Analysts predict deepwater spending will top $167 billion through 2014
Douglas-Westwood Research has produced an appraisal of anticipated worldwide deepwater expenditures over the five years to 2014 that concludes US$167 billion will be spent - an increase of 37% over the preceding five years.
Analysts Douglas-Westwood released its World Deepwater Market Report 2010-2014 today. It reveals that sector activity will largely remain within the, "golden triangle" of Africa, the Gulf of Mexico, and Brazil, with regional investment representing over three-quarters of the predicted global capital expenditure. The majority of "golden triangle" investment, however, will take place in Latin America, driven largely by the capital-intensive development plans laid out by Petroleo Brasileiro (Petrobras) over the next decade. The report also highlights that Asian deepwater markets will continue to grow during the forecast period, receiving around 10% of the total predicted global investment.
Steve Robertson, director at Douglas-Westwood, said, "The lack of new opportunities onshore or in shallow waters, together with the need to offset decline from existing reservoirs, is driving deepwater investment at a much higher rate than in previous years. In addition, technological advances have improved the economic viability of developments much further offshore."
The Report also reveals that operators have exerted substantial pressure on their supply chains during 2009, achieving reductions of up to 15%. This confirms operator purchasing power has returned but that renewed sector growth could encourage cost inflation in some equipment and service markets. "We, therefore, expect the operator community to exert even more influence over the next five years to prevent a repeat of the unchecked inflation experienced between 2003 and 2008," said Thom Payne, lead analyst at Douglas-Westwood.
03/11/2010