Alcoa (NYSE:AA) announced today that it has reached an agreement with Noble Corporation to acquire Noble's intellectual property pertaining to welded aluminum risers used in offshore oil and gas exploration and development. Noble, a leading drilling contractor, designs and deploys welded aluminum riser systems using Alcoa's advanced extrusions and forgings, including the same highly engineered alloys used by the aerospace industry.
Advances in metallurgy and joining technology have made aluminum risers more durable and corrosion resistant. This acquisition enables Alcoa to partner with manufacturers in the oil and gas industry to develop lightweight welded aluminum risers for deepwater applications.
"We see this acquisition as a unique growth opportunity for Alcoa. Lightweight and strength are attracting customers to aluminum risers. We are moving ahead in the value chain, leveraging our aluminum alloy and structural technology to provide innovative solutions to the oil and gas industry," said Mary Zappone, President, Alcoa Oil & Gas.
Aluminum risers offer several advantages for deepwater drilling.
- Offshore drilling contractors using either retrofits or new build vessels can explore in deeper depths of 20% or more versus conventional steel risers. Specifically, aluminum enables a lower cost, shallow water ship to drill at a greater depth. Technology improvements reduce the time and cost of modifying ships, providing operators with a cost-effective fleet of deepwater vessels.
- Welded aluminum risers weigh nearly 40% less than steel risers and require up to 40% less buoyancy material for similar depths.
- Due to the weight savings, aluminum risers are easier and less expensive to transport, store and deploy.
"It's all about helping our customers address the escalating costs of exploration and development. The industry is moving toward extended range and deep water drilling projects because most easily accessible oil and gas reservoirs have been exploited. This trend will require new and innovative solutions to make these challenging reserves more economical to access," Zappone added.
In addition to the welded aluminum risers, Alcoa is also developing aluminum solutions capable of reducing the weight of a conventional drill ship, platform or other structure, allowing the industry to reach reserves previously thought economically unviable.