March 2009 Vol. 236 No. 3


Global Subsea Sector Market Expenditures To Top $80 Billion

Infield Energy Analysts recently released its 2009-2013 forecast for the global subsea sector. According to the report, total five-year global subsea sector expenditures (subsea equipment and drilling and completions) will exceed US$80 billion. This is up from US$46 billion in the previous five years.

The reports gave considerable discussion to subsea trees, noting that 3,222 trees are expected to be started up within the next five years with the biggest players being Petrobras (374), Shell (244), Total (237), Chevron (236), BP (229), ExxonMobil (215) and StatoilHydro (194).
The report states that over the past five years there has been a rapid expansion of subsea trees installed and that the majority of this activity is linked to the growth of the deepwater oil and gas industry. The analysts warn that the global industry continues to face a combination of challenges, including: declining shallow water production, falling reserves in place and poor shallow water prospects.

Problems are projected in the deepwater market that has flourished from stable oil prices which remained consistently above $30 a barrel. The next few of years should see a plateau of activity levels as constraints within the market are realized. This was expected prior to the banking crisis and oil-price declines as capacity constraints within the supply chain and rapid inflation led operators to prioritize the most-profitable projects.

Limited access to financing and lower price may impact viability of future projects. Smaller, single-well tie-backs can have sanction rates of up to $65 barrel whereas larger floating projects can be sanctioned at as little as $23 barrel. For this reason, the study projects smaller projects in Europe and in Southeast Asia are most at risk and could see potential delays and cancellations.
The report suggests the future for the subsea industry will be very strong with a variety of depths, project sizes and locations expected in the next five years. For information visit

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