August 2016

The North Sea Oilfield Service Market - Dead or alive?

Oil Price & UK North Sea 

Content webinar

August 25, 2016
11.00 - 11.30 am (BST) 

Speaker: Mark MacLean, Head of UK office

Sign up

 


The offshore oilfield service market in Southeast Asia

Content webinar

Speaker: Oddmund Føre, 
Senior Analyst

Request Recording

 


Rystad Energy has the great pleasure of inviting you to our Annual Oil & Gas Summit 2016, which is happening in conjunction with our regular user meeting. This year our key event will take place in Houston and London. Join us to hear about our up-to-date market analyses and overview, industry perspectives and data analysis discussions.

September 20-21, 2016
Houston, United States 

October 5-6, 2016
London, United Kingdom

Read more

 


Article: Lowest offshore project commitments since 1998


Article: Increased field decline on mature fields is becoming visible


RYSTAD ENERGY PRODUCT HIGHLIGHTS

Oilfield Service Databases

• DCube (Demand Database): Field-by-field coverage for the global oilfield service companies and their spending

In the latest DCube version (June 2016), overall purchases stay the same, but the P&A market has been increased based on the latest update of decommissioning plans. 

• SCube (Supplier Database): Detailed insights into revenues of the largest oilfield service companies

Q2 2016 version of SCube shows that revenues among service companies continued to fall in 2016 as Q1 2016 reported revenues were 16% lower than those for Q4 2015. The fall varied across service segments and geographies, causing large changes in the company’s market shares.

• RigCube (Rig Supply & Demand Database): Insights into historical and forecasted global rig supply and demand

There are still challenges in the MODU market. Q2 2016 RigCube version shows that demand for floaters in 2016 will decrease by 24% y/y. For jack-ups, demand will fall by 14% compared to 2015 levels.

CONTACT
products@rystadenergy.com

OFS Newsletter Subscription: If you are not yet a subscriber to this email or you would like to receive one of our other industry newsletters, 
please fill out the Newsletter Subscription Form

The oilfield service markets in Norway and the United Kingdom have felt the market downturn harder than other offshore nations. Deep cuts in activity and pressure on price have led to mass lay-offs in Stavanger and Aberdeen. But is the oilfield service industry in this region dead or alive?

 

From 2014 to 2016, the average decline in the service market in Norway and the United Kingdom was 17% and 23%, respectively. This decline was the result of many factors. Both Norway and the UK witnessed extraordinary activity in the years from 2010 to 2014 in terms of new developments. Projects such as Ivar Aasen, Edvard Grieg, Martin Linge, Goliat, Quad 204, Clair Ridge and Laggan-Tormore drove up investments and prices. Upon project completion and oil price fall last year, few new projects were sanctioned; drilling activity and brownfield work were delayed, and suppliers’ contracts were renegotiated at lower terms. Norwegian suppliers reported for 2015 a drop in revenues of 16%, where most of this was driven by the EPCI market and due to less equipment sold to the international market. Internationally, the offshore market held a greater stand in some regions. UAE and Saudi Arabia had increasing investments in new offshore production capacity, Brazil was still in the ramp-up phase of production and South East Asia had sanctioned many fields in the recent years. There are large differences among the various offshore countries, but the overall onshore market fared worse, decreasing by 21% on average in both 2015 and 2016.

Looking beyond this downturn, towards 2020, should calm the suppliers. Although nearly 150,000 people have lost their oil-related jobs in Norway and UK, there are brighter times ahead. In fact, both countries are expected to experience a sharper comeback than the international offshore market. Norway could grow 170 basis points more every year towards 2020 and UK by 30 basis points more. In 2020 both countries would be back at more normal levels, similar to those in 2012. 

The drivers behind this recovery sit with new field developments, increased MMO and decommissioning activity along with improved service prices. There are potentially 30-40 projects to be sanctioned in 2017 and 2018, with the largest contributing to more than $40 billion in new contracts. 2016 has been extraordinarily weak; however, projects such as Utgard and Oseberg Western Flank have been sanctioned. 2016 has been extraordinarily weak, however projects such as Utgard and Oseberg Western Flank have been sanctioned. 2017 is really the year where the E&P companies will commit to new project developments. Castberg and Rosebank have been recycled and ready to go and Snadd will benefit from lower service prices. All of this will create sought for contracts to the suppliers. In 2018, the second phase of the Johan Sverdrup field is expected to be sanctioned, unlocking $10 billion alone. Higher oil prices in 2018 will generate even more opportunities for that year and beyond, and North Sea suppliers should feel much more alive.

..........................

 

 

Stop by exhibit #264 to meet with our Rystad Energy experts who will be presenting on oilfield service topics. Program below:

Tuesday, 30 Aug
Time Speaker
10am:

Audun Martinsen, VP Analysis, speaks on
Global Oilfield Service: Beyond the darkes; a new dawn

11am: 

Jon Fredrik Müller, Partner, speaks on
Technology: How can innovation contribute to increased efficiency?

12pm:

Lars Eirik Nicolaisen, Partner, speaks on
Offshore Rig: Attrition is key as industry reels

 


 

Thursday, 01 Sep
Time Speaker
10am:

Erik Reiso, Partner, speaks on
Global Oilfield Service: Beyond the darkes; a new dawn

11am: 

Jon Fredrik Müller, Partner, speaks on
Technology: How can innovation contribute to increased efficiency?

12pm:

Oddmund Føre, Senior Analyst, speaks on 
Offshore Rig: Attrition is key as industry reels


Contact us for one-on-one meetings: 

Contact: Stavanger@rystadenergy.com