Wood Mackenzie predicts huge deepwater drilling spend increase

Offshore staff

EDINBURGH, UK – Drilling activity and spend will significantly increase in global deepwater markets over the next decade according to new analysis by Wood Mackenzie. The “Future of Global Deepwater Markets” study indicates well spend is expected to grow from $43 billion in 2012 to $114 billion in 2022.

Wood Mackenzie believes the number of exploration, appraisal, and development wells will increase by 150% – rising from 500 to 1,250 wells per year. 

“To meet the forecasted well demand the fleet will require 95 additional deepwater rigs to be constructed between 2016 and 2022, representing $65 billion of investment,” said Malcolm Forbes–Cable, senior management consultant at Wood Mackenzie. “This will require the longest period of deepwater rig construction to date, representing a change for the deepwater sector from cyclical to sustained growth.”

Existing rig orders and new-builds required to meet demand suggest that the rig contractors will need an additional 37,000 workers over the next decade to operate the fleet. According to Wood Mackenzie, this cannot be met with existing personnel and the historical rate of recruitment.

The report touches on a number of areas it believes require industry attention, among them, increasingly strategic alliances between IOC’s and NOC’s, increased collaboration and partnering between the supply chain and operating companies, and closer integration in training of personnel, design and development of technologies, and project implementation.

6/27/13

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