Investments in floating production systems worldwide are set to soar to $21 billion in 2017, up from $12 billion this year, according to Douglas-Westwood's latest market forecast.

BeckmanJeremy Beckman • London

Short-term FPSO outlook strong

Investments in floating production systems worldwide are set to soar to $21 billion in 2017, up from $12 billion this year, according to Douglas-Westwood's latest market forecast. However, both figures apply mainly to commissioned facilities - the outlook for new orders looks poor, the analysts claimed, with the oil price decline likely to delay sanction of various new projects.

FPSOs comprise the largest segment of the market between 2015-2019, accounting for 87 installations and 81% of the forecast capex, followed by TLPs and other floating production systems. Almost one-third of the forecast installations are for Latin America, with 68% of the facilities globally destined for deepwater projects.

The Bahamas

A second reading of a new Petroleum Act was due to go before the Bahamian parliament this winter, and following a consultation phase the proposals should pass via the senate into law. Bahamas Petroleum Co., which has completed studies for a drilling campaign offshore the Bahamas, says it remains committed to spudding its first well as soon as possible.

South America

Tullow Oil plans to acquire 4,000 sq km (1,544 sq mi) of 3D seismic over block 54 offshore Suriname. This summer, the company expects to participate in a well operated by Teikoku Oil on the Spari prospect in offshore block 31.


Statoil and Sinochem have submitted a Phase 2 development plan for the Peregrino oil field offshore Brazil. This calls for installation of a second wellhead platform (Platform C) which will be used to drill 15 oil producers and six water injectors on the southwest part of the field from a new drilling center installed in 120 m (393 ft) of water. The platform will be connected to the Peregrino FPSO and will also supply power to the existing wellhead platform. Statoil expects the $3.5-billion scheme to recover a further 250 MMboe.

Farfan extension in Sergipe basin offshore Brazil. (Map courtesy Petrobras)

Petrobras has confirmed an extension of an oil and gas discovery in the Farfan area of Brazil's Sergipe-Alagoas basin, 103 km (64 mi) from Aracaju. The well, drilled in 2,467 m (8,094 ft) of water, 10 km (6.2 mi) from the discovery well, also penetrated a shallower-lying, 68-m (223-ft) thick light oil accumulation.

Elsewhere off Brazil, the company proved heavy oil with a well on the ultra-deepwater Basilisco structure in the Campos basin, 143 km (89 mi) from Armação dos Búzios on the Rio de Janeiro state coast.


The semisubmersible Eirik Raude was due to sail into Stanley harbor at the end of February to prepare for a six-well exploration campaign on various licenses offshore the Falkland Islands. Rockhopper will participate in four wells, all in the North Falkland basin (NFB), with the first likely to be on the Zebedee prospect.

Rockhopper's partner Premier Oil is assessing design options for a leased FPSO for its planned first-phase development of the Sea Lion oil field in the NFB. This would be connected to a single subsea drill center. The company is currently targeting sanction for this phase during 1Q 2016, and hopes to bring in a partner to co-fund this and subsequent phases that could involve more FPSOs or a TLP.

West Africa

Kosmos Energy has agreed to farm out to Chevron 30% of its interest in three contiguous concessions offshore Mauritania. Water depths over blocks C8, C12, and C13 range from 5,249-9,842 ft (1,600-3,000 m). Assuming approval from the government for the transaction, Kosmos would remain operator in the exploration phase with Chevron assuming control in the event of a commercial discovery.

Tullow has agreed to transfer a 40.5% stake in Mauritania's shallow-water block C-3 to Sterling Energy for around $2.5 million, in consideration for past costs. Tullow is due to process 1,600 km (994 mi) of newly acquired 2D seismic over the block, fulfilling its Phase 1 commitments. If the partners opt to enter the next two phases, the obligations include 3D seismic and two wells. Sterling sees this as an emerging shelf play, following Cairn Energy's 2014 SNE-1 oil discovery off Senegal to the south.


Offshore Cameroon, Sterling is hoping for government approval to assume Murphy's 50% operated interest in the Ntem concession, where water depths vary from 400-2,000 m (1,312-6,562 ft). Last year the partners drilled the unsuccessful Bamboo-1 well on the concession, which is in the prospective southern Douala/Rio Muni basin.


Eni has a new gas/condensate discovery offshore Gabon. The Nyone Deep 1 well was drilled in block D4. Eni assessed in-placed resources at around 500 MMboe.

Mediterranean Sea

PA Resources (PAR) has canceled a proposed sale of operating interests to EnQuest in the Didon oil field and the Zarat permit offshore Tunisia. This follows the failure of the Tunisian authorities to issue a letter of non-objection to the transaction. PAR says it is continuing studies on Zarat, the country's largest unexploited gas discovery, and aims to submit a development plan later this year.


Subsidiaries of Israeli conglomerate Delek Group have accepted a request from Cyprus' government for an extension to negotiations on gas imports via pipelines from the deepwater Leviathan field offshore Israel. The period of validity now runs until April 30. Noble Energy operates Leviathan in the Levantine basin offshore Israel.

