Deepwater Spend Forecast to Surge from 2016 Onwards
Deepwater expenditure is expected to increase by 130%, compared to the
preceding five-year period, totalling $260 billion (bn) from 2014 to 2018. As
production from mature basins onshore and in shallow water declines,
development of deepwater reserves has become increasingly vital. Robust oil
prices support investment in deepwater developments - the sustained high oil
prices over the past few years have increased confidence in the sector.
Africa and the Americas continue to dominate deepwater capital expenditure
(Capex), with $213bn set to be spent over the next five years. Africa is
forecast to experience the greatest growth among the three regions, as East
African natural gas developments begin production and become more prominent in
the latter years of the forecast period. Latin America will remain the largest
market and North America is expected to experience the least growth.
Douglas-Westwood (DW) has identified a temporary trough in global expenditure
in 2015 primarily driven by delays to delivery of FPS units in Latin America.
African projects have also experienced delays resulting in a surge in Capex
from 2016 onwards.
DW's 12th edition of the Deepwater Market Forecast covers all key commercial
themes relevant to players across the value chain in the deepwater sector:
- Supply chain - detailing the financing of deepwater developments,
contractors, equipment and installations. Includes analysis of contracting
strategies (e.g. frame agreements), dayrates, key players and capabilities of
each sector within the deepwater market (drilling, FPS and subsea hardware).
- Key drivers - discussion of factors encouraging deepwater activity
- including robust oil & gas prices, deepwater production to offset declining
production from onshore and shallow water basins, E&P spend of international
operators and Petrobras' activity in Brazil.
- Regional forecasts - forecast Capex within each region, including
examples of notable projects and operators within the region and countries
with most activity.
- Component forecasts - drilling and completion (subsea and surface
completed wells), subsea production hardware, SURF and trunklines.
The report also includes:
- Constraints - the impact of political and regulatory influences and
geopolitical disputes on the deepwater market.
- Local content requirements - includes case studies of key countries.
- Focus areas - examination of deepwater provinces, including recent
discoveries in East Africa.
- Procurement - factors affecting the decisions facing FPS operators,
whether to lease or own vessels and details of major leasing contractors.
- List of deepwater prospects - includes information on all
identified prospects coming onstream from 2014 to 2018 by operator, location,
water depth, number of trees and status category.