The offshore oil and gas sector is primed for a burst of investment to make up for low spending in recent years.
In the absence of any major surprises in oil and gas demand, data compiled by consultancy Westwood Global Energy shows a sustained upcycle over the 2022-26 forecast period, with offshore engineering, procurement, and construction (EPC) spending estimated to total $276bn, a 71% increase over the previous five-year period.
According to Westwood, Asia, the Middle East, and Latin America will account for the majority of spending. Untapped gas reserves in West Africa are also expected to attract investment during the forecast period, as Europe desperately seeks alternative gas supplies to replace Russian feedstock.
Offshore oil and gas EPC contracting activity increased threefold in the first six months of 2022 compared to the same period last year, totaling an estimated $26bn.
Westwood estimated offshore related awards to total $42bn in the second half of 2022, driven by contract awards for 138 subsea tree units, 15 FPS units, 119 fixed platforms (topsides), over 3,870 km of subsea umbilicals, risers and flowlines, and 3,500 km of line pipe.