Subsea Asia Asia Subsea Market Overview into the deep... Julian Callanan Infield Systems

Transcription

1 2010 Subsea Asia 2010 Asia Subsea Market Overview into the deep... Julian Callanan Infield Systems

2 Agenda 1. Introdution to Infield 2. Maro Market Review Global Prodution / Consumption Further, Deeper, Harsher 3. Bad things ome in 3 s Global reession Gas market unertainty Transoean Horizon inident 4. Subsea Asia Outlook 2

3 Infield Systems Ltd Infield Systems Ltd

4 Agenda 1. Introdution to Infield 2. Maro Market Review Global Prodution / Consumption Further, Deeper, Harsher 3. Bad things ome in 3 s Global reession Gas market unertainty Transoean Horizon inident 4. Subsea Asia Outlook 4

5 MMBBL Setting the sene Maro Context Prodution Consumption Energy onsumption shift 2003 to reent reession marked a shift in global onsumption patterns A bakdrop of growing energy onsumption from an inreasingly diverse regional basis meant a tight onstrition between prodution and onsumption through 2006 to The offshore industry reated by going Further, Deeper and Harsher... Energy onsumption shift Driven by rise of Asian regions Energy onsumption shift Speifially China and India key prospetive gas export markets 5

6 Setting the sene Further... Fields on-stream in the 1960 s 6

7 Setting the sene Further... Fields on-stream in the 1970 s 7

8 Setting the sene Further... Fields on-stream in the 1980 s 8

9 Setting the sene Further... Fields on-stream in the 1990 s 9

10 Setting the sene Further... Fields on-stream in the 2000 s 10

11 Setting the sene Further... Future fields to ome on-stream 11

12 Setting the sene Harsher... USGS estimates yet to be disovered reserves: 90bbl 1,670tf Russia and the Arti Laying flags on the sea floor? Exploration enouraged by salary? Shtokman Delayed for 3 years Lak of funding Design hallenges Delay to Nordstream Gas market unertainty 12

13 Water Depth(m) Setting the sene Deeper... MAX AVG MIN Year On-stream Average Subsea Well Waterdepth Average Subsea well depth now 964m, with good prospets for inrease Deepest 2009 Subsea Wells 2126, relating to PBR Tupi EWT 2743, Anadarko s Lloyd Ridge 050 Atlas (AVP) Subsea Wells On-stream and Water Depth Trends Deepest 2010 Subsea Wells 2934, Shell Tobago tied into Perdido Host 6000m Abyssal Plain If the max waterdepth trend line is extrapolated forwards, it would take 15 more years for the deepest point on the abyssal plain (6000m) to be tehnially feasible m Mariana Trenh Bottom of the Mariana trenh in ~30 years? Deepest spot in the world >10,000m 13

14 Subsea Tehnology Helping Push Operational Boundaries Field Development shemes : Floating 5% No Development Sheme yet announed 24% Fixed 32% Extended Reah Drilling 7% Subsea 29% Fixed & Floating 3% No Development Sheme yet announed 15% Fixed 1% Floating 10% Extended Reah Drillinig 1% Subsea 73% No Development Sheme yet announed 14% Floating Prodution 31% Subsea 55% Shallow Waters 500m 1000m 1000m+ Please note, any floating or fixed platform with subsea wells has been lassified as Subsea. Fixed or Floating therefore refers to dry well development shemes. 14

15 Agenda 1. Introdution to Infield 2. Maro Market Review Global Prodution / Consumption Further, Deeper, Harsher 3. Bad things ome in 3 s Global reession Gas market unertainty Transoean Horizon inident 4. Subsea Asia Outlook 15

16 The reession and offshore markets The global reession had a huge impat on the offshore industry: Oil Prie Changes The volatility of oil prie has resulted in the deferral of many projets The oil prie has reently stabilised between 60 and 80 dollars a barrel Above the majority of field santion pries Credit runh Lak of aess to apital has lead to the deferral of projets by those operators that either are not ash rih or are exposed to investor unbundling, suh as Smaller Independents (North Sea/Asia) Supply Chain Over the past 3 years the offshore industry has overheated with signifiant prie inflation aross the setor Oil ompanies tolerane of inflation has dereased in-line with the oil prie. Resulting in the squeeze of the supply-hain through the delay of awards and erosion of baklogs 16

