WoodMac: Norway takes charge during offshore market recovery

Norway is leading the way during the offshore market’s gradual recovery, according to Mhairidh Evans, senior research analyst at Wood Mackenzie’s offshore supply chain team. 

Illustration; Source: Maxpixel

According to WoodMac, offshore drilling activity plummeted since the oil price crash, dropping 36% globally between 2014 and 2017.

WoodMac said that the ramifications for the rig market were huge. Utilization of the global floating rig fleet fell from 90% to 65%, and day rates were slashed by up to 70%.

In the North Sea, the decline wasn’t as dramatic as the global picture. High levels of sanctioned projects pre-downturn, and ongoing drilling campaigns at giants such as Troll and Ekofisk, meant activity dropped by only 20% from 2014 – 2017.

Speaking at the Offshore North Sea (ONS) Conference in Stavanger, Evans said: “Looking to the future, we expect the global recovery in the offshore market to be cautious and gradual.

“However, momentum in the Norwegian market means the NCS is leading the way and is one of the world’s hottest offshore markets for now. About 40% of all subsea Xmas trees ordered globally in 2017 will be delivered to Norwegian fields (compared to previous levels of 10 – 15%).

“And for rigs, a combination of increased demand and tight supply has meant rates within the specialist harsh environment fleet are rising the fastest of any sector.”

Wood Mackenzie also estimated a 25% increase for 2018 harsh environment day rates compared to 2017, with further inflation expected for 2019.

“But the longer term outlook may sound alarm bells for the Norwegian sector. Poor exploration results have meant a drying up of the project pipeline, and operators are having work harder to grow their portfolios from existing discoveries.

“Wood Mackenzie forecasts year-on-year declines in NCS drilling activity out to the early 2020’s. Meanwhile, projects being planned in the deepwater sectors of Africa and Latin America promise bigger prizes for the supply chain. More investment will be required to keep the NCS near the top of the tree,” added Evans.

Share this article

Follow Offshore Energy Today

Events>

<< Mar 2019 >>
MTWTFSS
25 26 27 28 1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31

16th MOSCOW INTERNATIONAL OIL AND GAS EXHIBITION

The Moscow International Oil & Gas Exhibition display products like oil and gas products, oil and gas services…

read more >

Beijing International Offshore Oil & Gas Exhibition (ciooe) 2019

Beijing International Offshore Oil & Gas Exhibition (ciooe), is a regular gathering in oil & gas industry…

read more >

Lebanon International Oil & Gas Summit 2019

LIOG 2019 will delve further into the opportunities that are present in Lebanon’s energy sector…

read more >

Atyrau Oil & Gas 2019

The event program is dedicated to the most topical issues of search, exploration, development of hydrocarbons…

read more >

Jobs>

Looking to fill a job opening?

By advertising your job here, on the homepage of OffshoreEnergyToday.com, you'll reach countless professionals in the sector. For more information, click below...

apply

Looking to fill a job opening?

By advertising your job here, on the homepage of OffshoreEnergyToday.com, you'll reach countless professionals in the sector. For more information, click below...

apply

Looking to fill a job opening?

By advertising your job here, on the homepage of OffshoreEnergyToday.com, you'll reach countless professionals in the sector. For more information, click below...

apply