GBI Research’s report, “The Future of the Offshore Oil and Gas Industry to 2020”, provides an in-depth analysis of the offshore oil and gas industry, highlighting the various concerns, shifting trends and emerging regions in the global offshore oil and gas industry. The report also provides in-depth analysis of key trends and challenges faced by the global offshore oil and gas markets. It provides the current and forecast offshore oil and gas production and reserves for major offshore regions of the world. The report provides an analysis of the competitive scenario and highlights the fiscal regimes in the major offshore regions. Additionally, the report provides forecasts on the offshore drilling spend to 2020. The report also analyzes the major offshore projects globally and provides asset valuations for some major offshore projects.
Depleting Onshore Reserves, Discovery of New Large Offshore Reserves and Adoption of New Technologies are Driving the Growth of the Global Offshore Oil and Gas Production
The global offshore oil and gas industry is expected to continue to increase in the coming years. Global offshore crude oil production was 9,349 million barrels and global offshore natural gas production was 26,807 bcf in 2008. With a positive outlook and the continuing trend for the offshore industry, the global offshore crude oil production is expected to increase to 9,852 million barrels by 2015. On the other hand, the global offshore natural gas production is expected to increase to 27,045 bcf by 2011. According to GBI Research estimates, the Global offshore crude oil production is expected to be 9,481 million barrels and Global offshore natural gas production is expected to be 26,544 bcf by 2020.
World Offshore Drilling Spend is Expected to Recover by 2010 and Continue to Grow in the Future
Global offshore drilling spend has increased in recent years, particularly during the period of 2004 to 2008. According to GBI Research estimates, approximately $350 billion was spent on offshore drilling during 2000-2008. Regions accounting for the major share of the spending were the US Gulf of Mexico (USGOM), West Africa, Brazil and Asia Pacific. Offshore drilling spend had peaked in the period of 2007 to 2008.
However, various factors such as the global economic slowdown, decrease in demand for oil and gas, and a drop in the prices of crude oil and natural gas, are expected to have a negative effect on the offshore drilling activity in 2009. Nonetheless, with the global economy expected to recover by 2010, the global exploration and development activity is expected to increase. According to GBI Research estimates, more than $490 billion is expected to be spent on offshore oil and gas drilling during 2009-2015.
The Global Offshore Industry is Witnessing a Shift in Investment to New and Emerging Offshore Regions
In the recent years, there has been a growing trend in investments in the offshore oil and gas industry. Offshore areas in the USGOM and the North Sea in Europe were traditionally the hotspots for investments in the last decade. However, recent discoveries of offshore fields with huge reserves in various other regions of the world have started a shift in investments from mature regions such as North Sea to offshore areas in Brazil, West Africa and Asian countries such as China and Vietnam.
The drilling spend offshore regions of Brazil, West Africa and Asia Pacific was $180 billion and accounted for more than 50% of the $350 billion spent on offshore oil and gas drilling globally from 2000 to 2008. According to GBI Research estimates, the drilling spend in the offshore regions of Brazil, West Africa and Asia Pacific is expected to be over $300 billion, which is almost 60% of the more than $490 billion expected to be spent during 2009-2015.
Exploration and Development Moving Towards Deep, Ultra Deep Sub-salt Reserves
The recent years has witnessed an increasing trend towards deep water exploration. With the decline in available resources in the onshore areas, there was a move towards increased offshore exploration. There have been huge deep water discoveries in various regions of the world, from Brazil and the USGOM to West Africa and Asia Pacific regions. In the USGOM alone, there has been decreased activity in the shallow water areas. Natural gas production, which was the mainstay of shallow water activity in the USGOM, has seen a steady decline in the recent past.
Another major factor promoting increased activity in the deep and ultra deep waters has been the advancements in technology. Perdido will be the deepest production platform in the world operating at depths of 8,000 feet under water. Petrobras’ FPSO, to be introduced next year, is a converted double hulled tanker that can operate at extreme water depths and will also have a detachable turret buoy to be used during hurricanes while the FPSO can be moved to safer waters.
Tupi Field, which was discovered in November 2007, is the largest discovery in North and South & Central Americas since 1970. It has estimated recoverable reserves in the range of 5-8 billion barrels. As shallow water resources decrease, deep and ultra deep sub-salt areas will play an increasingly significant role in the offshore oil and gas production.
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