Washington, DC, firm says FPS market strong


Over the next 5 years, 13-17 floating production systems will be ordered every year, says International Maritime Associates Inc., Washington, DC.

In its latest forecast of the outlook for floating production, storage, and offloading vessels; production semisubmersibles; tension-leg platforms; and spars, IMA said the fundamentals for the FPS sector look very strong. It believes companies will spend $16-21.9 billion on FPS orders over the next 5 years.

Strong global economic growth, growing oil demand, high oil prices, and increased operator capital spending have caused a "robust rebound" in the upstream sector, said IMA. "On top of this, the equipment needed to drill in deepwater fields is now coming on stream, and the technology to produce these fields has continued to evolve and mature to significantly reduce field breakeven costs," said the report.

There are 119 FPSs in operation or available worldwide at the present time. They include 11 TLPs, 36 production semis, 69 FPSO vessels, 3 production spars, and 62 floating storage and offloading vessels. Another 62 floating storage vessels without production capability are operating, of which 4 are used for LPG storage.

This represents an 86% increase over the floaters reported in IMA's September 1996 report, published when the company first started counting the number of units in operation. And the number is increasing.

IMA said 22 production units are now on order, 11 of which were ordered during the past year�5 of those since April. They include: 14 purpose-built production systems, 7 production systems based on converted hulls, and 1 production unit relocation. The fleet breaks down as 1 large TLP, 2 mini-TLPs, 13 FPSOs (7 new, 5 conversion, and 1 relocation), 2 production semis (1 new, 1 conversion), 3 production spars, 1 mobile offshore production unit (a jack up conversion), and 6 FSOs.

The company noted six of these units are for use in the Gulf of Mexico, and three for offshore West Africa. Right now, the largest portion of FPUs in operation�28%�are working off Northern Europe.

Forecast
IMA's 5-year forecast assumes long-term crude prices in the range of $18-22/bbl. It also assumes that no floater catastrophes occur and technology continues to evolve solutions to produce in increasingly deeper water.

A higher average oil price would cause an upswing in floating production requirements, the company said.

"There has clearly been an uptick in floater planning activity, both in quantity and quality of projects," the report said. IMA has identified 133 offshore projects in the bidding, design, or planning stage where an FPS is being seriously considered as a development solution for the field. IMA said it only included the most promising projects on that list.

Off West Africa, 40 projects that are likely to use floating production systems are planned; in the Gulf of Mexico, 33 are planned. Southeast Asia ranks third, Brazil fourth, and Europe and Australia tied for fifth place.

The company predicts orders for 65-86 additional floating production systems over the next 5 years. "A higher ordering rate will occur in the earlier years of the 5-year forecast, tapering off in 2004-05 as relocations increase," the report said. It also predicted about 70% of units ordered will be FPSOs.

FPS types and order predictions
FPSO vessels can carry a large process plant and have storage capability. For conversions, there is wide availability of secondhand tanker hulls, plus low prices on new hulls from Asian yards, notes IMA.

FPSOs allow for relatively easy relocation from field to field. They are, however, unable to utilize dry wellheads.

Weathervaning FPSOs have limited riser capability, notes the firm. And finally, export of natural gas remains an unsolved problem.

Nevertheless, FPSOs remain the most popular choice. The company predicts 47-60 FPSOs will be ordered over the next 5 years, costing a combined $11.3-14.5 billion.

Semisubmersibles were long the platform of choice, IMA noted, when a large number of surplus hulls were available for conversion to floating production units. Now that the inventory of surplus semi hulls has dried up, their use is likely to be curtailed.

"Their primary advantage was low initial cost by using surplus hulls and the ability to have a production unit in service relatively quickly," said IMA. No units have been ordered over the last year. The company predicts two to four semi production units will be ordered in the 5-year period, costing $0.8-1.6 billion.

TLPs are growing in popularity, especially the mini-TLPs, which are a cost-effective solution in smaller deepwater fields. TLPs can utilize dry trees, but do, however, lack storage, and are best used where pipeline infrastructure can be accessed. Tendon weight increases dramatically with water depth, which places limits on use of TLPs in deep water. IMA expects 8-10 TLPs will be ordered over the next 5 years, of which 7-8 should be mini-TLPs and 1-2 large TLPs. They will cost $1.5-2.2 billion.

