every time i read this i keep hearing ron smith tell me-THE WORLD IS OUR CUSTOMER!
Subsea market to remain strong
2008.02.12 - Subsea Headlines
According to a new report to be published shortly by Scottish Enterprise the global subsea oil & gas market will remain very strong for the foreseeable future. Despite growing by a near 90% in the past five years the market is likely to continue to grow and is forecast to total $218 billion over the period 2008-2012.
Commenting on the occasion of the Subsea 08 conference in Aberdeen today, Brian Nixon, Scottish Enterprise’s Head of Energy said “subsea technology and operations has grown to be a key strategic sector for Scottish oil & gas sector companies and Scottish skills can be seen at work on subsea projects worldwide. We are pleased to see that the market will remain so strong in the years ahead.
“In 1975 Scotland’s Argyle field led the world by producing its first offshore oil from subsea wells connected to a floating production system. From these beginnings Scottish companies have developed a world-leading position in technology supply and operations and are now major suppliers to world markets valued at some $35 billion in 2007 and set to grow to $45 billion by the end of 2012.
“As offshore production in the world’s mature basins declines attention has been increasingly focussed on deepwater and its enabling technology of subsea production. In addition, subsea wells tied back to existing infrastructure often offer a cost-effective solution to accessing the considerable reserves of the hundreds of small field prospects in mature areas such as offshore Scotland.”
“The technical and commercial challenges that lie ahead are huge, but the opportunities for Scotland's subsea companies have never been better.”
“The Subsea Market Report 2003-2012” is one of a series of reports commissioned by Scottish Enterprise’s Energy Team from energy business analysts Douglas-Westwood.
Lead analyst on the study, Thom Payne from Douglas-Westwood’s Aberdeen office said “we expect that increasing global energy demand coupled with high oil price and the move to deeper waters will drive subsea activity to new levels the years ahead. Key regions within the market are Africa, Latin America, North America and the North Sea. Together these regions accounted for over 70% of the global subsea market in 2007.
“Further discoveries and developments in Brazilian deepwater plays will continue to drive growth in the Latin American market over the 2008-2012 period. Currently we expect that the vast majority of Latin American spend will be focused in this area but uncertainties over future developments in Mexico, such as Ku Mallob Zaap field could result in increased spend in this area over the forecast period.
“Driven by increased deepwater activity, the African subsea market is growing at faster rate than all other regions with expenditure expected to increase by 16% from 2008 to 2012 when spend will equal just over $11 billion. Other significant growth markets will be Latin American and Asia.
“The Asian subsea market was valued at $4.2 billion in 2007 and we expect it to exceed $6 billion in 2012. In the main this market is profiled by rising energy demand driving offshore and subsea pipeline construction.”
Turning to the other regions Payne said “The subsea market of other global regions such as the Middle East and the Russia will be characterised primarily by export and trunk lines linking them with consumer markets in Asia and Europe. We expect that these developments will result in the ‘Rest of the World’ accounting for 14% of the 2008-2012 market. Onwards from 2012 we expect that significant developments in the Russian Arctic and the massive South Pars field in Iran could drive subsea spend in these regions.
“The only thing that is stopping the market growing at a faster rate” said Payne, “is a global shortage of resources ranging from deepwater drilling rigs to experienced engineers”.
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