17 Gas Prie ($/mf) Gas Markets Oil and Gas pries deouple Key Drivers & Trends Oil and gas pries have historially been orrelated (as the orange trend line shows below). When pries are low or high, orrelation is the strongest. Today s gas pries are anomalously low; potentially due to an inrease in gas supply, oupled with a derease in demand Q Commodity boom, onern about supply meeting the demand of developing ountries suh as India and China mixed with militant attaks in Nigeria, Piray in the Gulf of Aden and the War between Russia and Georgia (Supply Threats) 6 4 Today Oil prie reovered quikly from reent lows. Gas pries muh more sluggish, a market whih feels like it is moving towards over-supply? Oli Prie ($/bbl) 17

18 Gas Markets - Shale Gas Key Drivers & Trends North Amerian Shale Gas has been the largest ause of inreased gas supply. This has been seen at a time of redued gas demand, and as suh has worked to lower global gas pries. North Ameria Shale Gas Prodution Considered a game hanger in the gas markets Shale Gas developments have been pioneered by Independent operators in North Ameria. Shale gas drove US estimated natural gas reserves up by 35% to 2074 trillion ubi feet in Shale gas prodution is foreasted to aount for a quarter of US gas by 2025, up from around 10% in Potential of Shale Gas will ensure suffiient US gas supply for several years. Europe Shale Gas Exploration Exploration of Shale Gas potential is being arried out by larger Integrated Oil Companies (IOCs) e.g. Exxon, Conoo Phillips Mass prodution of European shale gas is unlikely in the short to mid term due to tehnologial and geographial fators. Abundant LNG supply being delivered to Europe a onsequene of redution in gas demand in US. This is helping to keep gas pries low, and in turn lowering the potential of short term shale gas developments. Asia Shale Gas Exploration China; PetroChina and Sinope are in disussions with Royal Duth Shell and BP respetively to study shale. India; ONGC has teamed up with Shlumberger to develop unonventional plays. 18

19 TO Horizon Potential Impats Short-term: 6month moratorium on offshore drilling in GoM Fore Majeure applied by operators to exit rig ontrats Controls over expansions of drilling programs e.g. California, Eastern reahes of the GoM Depressed D & UD day rates Likely shift of rig assets from GoM to other deepwater markets Long-term Cannot deny the importane of deepwater E&P. However likely to now be under striter terms. New legislation over equipment testing and maintenane will likely inrease rig spreads. Inreased D & UD expense likely to inrease attrativeness of other energy forms; Shale, Coal bed methane, Deep gas. 19

20 Total prodution rate (BPDE) A world without BP or Deepwater? 6,000,000 5,000,000 Foreasted Prodution Rates Foreasted Prodution Rates Less BP 4,000,000 3,000,000 2,000,000 Figure 2: Total GoM Offshore Capex (ISL Offex TM ) 1,000, Figure 3: US GoM Deepwater Prodution Foreast (ISL Offex TM ) Despite the hallenges assoiated with deepwater E&P, so muh future prodution is assoiated with this market, that to ban drilling in deeper waters is not a realisti option. Rather, we are likely to see inreased legislation around drilling ativities, pressure on government bodies and operators to draw up more far reahing ontingeny measures, and inreased pressure for the diversifiation of energy prodution from other safer soures. 20

21 Number of Subsea Trees $m Number of Awards Number of Subsea Trees Impat on the subsea industry Redution in tree awards 5,000 4,500 4,000 3,500 3,000 Awarded Unawarded Tree Awards Aker Solutions Cameron Dril-Quip FMC GEOG VetoGray Unknown 600 2,500 2,000 1,500 1, Award Year Not Awarded Awarded Early tree orders Some trees are held in storage by oil ompanies so the relationship between award and exeution is not onstant. We spend a great deal of time trying to work out whih tree orders will go to whih projet. Petrobras tree award to Cameron 138 PBR to Cameron order ruial in keeping these numbers high Awarded market 75% of where we would expet it to be Without PBR market would be about 50% of histori levels On-Stream Year 21