Black Sea/Caspian Sea

The semisub Ocean Endeavour has been drilling the Pelican South-1 exploration well in the Romanian sector of the Black Sea for ExxonMobil and partner OMV Petrom. Earlier, the rig completed an appraisal well on the Domino gas discovery. The partners plan additional drilling to evaluate the deepwater Neptun block's potential.


North Caspian Operating Co. has contracted Saipem for further pipelay for the shallow-water Kashagan field in the Kazakh sector of the Caspian Sea. Under the $1.8-billion program, Saipem will install two 95-km (59-mi), 28-in. carbon steel pipelines, internally clad with a corrosion alloy layer, connecting the offshore D island with the onshore plant at Karabatan. The offshore sections of the lines will be around 65 km (40 mi) long. Work is expected to be completed by the end of 2016.

Production at Kashagan had to be suspended soon after start-up in late 2013 following stress cracking in the pipeline system caused by hydrogen sulfide (H2S) in the field's wellstream.

Middle East

The heavy-lift barge Lan Jing has installed the Hasbah tie-in platform (TP) for Saudi Aramco offshore Saudi Arabia. The vessel's 7,500-ton crane lifted a weight of around 5,000 tons, a new record for an Aramco heavy-lift operation.

Additionally, the vessel installed the 4,600-ton Arabiyah field tie-in platform and a 1,800-ton intermediate injection platform. The Arabiyah-Hasbah gas fields project is designed to supply 2.5 bcf/d to the onshore gas plant at Wasit.


Iran Offshore Oil Co.'s new 2.2-MMbbl floating storage unit/export terminal has started operating in the Persian Gulf. It is designed to receive and store 200,000 b/d of produced crude from the offshore Norouz and Soroush fields. News service Shana claimed the double-hulled FSU is the largest of its type in the world, at 337 m (1,105 ft) long, 60 m (197 ft) wide, and 33 m (108 ft) high.

East Africa

Anadarko proved gas from two reservoirs with its latest appraisal well on the deepwater Orca discovery in Mozambique's Offshore Area 1. It has since drilled a further well on the 2014 Tubarão Tigre gas discovery. The Area 1 partners continue to negotiate long-term gas sales from their various fields which they plan to develop via LNG. They currently have heads of agreement in place to supply more than 8 MM metric tons/yr (8.8 MM tons/yr), Anadarko said.


A 3D seismic survey was due to start last month over the Ambilobe block offshore Madagascar, operated by Sterling Energy. The company and partner Pura Vida recently won an extension to the production-sharing contract until July 2016.

India/Southeast Asia

Technip has completed the floatover installation of the 8,200-metric ton (9,039-ton) integrated production deck for the HRD process platform at ONGC's Heera field offshore western India. The contractor's Indian office designed the topsides for the Unideck method, which allows installation of large decks in a single operation in long-period swells via a series of jacks that lower the topsides into place.


South Korean company SK has secured operatorship of two blocks in the Pearl River Mouth basin in the South China Sea. Blocks 04/20 and 17/03 are in water depths of 50-100 m (164-328 ft). The company and partner CNOOC will acquire 2D seismic and drill exploration wells.

In the offshore Bohai region, CNOOC has produced first oil from its Jinzhou 9-3 field adjustment project in the North Liadong Bay, where water depths vary from 6.5-10.5 m (21.3-34.5 ft). Main facilities are a central processing platform, a wellhead platform, and 21 production wells. Later this year, output should reach a peak of 12,000 b/d.


Myanmar's government has awarded Shell operatorship of deepwater blocks AD-9, AD-11, and MD-5 under the country's 2013 offshore bidding round. Shell has a 90% interest in each case, in partnership with Mitsui.


Talisman Energy is working on a development for the CRD oil and gas discovery in block 07/03 offshore Vietnam. According to partner Pan Pacific Petroleum, the favored concept is a tension leg wellhead platform and an FPSO, with first oil potentially in 2018.


Santos and INPEX have been awarded two exploration permits off northwest Australia, 500 km (310 mi) northeast of Broome, in water depths of 300-400 m (984-1,312 ft). Release Areas WA-513-P and WA-514-P are close to large gas discoveries that include the INPEX-operated Ichthys field, Shell's Prelude, and last year's Lasseter find.

Santos and INPEX were awarded two new blocks in the Browse basin. (Map courtesy INPEX)

INPEX hopes to prove more gas to supply the Ichthys LNG project. In February, the ENSCO-5006 started drilling the first of 20 production wells in the Brewtser reservoir. The wells will be grouped around five drill centers.


Woodside Petroleum has contracted Wood Group Kenny to perform front-end engineering and design (FEED) of a 16-in. corrosion-resistant alloy subsea flowline system. This will serve the proposed Greater Western Flank Phase 2 (GWF-2) development for the North West Shelf project offshore Western Australia. GWF-2 will harness gas from the Dockrell, Lady Nora, Keast, Rankin, and Sculptor accumulations. An investment decision is due later this year.


Test results from two wells at the Kupe oil and gas field 30 km (18.6 mi) south of New Zealand's Taranaki coast look promising, according to partner New Zealand Oil & Gas. Operator Origin Energy commissioned fluid contact measurements and additional perforations below existing perforations to enhance production. Analysis suggests ultimate recovery may be higher than previously forecast and that untapped gas reserves may lie trapped beneath shale layers.

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