Floating Production Market Going Gangbusters
The global oil and natural gas markets are contending with rebounding energy demand on top of supply disruptions from Russia’s invasion of Ukraine. As a result, activity and business sentiment in the floating production sector have seldom been stronger.
Brent crude has been trading above $100 over the past three months, generating record profits for E&P operators -- providing an incentive to increase capital expenditures on new development projects.
Several FPSO projects have moved into the near-term contract queue, raising to 31 the number of oil/gas production floater contracts lined as of end-May for award over the next 18 months – provided enough supply chain capacity is available.
Two oil/gas production floater projects moved to the investment stage over the past month – a redeploy contract for a production semi in the GOM and an engineering contract designed to morph into a lease and operate contract for an FPSO in Brazil.
Perhaps most impressive has been the large number of FSRUs leased on a long-term basis over the past few weeks.
Seven FSRU long-term leases were signed in May by European utilities scrambling to replace Russian gas pipeline deliveries. These leases pretty much vacuumed up most of the available FSRUs that had been looking for terminal contracts. Driving the order surge has been the threat of a partial or complete shutdown of Russia’s pipeline gas to Europe.
A detailed review of recent activity in the floater sector is provided in WER's monthly floater report issued on 29 May. In our May report we provide a review and analysis of the floating production market – and in the data section of the report are details for 190 floater projects in the planning stage, 67 production or storage floaters now on order, 304 floating production units currently in service and 22 production floaters available for redeploy contracts.
For more information on how to access the full report please contact Michael Kozlowski at +1 561-733-2477 or [email protected]