Floating production continues to grow at a dynamic pace. There are now 197 floating production systems in operation worldwide. Another 62 systems are on order. Most important, there are more than 100 projects in the planning stage that potentially require a floating production system.
Production Floaters Approaching 200 Units:
The current inventory consists of 118 FPSOs, 40 production semis, 20 TLPs, 15 spars and 4 production barges. They are producing on fields primarily offshore West Africa, Northern Europe, US Gulf Coast, Brazil, Southeast Asia, China and Australia/New Zealand. Another 76 floating storage vessels (without production capability) are now in service, primarily in Southeast Asia, West Africa and the North Sea.
Order Backlog at Record Level:
With more than a dozen orders over the past four months, order backlog of production floaters as of mid-March has risen to 62 units. This is the highest backlog in the history of floating production. Backlog, which began climbing in late 2005, has increased more than 75 percent over the past two years. The current backlog consists of 46 FPSOs, 8 production semis, 2 TLPs, 3 spars, 2 barges and a ship shape FPU.
More Than 100 New Projects Being Planned:
In a just published study, U.S. consulting firm IMA has identified 109 offshore projects in the planning pipeline that potentially require floating production systems. 40 percent of these projects are at the bidding or final design stage, 60 percent are in the concept development or study phase. According to Jim McCaul, head of IMA, “there is a very strong likelihood that 50 to 75 percent of these projects will actually materialize into equipment fabrication contracts within the next three to five years and another large number of floater projects will undoubtedly surface over the next several years that are not currently on the radar screen.”
Forecast of Orders Up 15 Percent:
Given the strong underlying market fundamentals, IMA’s new forecast calls for 119 to 149 production floater orders over the next five years. This is 15 percent higher than last year’s forecast. According to McCaul, “in the 11 years since IMA has been tracking the production floater market, the fundamentals driving the sector have never been stronger.” He added that the “expectation that crude will remain at $50 to $60 or higher is drawing capital into the floater sector, including more than $3 billion in speculative investment in a dozen production floaters ordered without field contract.”
Details in IMA’s March Floater Report: IMA has just issued an in-depth analysis of the floating production market. The 160 page report provides details for production and storage floaters now in service, profiles all of the known floater projects in the planning pipeline and provides a five year forecast of production floater and storage unit orders. This report is a continuation of a series of reports on the floater market that IMA began in the mid 1990s. The reports, issued at four month intervals, have become a popular reference source in the floater sector.