By OGJ editors
HOUSTON, Oct. 8 -- The oil and gas industry will spend $100 billion on deepwater exploration and production worldwide in the next 5 years, forecast Business Communications Co. Inc. (BCC), Norwalk, Conn.
In a report entitled "World Markets for Deepwater Hydrocarbon Exploitation: Highlighting Production, Projects, and Construction," BCC said that world offshore E&P spending totaled $31.9 billion during 1990-99.
In 2000 alone, world E&P spending was nearly $77 billion. Through 2006, BCC said $100 billion will be spent in deepwater alone with the most activity expected in Brazil, West Africa, and the US Gulf of Mexico.
Distinct from those three oil-dominated areas, BCC analysts forecast an increase in activity in Northwest Europe, the Mediterranean, the former Soviet Union, the Middle East, and Asia, which are all dominated by natural gas.
Following a 14.8% average annual growth rate (AAGR) during 1998-2001, the market for floating production will moderate to 2006 when it will increase with an AAGR of 3.9%, BCC said. "This growth comes as the large number of projects has moved from the planning to final design and bidding stage since the second half of 2000," it said.
The basic floating structures include tension leg platforms, converted or newbuild tankers such as floating production vessels or barges, semisubmersible production units, and spar towers.
Basic structure expectations
Most TLP designs currently offered tend to reach their economic limits in water depths less than 5,000 ft, although some studies with composite materials indicate that it might be possible to install TLPs in water deeper than 10,000 ft.
"TLPs have been growing in popularity, especially the mini-TLPs, which are a cost-effective solution in smaller deepwater fields giving an AAGR of 20.5% between 1998 and 2001," the report said.
TLPs are best used in areas having pipeline infrastructure such as in the Gulf of Mexico. Because many deepwater developments are in regions without pipeline infrastructure, the spar tower market will moderate over the next 5 years to 2006 at an AAGR of 6.3%.
Floating production, storage, and offloading vessels probably have the greatest flexibility of all deepwater production systems, BCC said. As a result, the market increased at an AAGR of 14.2% during 1998 and 2001. The market will grow at an AAGR of 2.5% to 2006.
By contrast, semisubmersible designs offer better motion characteristics but a lesser degree of mobility, compared with the drillship. "Mainly it is the lack of mobility. . .that better suits the design toward development programs characteristically consisting of longer tours of duty at a single location," the report said.
Over the next 5 years, demand for semisubmersibles will increase at an average of 1.7% as the developmental drilling programs that were developed during 1998-2001 continue.
The market for spar tower enabling systems will increase, averaging 32%/year to 2006 compared with 4.2%/year during 1998-2001. In the past 3 years, subsea activity increased significantly as ordered spars were installed, setting up new tieback locations, BCC said.
