Mark J. Kaiser, Louisiana State University
FPSOs are an essential part of offshore development and are an important component of the global production of offshore oil. They are a mature and proven technology, have excellent economics and operational uptime, with significant spin-offs such as FLNG and FSRUs. FPSOs have also evolved a lease procurement practice that transfers the financial burden from the field operator to a contractor for both construction and operational responsibility.
While all FPSOs perform similar production, storage and offloading functions, each is designed and outfitted for a specific field development. The result is a diverse inventory of FPSOs with vast differences in processing capacity, storage volumes, riser configurations, mooring design and construction cost.
In this five-part series, we examine some of the principal features of FPSO units and how they relate across the fleet. In this first part, the current inventory and lifecycle dynamics of FPSOs are reviewed.
In the next (second) part we will show how to distinguish between oil FPSOs and gas FPSOs. Then, to gain a better understanding of the interdependence of FPSO parameters, we will examine (3) hull dimensions vs. deadweight, (4) storage volume vs. deadweight, and (5) topsides weight vs. processing capacity.
Offshore production highlights
In 2024, offshore crude and condensate production was approaching 30 million barrels per day (MMb/d) and contributing about one third of world production (Figure 1).
Shallow-water production far surpasses deepwater production, but the gap is narrowing as the world’s shallow-water basins deplete and deepwater regions increase. In 2024, shallow-water (<400 m) water depth contributed around 17 MMb/d with deepwater basins (>400 m) were responsible for about 13 MMb/d.
Top offshore crude producers in 2024 were Brazil at 2.2 MMb/d, followed by the US at 1.8 MMb/d, Norway at 1.8 MMb/d, and Angola at 1.1 MMb/d.
Angola quit OPEC in January 2024 over a disagreement regarding production quotas as it tries to revitalize the sector.
FPSO inventory
Circa 2024, there were 169 active (producing) FPSOs, 14 idle units available for use, and 33 units under construction (169/14/33).
Inventory numbers in each category (active, available, under construction) change each year, of course, but the changes in each category are usually small, moving up or down by a handful of units each year. This is due to the long-term nature of field production, high residual value of idle units, and prolonged period for construction and upgrading.
For example, the number of active/available/construction units totaled 174/25/25 in 2019 and 163/16/30 in 2022.
Active and available FPSOs
The number of active and available FPSOs worldwide hit its peak from 2016 to 2020 at around 195-200 (Figure 2). Today, there are 183 active and available units.
Of the 166 active units about 58% (96) are conversions, 34% (56) are newbuilds, and 8 (14) are redeployments.
Units under construction
South America is the destination for most of the new units. Brazil tops the list for FPSOs on order, with 15 FPSOs under construction. Petrobras’ ultra-deepwater Buzios development with Chinese partner CNOOC requires 11 FPSOs and a 12th unit is under consideration; 5 units have already been deployed. Exxon has 4 FPSOs under construction in Guyana (Payara, Yellowtail, Whiptail, Uaru).
The North Sea has 5 FPSOs, Africa 4 FPSOs, and Southeast Asia has 2 FPSOs under construction.
Inventory dynamics
As fields deplete and production is no longer economic, units are decommissioned and subsequently enter the available (idle) supply, where they are laid up for one or more years until redeployed, find another use (e.g., FSO) or scrapped (Figure 3).
After an award is made, shipyards begin the construction or upgrading process which may take between 2 to 5 years or more to complete. Upon completion, units enter service, either by newbuild or conversion pathways.
Units available for conversion compete with newbuilds on price and schedule. Units that find another use or are scrapped are permanently removed from the available inventory.
FPSO locations
FPSOs are used in 29 countries worldwide in all types of environments and water depths. Brazil tops the list with 46 active units, and together with the UK (18), Angola (16), Nigeria (15), and China (14), comprise about 60% of the active fleet c.2024.
FPSOs have been employed in water as shallow as 30 m to ultra deepwater approaching 3,000 m, from the cold, windy high latitude regions where ice and icebergs, fog, snow and icy rain occur, to warm, wet equatorial regions, and the seasonal mid-latitude regions with extreme wind events such as hurricanes, typhoons and cyclones.
FPSOs have been installed in the harsh waters of the northern North Sea, West of Shetlands, and Barents Sea above the Arctic Circle, to the rough and cold Tasman Sea offshore New Zealand. FPSOs have been installed in the iceberg-infested waters off Newfoundland, hurricane alley in the Gulf of Mexico, and the typhoon-ridden South China Sea and Timor Sea of northwest Australia.
About half of the active FPSO fleet reside in shallow water <400 m with the remaining half in deepwater (Table 1). Water depth and environment have a large influence on the mooring system design and the dynamics of the vessel which determine riser type and configuration.
Regional comparison
FPSOs are the most common regional deepwater concept worldwide except North America where only five FPSOs have been installed (two in the deepwater US Gulf of Mexico, two in the Grand Banks, Newfoundland, and one in Mexico), representing less than 10% of total floater installations in the region
In Asia and Africa, FPSOs comprise about 90% of deepwater developments, more than two-thirds of deepwater developments in South America, and about half of deepwater developments in Europe.
