Petrobras to lead new wave of FPSO orders, report finds

After a strong start in the first half of the year, the pace of orders slowed down with only four (one FPSO, one FSRU, and two LNG FSOs) announced in 3Q, according to Energy Maritime Associates’ latest Floating Production Systems Report.

Leased FPSO fleets of leading contractors.
Leased FPSO fleets of leading contractors.
(Courtesy Energy Maritime Associates)

Offshore staff

SINGAPORE – After a strong start in the first half of the year, the pace of orders slowed down with only four (one FPSO, one FSRU, and two LNG FSOs) announced in 3Q, according to Energy Maritime Associates’ (EMA) latest Floating Production Systems Report.

This brings the total number of units awarded in 2019 to 13: six FPSOs, three FSRUs, two FSOs (LNG), one semi, and one MOPU.

According to the report, 27 projects are likely to reach FID in the next 12 months; however, many have completed tendering and are just pending final FID/formal announcement. EMA expects a surge of orders before year end, particularly from Petrobras, which has five projects in the tender process.

EMA expects up to six additional FPSO awards in the next three months.

The orderbooks of contractors are filling up, with leading companies taking on multiple projects. Modec and SBM Offshore each have four FPSOs on order.

There have been a range of responses to this increase in activity. For example, long-term agreements, new entrants, and capacity constraints/cost inflation.

In September, SBM Offshore and ExxonMobil signed a long-term agreement covering potential future FPSO orders. This is expected to cover requirements for three more FPSOs in Guyana.

In mid-September, Kvaerner announced it plans to expand its FPSO business.

The reported noted that contractors have reported constraints in certain areas, particularly for yard capacity and experienced personnel. Also, costs are starting to increase for in-demand, skilled roles. 

10/14/2019

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