Floating production business set for sustained growth in capital expenditure
Posted: 13 May 2007
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Over 120 floating production systems are forecast to be installed over the next five years and the capital expenditure required to complete these orders is expected to total $38 billion. These are the headline findings of the new edition of the acclaimed study, The World Floating Production Report, launched at Houston’s Offshore Technology Conference by leading energy analysts Douglas-Westwood.
“The floating production business has grown rapidly over the last five years, with 81 units installed over the period. The next five years should see continued growth with a total of 121 installations forecast. African and Latin American regions are expected to see the highest number of deployments” said study’s main author, Steve Robertson.
“The diversity of the global FPS fleet also seems set to grow over the 2007-2011 period, although FPSOs will continue to dominate the global FPS scene, with the installation of 92 units forecast over the next five years.
“The overall picture is one of strong market growth, with orders now clearly climbing and expected to lead to some major installation activity towards the end of the decade. Annual global expenditure in the FPS sector is expected to increase from an estimated $6.4 billion in 2007 to $9.8 billion in 2011.
“In terms of the total market, and counting floaters of all types, installation activity off Africa will see it attract the largest share of total expenditure at $9.6 billion over the next five years. A series of major deepwater developments offshore Brazil will help boost the Latin American FPS sector – forecast to be worth $9 billion over the 2007-2011 period. Asia is set for significant growth, with forecast installations worth $6.3 billion over the period, from $2.8 billion during 2002-2006.
“The continuing shift to deepwater remains a key driver” said Robertson. “We forecast that around 70% of the global spend will be on floaters moored in water depths of 500 metres or greater.”
The World Floating Production Report uses information from The World Floating Production Database, an information system maintained by Douglas-Westwood. According to database editor, Georgie MacFarlan, “over the next five years we expect five operators to account for nearly 40% of the installations and 50% of the capex forecast worldwide for the 2007-2011 period. Petrobras, with 13 installations forecast, is expected to be the biggest spender, followed by Total, then Chevron, Shell and BP.”
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