By the OGJ Online Staff
HOUSTON, Aug. 30 -- The annual value of the world offshore pipelines market is expected to grow to $13.1 billion in 2005 from $8.1 billion this year, said UK analysts Douglas-Westwood Ltd. and offshore industry data specialists Infield Systems Ltd., London, in a new report.
Recovery from the oil price dip of 1998 slowed the market in 1999 and 2000, but demand for offshore pipelines now will resume a long-term growth trend, said the World Offshore Pipelines & Umbilicals Report.
Over the period 2001-2005, the market will total $50.5 billion, compared with $38.2 billion in the previous 5 years, concluded the report.
Europe will continue to form the largest segment in the period, at 29%, but the largest future growth will be in the Asia-Pacific region, said Douglas-Westwood and Infield Systems.
"Our forecasts further suggest that growth will accelerate from 2004 mainly as a result of major gas lines, particularly in the Asia-Pacific region," said analyst Barney Parsons of Douglas-Westwood.
"Over the past 5 years, some 51% of pipeline kilometers have been laid in water depths down to 100 m. But a fundamental change occurred in 1999 as the amount of pipeline laid in depths greater than 500m dramatically increased and the indications are that deepwater activity will continue to grow," he said.
The report also indicated that the top 20 operating companies involved in the offshore pipelines business account for 63% of future prospects. However, the operator distribution of control umbilical prospects shows that the top 20 companies account for 79% of the prospects.
"Our view is of markets that show every chance of enjoying long-term growth prospects driven by the fundamentals of a continuing increase in demand for offshore oil & gas. However, the underlying offshore industry is of a highly cyclical nature ... Therefore, this continues to be a market best suited to those able to operate on a global scale and make a corporate commitment measured in decades," said Parsons.