service providers to the offshore industry, as well as designers and manufacturers of subsea, surface, and offshore rig equipment used by major, independent, and foreign national oil and gas companies in deep-water exploration and production of oil and gas throughout the world. Deep Down’s customers include BP Petroleum, Royal Dutch Shell, Exxon Mobil Corporation, Devon Energy Corporation, Chevron Corporation, Anadarko Petroleum Corporation, Marathon Oil Corporation, Kerr-McGee Corporation, Nexen Inc., BHP, Amerada Hess, Helix, Oceaneering International, Inc., Subsea 7, Inc., Transocean Offshore, Diamond Offshore, Marinette Marine Corporation, Acergy, Veolia Environmental Services, Noble Energy Inc., Aker Kvaerner, Cameron, Oil States, Dril-Quip, Inc., Nexans, Cabett, JDR, and Duco, among others. For further company information, please visit www.deepdowninc.com and www.electrowaveusa.com.
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