Study expects a floater market recovery in 2010

Despite the failure of an estimated $10 billion of expected orders to materialize as the global economy derailed in 2008-09, Douglas-Westwood Ltd. in a recent report expects the installation of floating production units to recover in 2010, with $45.8 billion being spent during 2009-13.

By OGJ editors
HOUSTON, June 24
-- Despite the failure of an estimated $10 billion of expected orders to materialize as the global economy derailed in 2008-09, Douglas-Westwood Ltd. in a recent report expects the installation of floating production units to recover in 2010, with $45.8 billion being spent during 2009-13.

“The impact on this sector has been massive and to see $10.4 billion of anticipated orders this time last year for 2008-09 not materializes is unprecedented,” said Steve Robertson, Douglas-Westwood director. “However, we are convinced that the long-term fundamentals for the sector are strong. The need to exploit reserves in deep waters, marginal fields, and remote locations will undoubtedly increase as the offshore industry matures and floating production systems are a key enabling technology in these areas,” he said.

The report forecasts the installation of 121 floating production systems during 2009-13, with 94 floating production, storage, and offloading vessels accounting for the largest proportion of these installations. The other installations will have 12 tension-leg platforms, 11 floating production semisubmersibles, and 4 spars.

Africa, North America, and Latin America will account for 59% of the forecast capital expenditures, the report says.

In addition, Douglas-Westwood expects Petroleo Brasileiro SA to remain the leader in spending on floaters. Other major companies expected to have sizable spending on floaters in the next 5 years are Total SA, Chevron Corp., Royal Dutch Shell PLC, and BP PLC.

The report says the top 10 operators will account for 55% of the installations and 68% of the capital expenditures forecast for 2009-13.

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