Some industry insiders have doubts about whether there is sufficient offshore contractor capacity to deal with the expected volume of business.
2020 is likely to be a busy year for offshore oil and gas offshore contractors. Current data suggests that the number of projects given the go-ahead will increase from 160 in 2016 to 250 new offshore schemes in 2020, reports Rystad Energy [i]. Some industry insiders have doubts about whether there is sufficient contractor capacity to deal with such a volume of business.
In Rystad Energy’s latest market report on the global service market, floating production contractors, subsea installation service suppliers and fabricators of liquefied natural gas facilities, are likely to experience problems coping with increasing demand from their exploration and production customers for their services.
This means that because of insufficient industrial capacity to meet the increase in market activity, it is likely that many projects could face delays and increases in costs. This will mean that offshore contractors will be–for the first time since 2014 oil crash–price makers, rather than price takers as energy companies bid for their services.