The floating, production, storage and offloading (FPSO) unit market is a byproduct of the needs of the offshore industry. All throughout 2015, the offshore industry was covered with the miasma of plummeting oil prices, lowering operator expenditures, and delayed projects. Surprisingly, despite this gloomy picture, the demand for FSPO units has been upbeat. According to Transparency Market Research, the global FPSO market was worth US$15.86 bn in 2014 and is anticipated to exhibit a CAGR of 16.2% from 2015 to 2021. This positive outlook will be a result of the growing investments in offshore exploration of oil and gas in deepwater and ultra-deepwater reserves in regions such as Brazil and Africa.
Top Players Have Busy Year Ahead
Some of the important players in the global FSPO market are Samsung Heavy Industries Co., Ltd, MODEC, Inc., BW Offshore, SBM Offshore N.V., Bluewater Energy Services B.V., Hyundai Heavy Industries Co., Ltd., Aker Solutions ASA, Bumi Armada Berhad, Teekay Corporation, and Yinson Holdings Berhad. These top players will have a busy 2016 with projects such as Samsung Heavy Industries constructing Shell’s Appomattox semisubmersible hull. The topside of this structure will be fabricated in the Gulf Coast at Kiewit in Ingleside, Texas. Meanwhile, Modec is also working on an FSO with Maersk, a collaboration that will procure, engineer, and commission the unit.
The types of FPSO vessels sold in the global FPSO market are new-build, converted, and redeployed. Depending on the water depth the vessels are designed to function in ultra-deepwater, deepwater, and shallow water. Geographically, the global FPSO market has a presence in regions such as Americas, Europe, Asia, Africa, and Oceania.
Americas to Lead Global FSPO Market
Of all the regions, the Americas held the leading position in the global FPSO market and analysts predict that this region will continue its dominance in the coming years as well. This trend will be the reflection of the high demand for FSPOs with significant developments in oil fields, especially off the shore of Brazil. Furthermore, Southeast Asia and West Africa are also proving to be lucrative markets for FPSOs with increasing deepwater and ultra-deep water offshore activities. Amongst the types of FSPOs in the market, the converted FPSO segment garnered sizeable revenue in 2014. The factors supporting this demand were faster deployment of converted FSPOs and low capital requirement as compared to new-build vessels.
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The depleting reserves of oil and gas have created an urgent need for exploration of new oil and gas reserves that will cater to the future energy demands. This urgency has created a huge demand for FPSOs amongst oil and gas exploration companies. The demand for FPSOs will also be propelled by their ability to sustain unsparing working conditions and potential to be moored at various locations post projects.