By OGJ editors
HOUSTON, Sept. 2 -- The installation of 51,000 km of offshore pipeline worldwide is forecast during the next 5 years, representing a 42% increase compared with the previous 5 years, said UK analysts Douglas-Westwood and Infield Systems.
"We estimate that these installations—which include flowlines, risers, export systems, and trunk lines—will require a global capex of $54.4 billion," said Dominic Harbinson of Douglas-Westwood.
Two regions, Western Europe and North America, look set to dominate the market, accounting for more than 40% of the activity forecast for the period, said the report, entitled World Offshore Pipelines and Umbilicals Report 2003-07.
Regarding geographical regions, the report defines North America as the US, Canada, and Greenland, while Mexico is included in Latin America.
Capital expenditures off Western Europe are forecast at $10.8 billion. Capital expenditures off North America could top $11.5 billion, driven almost entirely by activity in the Gulf of Mexico, the report said.
"Activity off Africa and Asia is also expected to grow strongly, requiring regional spends of $9.7 billion and $8.3 billion, respectively," Harbinson said.
The report also forecast 10,600 km of umbilical installations through 2007, a 22% increase compared with 8,700 km installed during 1998-2002.
Global capital expenditures in the umbilical sector during 2003-07 are forecast at $2.6 billion, up 53% from the $1.7 billion estimated expenditures during 1998-2002. Western Europe is expected to maintain its position as the leading umbilical market with an anticipated spend of more than $863 million, followed by North America with almost $700 million.
In the flexible pipe segment, 2,100 km of pipe is forecast for installation worldwide during 2003-07, with Latin America accounting for 56% of the global total.
A demand decline is expected in the second major flexpipe region—Western Europe. But that is expected to be offset by increases in Latin America, North America, and Africa. Capital expenditures in the flexpipe segment are forecast at almost $5 billion for the period.
"The underlying driver for activity in the offshore pipeline and umbilicals sectors is the growth in global energy demand. In addition, there are four marked trends within the offshore sector that can be expected to contribute strongly to growth in the pipeline and umbilical sectors," said Roger Knight, Infield Systems data manager.
These trends are:
--An increased uptake of subsea production technology.
--The industry's move into deep waters.
--The growth in long-distance gas transmission projects.
--The establishment of long-distance power and communications links to offshore facilities.
