The largest component of forecast offshore Oil Field Equipment (OFE) expenditure will be fixed and floating production equipment, totalling $139 billion, bolstered by activity in Latin America, particularly Guyana, where regional expenditure on the floating platform sector is set to peak at $15 billion in 2022.
According to a forecast from energy market research and intelligence company Westwood, investment continued to recover within the OFE sector, from a low of $93 billion in 2016 to $107 billion in 2019. Based on current projections, OFE expenditure is expected to continue to increase into the 2020s, reaching a forecast peak of $133 billion in 2023.
First oil from Guyana’s Liza development in the Stabroek block was achieved in late-December 2019 and Westwood said the five FPSOs which are expected to be deployed on the block over the forecast will lead Guyana’s oilfield equipment expenditure to reach a peak in 2022.
With 16 discoveries made so far at the Stabroek Block, multiple exploration prospects remain in play that could push the resource estimate even higher than the 8 billion barrels plus released by ExxonMobil in January. This in turn could increase the need for more FPSOs.
The 8 billion boe includes 15 discoveries at Stabroek through year-end 2019, including its 14th find Tripletail and 15th find Mako made in second-half 2019. Uaru is the first find of 2020 and will be added to the resource estimate at a later date, ExxonMobil has said.
In addition to the first FPSO – the Liza Destiny, two more vessels are in play; the Liza Unity for the already sanctioned phase 2 Liza development, and Prosperity, for a third development at Payara which is pending approval. All the FPSOs to date are under contract with Dutch floater specialist SBM Offshore.