Shares in Plexus Holdings (AIM: POS) rose 14% to 3.37p in early trading on Monday after the oil equipment engineer announced a new engineering agreement with Cactus Wellhead.
The two-year agreement will see Plexus develop and qualify a range of surface wellhead products for offshore energy applications.
The work will begin immediately and will be carried out at Plexus’ Aberdeen facility, using the company’s engineering expertise and testing infrastructure.
The agreement includes an initial commitment payment of £1 million, secured by a debenture.
Plexus said the contract is expected to generate a further £1.5 million of revenue over its duration, with potential for additional expansion.
Chief executive Craig Hendrie said the award reflected Plexus’ reputation for technology excellence and successful product development and qualification testing over many decades.
He said the agreement gives Plexus the opportunity to retain and build its capabilities in Aberdeen at a time when investment in the North Sea has been under pressure.
Hendrie added that the company was “very excited and proud” to have secured the opportunity.
