Offshore project commitments are expected to soar to a record high reaching almost 600 projects in the five-year period to 2025, says Rystad Energy.
According to a report by the consultancy, deepwater commitments will enjoy the largest growth as their cost has now become much more competitive against greenfield continental shelf reserves.
From the beginning of 2021 and up until the end of 2025, Rystad Energy’s forecasts 592 commitments, with growth across all water depth levels when comparing to 355 projects during the period 2016-2020.
Due to the expected growth in E&P activities, the number of new offshore facilities is also set to increase. Rystad Energy expects a 50% rise in the number of owned FPSOs expected to be used on upcoming projects till 2025.
“The growth in commitments will stimulate rising demand for floating production, storage and offloading vessels as well as subsea tiebacks. The search for large new fields in deep and remote waters became much more economically viable after dayrates for drilling rigs and offshore supply vessels fell in the wake of the oil price crash in 2014 and 2015. This offers significant support for companies interested in deepwater,” said Rajiv Chandrasekhar, energy service analyst at Rystad Energy.
In terms of greenfield expenditure, Rystad Energy expects offshore project commitments in the period to be worth more than $480bn.