Global Deepwater and Ultra Deepwater Exploration & Production Market - Growth, Trends, and Forecast (2018 - 2023)
The two-year oil price decline, and resulting plunge in E&P activities and downsizing of assets and personnel by oil & gas companies, appears to be over. Furthermore, operators are intensifying the competition in deepwater projects, by advancing several fronts. Operators have redesigned projects to be more capital efficient. Some large projects are being phased, to reduce upfront outlays and provide flexibility in spend, while smaller fields can use nearby infrastructure to be developed via subsea tie-back. Simple subsea tie-backs that are incremental to an existing field are highly competitive with tight oil. The companies are concentrating on an overall cost reduction in deepwater, mainly through deflation and efficiency improvements.
Recovering Oil & Gas Industry Driving the Market
Offshore oil production accounted for about 30% of the total oil production worldwide, over the past decade. Advancements in dynamic positioning equipment, drilling technology, and floating production and drilling units have made previously unreachable prospectively viable. Production has registered significant growth in the areas of deepwater operations and in several cases, have overtaken shallow water production. The majority of deepwater and ultra-deepwater production occurs in the United States, Brazil, Angola, and Norway. The United States and Brazil accounted for around 90% of the global ultra-deepwater production. With crude oil price crossing USD 60 per barrel mark in November 2017 and touching USD 65 per barrel mark in early 2018, in addition to the benefits offered by Big Data analytics, the deepwater and ultra-deepwater E&P activities are expected to drive the market studied.
US and Brazil Poised to Remain Deepwater E&P activity Hotspots
The United States and Brazil together account for more than 90% of the global ultra-deepwater production. An increasing quantity of Brazil’s production comes from pre-salt resources found under the thick layers of salt, at extreme depths. Brazil increased deep and ultra-deepwater production from 1.3 million bpd in 2005 to 2.2 million bpd, in 2015. International oil majors, including ExxonMobil Corp., Royal Dutch Shell PLC, Total SA, and Chevron Corp., are flocking to the Brazilian deepwaters.
On the other hand, in the United States, the Trump administration is hoping to slash regulations on offshore oil drilling that were implemented after the 2010 Deepwater Horizon disaster. These developments in the United States are expected to have positive impacts on the overall deepwater activities in the country. As of February 2018, there were 46 active deepwater rigs in the United States. Oil majors, such as Shell, BP, Chevron, Anadarko, and Exxon Mobil account for the majority of the rigs in the country, while the deepest of them all is currently being drilled by Petrobras America Inc. at 8835 feet, in the prospect named Chinook. The country is expected to increase its CAPEX for deepwater and ultra-deep water prospects during the forecast period, on account of resurging oil prices. However, the inflated cost of E&P in the deepwaters of US Gulf remains one of the biggest challenges for the market players.
Key Developments in the Market
January 2018: Transocean Ltd closed the acquisition of Songa Offshore SE. Transocean currently owns 187,390,391 Songa Offshore shares, representing approximately 97.5% of the total shares in Songa Offshore, on a fully diluted basis.
March 2018: French oil major Total SA closed Maersk Oil acquisition signed on 21 August, 2017. This deal contributes to Total acquiring around 1 billion barrels of oil equivalent of 2P/2C reserves and resources, mainly in the OECD countries, and a production of about 160,000 barrels of oil equivalent per day (boe/d) in 2018, ramping up to more than 200,000 boe/d by the early 2020s.
The major players include - ExxonMobil Corp., Royal Dutch Shell PLC, Total SA, Chevron Corp., BP PLC, Transocean Ltd, Schlumberger Ltd, Halliburton Co., amongst others.
Reasons to Purchase this Report
Current and future global deepwater and ultra-deepwater market outlook in the developed and emerging markets.
Analyzing various perspectives of the market, with the help of Porter’s five forces analysis.
The segment that is expected to dominate the market.
The regions that are expected to witness the fastest growth during the forecast period.
Identify the latest developments and strategies employed by the major market players.
3 months analyst support along with the Market Estimate sheet (in excel).
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