LONDON –The global offshore fixed platform market outlook is positive with increasing investment over the next five years, reports Infield Systems in its Global Perspectives Fixed Platform Market Report to 2017.
Asia is projected to account for a majority 37% share of global fixed platform capex as well as 42% of the installation market.
China will be a key driver as it attempts to sustain economic growth and reduce its reliance on imports. Malaysia is also expected to continue as a key player to support its foreign and domestic demand. A recent budget announcement saw the Malaysian government commit to a favorable tax regime for oil and gas companies for a 10-year period. This is likely to incentivize growth within the industry.
Emerging markets such as Africa, West African in particular, are expected to fuel demand and account for a growing share of the market in the future.
Fixed platform capex in Africa is expected to be robust, exceeding levels seen during the historic period in every year of the forecast. Angolan and Nigerian developments continue to be the key drivers, with IOCs and some independents carrying out some major fixed platform developments. Chevron is one of the key players in the region; with its Mafumeira project in Angola forecast to require substantial investment relating to the development of its associated fixed platforms. The company's fields in Nigeria are also expected to require significant expenditure over the forecast period to capture more of their associated gas.
Elsewhere, within Europe, capex on fixed platform projects is expected to be 53% higher than over the last five years, and in Australasia, major developments which are scheduled off Australia’s northwest coast should also provide long-term market support.
Other regions are more mixed. In the Middle East, despite a slight drop in capex compared to the historic period, Iran’s NOC NIOC is expected to continue to invest significantly in its planned development of the South Pars field.
Turning to Latin America, its share of the fixed platform market is projected to shrink slightly due to the reduction of activity in Mexico. However, the region is still expected to see a 29% increase in expenditure over the forecast period in comparison to the last five years.
The Macondo incident in the Gulf of Mexico, along with booming onshore unconventional gas production, has led to a decline in shallow-water production in the US in recent years. However, with high oil prices, there is a renewed effort to exploit small shallow water reserves, which could boost the country’s demand for fixed platforms in the future. These could generate a recovery in the North American market toward the latter part of the forecast to levels not seen since 2008.
In terms of water depth, Infield Systems expects to see an increase in capex across most categories. Platforms in the 25-50 m (82-164 ft) and 51-75 m (167-246 ft) water depths are expected to account for the largest share of the market, with platforms situated in the 25-50 m water depth category seeing the largest share of the installation market.