There has been increasing interest in production spars, said IMA, especially now that production capability of spar designs has significantly increased since their introduction. Spars can incorporate storage, although it has not been incorporated in the three spars now operating in the Gulf of Mexico or in the three currently on order for use there.

But because of the increasing interest in spars, IMA predicts 8-12 spars will be ordered over the next 5 years. They will cost $2.4-3.6 billion.

There are other new designs being marketed that may take their places in the pool of FPSs to be built, said IMA. They include a Petroleum Geo-Services ASA-marketed "dry-tree semi" for benign ocean environments that incorporates a semisubmersible's flexibility with the surface-tree capability of TLPs and spars. Aker Maritime AS is marketing an "oil box" concept that incorporates features of a semisubmersible and can support dry-tree production. And Single Buoy Moorings Inc. is marketing a tension-leg deck FPSO concept that combines the flexibility and low capital cost of an FPSO with the stability of a TLP. It also has the capability to support dry trees.

Related Articles

Oil-price collapse may aggravate producing nations’ other problems

02/05/2015 The recent global crude-oil price plunge could be aggravating underlying problems in Mexico, Colombia, and other Western Hemisphere producing natio...

Oil production begins at Nasr Phase-1 offshore Abu Dhabi

02/05/2015 The first phase of Nasr oil field offshore Abu Dhabi will be producing 22,000 b/d by yearend, according to United Arab Emirates news agency WAM.

Woodside lets FEED contract for Greater Western Flank project

02/05/2015 Woodside Petroleum Ltd. has let a contract to Wood Group Kenny for the front-end engineering and design for the flowline system and associated proc...

Deloitte studies oil supply growth for 2015-16

02/04/2015 A Deloitte MarketPoint analysis suggested large-field projects, each producing more than 25,000 b/d, could bring on 1.835 million b/d in oil supply...

BG’s 2015 budget ‘significantly lower than 2014’

02/03/2015 BG Group plans capital expenditures on a cash basis of $6-7 billion in 2015, a range it says is “significantly lower than 2014” due to “a lower oil...

BP trims capital budget by $4-6 billion

02/03/2015 BP PLC plans an organic capital expenditure of $20 billion in 2015, down from the previous guidance $24-26 billion. Total organic capital expenditu...

IHS sees second-half end of US output surge

02/03/2015

Expectations are moderating about growth of oil production in the US this year.

Gazprom Neft starts shale oil production in western Siberian field

02/03/2015 JSC Gazprom Neft reported start of shale oil production from the Bazhenov formation during tests of two wells in southern Priobskoye field in centr...

Anadarko reports 2014 loss, remains upbeat about Wattenberg

02/03/2015 Anadarko Petroleum Corp. announced a 2014 net loss of $1.75 billion, or $3.47/share diluted, including a net loss of $4.05 billion associated with ...
White Papers

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...
Available Webcasts


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

When Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST



On Demand

Prevention, Detection and Mitigation of pipeline leaks in the modern world

Thu, Apr 30, 2015

Preventing, detecting and mitigating leaks or commodity releases from pipelines are a top priority for all pipeline companies. This presentation will look at various aspects related to preventing, detecting and mitigating pipeline commodity releases from a generic and conceptual point of view, while at the same time look at the variety of offerings available from Schneider Electric to meet some of the requirements associated with pipeline integrity management. 

register:WEBCAST


Global LNG: Adjusting to New Realities

Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


US Midstream at a Crossroads

Fri, Mar 6, 2015

Oil & Gas Journal’s Mar. 6, 2015, webcast will focus on US midstream companies at an inflection point in their development in response to more than 6 years shale oil and gas production growth. Major infrastructure—gas plants, gathering systems, and takeaway pipelines—have been built. Major fractionation hubs have expanded. Given the radically changed pricing environment since mid-2014, where do processors go from here? What is the fate of large projects caught in mid-development? How to producers and processors cooperate to ensure a sustainable and profitable future? This event will serve to set the discussion table for the annual GPA Convention in San Antonio, Apr. 13-16, 2015.

This event is sponsored by Leidos Engineering.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected