Floating Production: Strong Growth in Spend Forecast
Over the next five years some $43 billion is likely to be spent on floating production systems as a total of 123 FPSs are installed worldwide. These are amongst the forecasts in a new report launched in Oslo today by energy analysts Douglas-Westwood.
In a keynote speech to delegates at the Tekna Floating Production Conference in Oslo, Douglas-Westwood’s Managing Director Andrew Reid said, “The potential for strong growth in the floating production sector is clearly apparent. There are many more floater prospects on screen for 2008-2012 than were installed over the preceding five-year period. Significant growth is on the cards for the fleets of Asia, Australasia, Latin America and Western Europe, with more moderate growth likely for Africa. North America shows a marginal decline in growth when compared to the previous five-year period; however, many projects in the GoM have relatively short lead times and levels of activity are therefore expected to exceed the prospects identified currently.
“In terms of market value, the world’s three major deepwater regions – Africa, North America and Latin America – account for 63% of forecast global Capex. The relatively benign environments and shallow waters in which most of the Asian FPS prospects are located, enable cheaper FPS solutions to be adopted.
“We forecast that over the 2008-2012 period floating production, storage & offloading systems (FPSOs) will account for the largest proportion of these installations (95 vessels), along with 11 floating production semi submersibles (FPSSs), 11 tension leg platforms (TLPs) and six spars.
“FPSOs represent by far the largest segment of the market, accounting for nearly 80% of the forecast Capex. FPSSs form the next-largest segment at 10%, TLPs take 7% and Spars 4%.”
“The next big surge of FPS installation activity is likely to be associated with Brazil’s 5-8 billion barrel Tupi find. That will be beyond the timeframe of our report, but the period should see the beginnings of ordering activity. In the short term, however, backlog growth within the equipment markets for long-lead items over the forecast period may slow as a large number of orders will be placed during 2008,” said Reid.
