FPSO operator BW Offshore returned to profit in the fourth quarter 2017 while its revenues for the quarter nearly halved when compared to the same period of 2016.
BW Offshore on Thursday posted a profit of $47.2 million for 4Q 2017 compared to a loss of $114.4 million in the fourth quarter of 2016.
The company’s operating revenues for 4Q 2017 were $150.3 million compared to $298.2 million in the corresponding period of 2016.
The majority of BW Offshore’s fleet remains on long-term contracts with national and independent oil companies.
According to the company, the start-up of production from FPSO Catcher at the end of 2017 will be a significant contributor to group cash flow in 2018 and in the years to come.
BW Offshore said that offshore production of oil and gas is expected to decline after several years of low investments. This will likely become more evident in coming years, as production tied to investments made in the previous up-cycle has now started and will start to decline.
The company also said that the overall market balance has improved with a declining oversupply of crude oil. In addition, the industry has become more effective in bringing down break-even costs for new developments. This is expected to lead to sanction of new projects which will further improve the market outlook for offshore field developments.
Initially, the company expects increased focus on incremental investments to existing infrastructure, but later in the cycle more green-field investments may emerge.
BW Offshore added it is seeing improved market activity for FPSOs.
Offshore Energy Today Staff