22 Agenda 1. Introdution to Infield 2. Maro Market Review Global Prodution / Consumption Further, Deeper, Harsher 3. Bad things ome in 3 s Global reession Gas market unertainty Transoean Horizon inident 4. Subsea Asia Outlook 22

23 Tree Installations Tree Installation Foreast good mid-term prospets Vietnam South Korea Russia (FSU) (Sakhalin) Philippines Myanmar Malaysia Indonesia India China (PRC) Brunei Note: Key future markets: Malaysia, Indonesia, India and China Note: Installations seriously low in 2010 and However market looks likely to boune bak strongly. 23

24 Awards TiebakName TiebakModelYear Operatorgroup Country Grand Total P & M Field FPSO (KG-DWN-98/2) 2016 ONGC India Terang/Sirasun FPSO (TSB) 2011 Energi Mega Persada Indonesia Gumusut Kakap FPU 2011 Shell Malaysia Kikeh FPSO 2007 Murphy Malaysia Aster/Tulip FPSO 2014 Eni Indonesia Liwan LW PUQ 2012 Husky China (PRC) West Seno TLP-A 2003 Chevron Indonesia West Linapaan FPSO (Phase 2) 2014 Philodrill Philippines Gendalo FPSO 2014 Chevron Indonesia Malikai TLWP 2013 Shell Malaysia Grand Total Mid-term prospets underpinned by some big projets 24

25 Number of Trees Number of Trees Long-term Prospets Prodution Injetion Asia Subsea Well Installations North Sea Subsea Well Installations Observation Prod/Inj Prodution Injetion Comparative example of amount of subsea installations in Asia vs North Sea Only started to note the growth of injetion wells in Asia, in the North Sea, these aount for about a fifth of installations. Currently muh Asian development is foussed on green field. There exists a huge longer term opportunity for the seondary and tertiary phases of development of these fields, and, further down the line, of the growth of an injetion market

26 Conlusion 1. Introdution to Infield 2. Maro Market Review Global Prodution / Consumption Further, Deeper, Harsher 3. Bad things ome in 3 s Global reession Gas market unertainty Transoean Horizon inident 4. Subsea Asia Outlook 26

27 Thanks Julian Callanan Infield Systems

28 Dislaimer The information ontained in this doument is believed to be aurate, but no representation or warranty, express or implied, is made by Infield Systems Limited as to the ompleteness, auray or fairness of any information ontained in it, and we do not aept any responsibility in relation to suh information whether fat, opinion or onlusion that the reader may draw. The views expressed are those of the individual ontributors and do not represent those of the publishers. Some of the statements ontained in this doument are forward-looking statements. Forward looking statements inlude but are not limited to, statements onerning estimates of reoverable hydroarbons, expeted hydroarbon pries, expeted osts, numbers of development units, statements relating to the ontinued advanement of the industry s projets and other statements whih are not historial fats. When used in this doument, and in other published information of the Company, the words suh as "ould," "estimate," "expet," "intend," "may," "potential," "should," and similar expressions are forward-looking statements. Although the Company believes that its expetations refleted in the forward-looking statements are reasonable, suh statements involve risk and unertainties and no assurane an be given that atual results will be onsistent with these forward-looking statements. Various fators ould ause atual results to differ from these forward-looking statements inluding the potential for the industry s projets to experiene tehnial or mehanial problems or hanges in finanial deisions, geologial onditions in the reservoir may not result in a ommerial level of oil and gas prodution, hanges in produt pries and other risks not antiipated by the Company. Sine forwardlooking statements address future events and onditions, by their very nature, they involve inherent risks and unertainties. Copyright Infield Systems Limited Data, harts, images and information ontained within this doument are proteted by international opyright and as suh may not be opied, reprodued, transmitted or utilised in any form or format without the express written permission of Infield Systems Limited. 28