ULTRA-DEEP GROWTH: $378 BLN
Apparently undeterred by low oil prices, oil & gas output from ultra-deepwater (>1,000m water depth) fields will continue the relentless growth seen in recent years. In the latest World Drilling & Production Forecast, Douglas-Westwood predict combined oil & gas production from such fields will grow 7.7% year-on-year over 2015-2021 from 6.5 mboe/d to 10.2 mboe/d. This will come from the drilling of 1,470 ultra-deepwater wells, an increase of 68% on the seven years prior. A key factor is that at these water depths, only the most highly productive plays are being targeted. Additionally, deepwater projects typically have funding secured several years ahead of first production – hence the projected medium term growth.
Leading the way with increased production will be the historically big deepwater producers – Angola, Brazil, Nigeria and the US. The latter will see the strongest growth of the four with ultra-deepwater oil output set to climb from 1.5 mboe/d in 2015 to 2.1 mboe/d in 2021. This will be the result of 11 floating production platforms being brought online, including the recent additions of Anadarko's Lucius spar, Llog's Delta House and Chevron's Jack/St. Malo (both floating production semisubmersibles). This, combined with Petrobras' continuing success in Brazil's pre-salt reservoirs and West Africa's ultra-deepwater plays apparent resilience to the oil price downturn, global ultra-deepwater production will rise from 6.5 mb/d in 2015 to 10.1 mboe/d in 2021.
It must be noted, however, that such projects will be vulnerable to cancellation and delay in the long term should the current low oil price situation be sustained. Operators may look to improve the economics of projects currently in the pipeline by boosting reserve bases through conducting additional appraisal activity – well demonstrated by Statoil's recent gas discoveries in the area around the site of the future Aasta Hansteen spar.
DW anticipate $378 billion will be spent on floating production platforms and subsea hardware over the next seven years. Forty-five percent of this will be spent on ultra-deepwater fields, reflecting their importance in the global oil & gas supply picture.
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