Four regions remain activity leaders through 2005

1997 not such a boom year, considering what the future holds

Marshall DeLuca
Business Editor

Leonard Le Blanc
Editor

Development activity in areas such as the Gulf of Mexico is expected to increase through the year 2005, by virtue of developments like Oryx's Neptune Spar platform, shown above. Other areas showing great promise are Northwest Europe, Southeast Asia, and West Africa. The ease of building and installing spars, mini-TLPs, and floating production vessels for large deepwater reserves is revitalizing offshore development, resulting in larger investments, beginning in 1998.

The four most active offshore oil and gas development regions in the world - Northwest Europe, West Africa, Southeast Asia, and North America - will probably remain that way through the year 2005. According to statistical data generated by Infield Systems in London, the four regions show a relatively large number of planned oil and gas development projects with very little decrease over the coming years.

Infield has generated data on current, planned, and considered field developments, platforms, subsea wells, and pipelines around the globe from 1997 through 2005. The data gatherer considers this a "snapshot" of the industry rather than a forecast.

Economic fundamentals (prices, supply), the political climate (events, regulations, and environmental) and events within the industry (discoveries, technological advances) can alter development planning, but the projections are likely to hold if the drivers do not change significantly.

1997 not so hot

Contrary to the alleged industry "boom" currently underway, 1997 will be remarkable in that the fewer field developments will come onstream this year than in any of the next six years following, according to Infield Systems data. This suggests that industry equipment demand will definitely increase without letup for most of the next decade.

Producing companies in most geographic regions plan to place the largest number of oil and gas developments onstream between the years 2000 and 2001. North America is the only geographic region with a peak onstream rate in 1997.

Northwest Europe plans 75 field developments in 1998, the world's largest total. Only 38 fields are expected to be onstream in 1997, a number that the region will maintain through 2003.

West Africa plans a region high 41 fields to be developed in 2002. The number planned steadily increases each year with only slight decreases between 2003 and 2005. Southeast Asia is planning its high development year for 1999 with 37 fields, and a region average of approximately 29 fields developed per year. The region plans the least development in 2004, with 21 fields.

North America however, considered by some as the hottest region in the world, shows a steady decline in field development. It does lead the worldwide with total number of producing fields (1,431) which is more than half of the total developed fields in the world. After 1997, however, the numbers of planned fields decreases by more than 10 per year.

Worldwide, 1,655 fields are expected to come onstream by 2005 (a total of 4,139 developed fields, historically), at an average of 184 fields added each year.

Platforms planned

By year-end 2005, 8,836 offshore platforms will have been installed if everything goes to plan, according to Infield Systems data. A total of 1,452 platforms are likely to be installed between 1997 and 2005, with 7,384 such structures installed to date around the globe. An average of about 161 platforms are expected to be installed each year between the years 1997 and 2005.

The main four producing areas of the globe are planning the highest number of platform installations, averaging a total of 29 installations per year between them. Southeast Asia plans for the most installations, with an average of 42 per year, and the world high in 1999 with 83 planned installations, and second highest in 1998 with 77.

North America and West Africa each plan for the third most installations in a single year with 60 followed by Northwest Europe with 51.

Northwest Europe will average 27 fields per year and holds the second place spot, followed by West Africa with 20 fields.

North America still leads the world with the most platforms already installed (3,194), but after 1997, installations show a sharp decline.

The vast majority of the planned installations around the globe will take place between 1997 and 1999. This is probably due to the expected high cost associated with the construction of future platforms and floating production systems coupled with the inability to procure contracts that far in advance. Another factor is the evolution of future technology and the use of subsea systems.

Subsea installations

Northwest Europe plans to utilize the most subsea technology in developing its wells. A total of 240 subsea wells are planned for 1998 in the region, with 1,151 wells planned from 1997 to 2005, according to Infield (see related subsea article on page 58 for other data and views on future subsea installations).

Northwest Europe also holds the highest number of subsea wells in operation (432), almost 200 more than the second most region, Latin America. Northwest Europe plans to more than double its use of subsea wells by adding 1,151 through 2005.

Latin America follows in second, with 247 subsea wells in use, and 616 planned for installation in the next nine years, more than double its current use. Latin America will also average 68 subsea wells per year over the charted period, with a high 116 wells in 2001.

Following Northwest Europe and Latin America, the other regions using the most subsea wells are North America, Southeast Asia, and West Africa. The most subsea wells worldwide will be installed in 1998, 2001 and 2001. By 2005, 3,415 subsea wells are planned to be installed; 2,469 between 1997 and 2005 (an average of 274 wells per year).

This trend illustrates the shift toward subsea completions for the future of the industry, most likely a result of the expansion in deepwater and the use of subsea as tie-backs to platforms and floating production.

Pipeline plans

If all plans come to fruition, by the year 2005 a total of 168,568,107 meters of trunk and field pipelines will have been installed. A total of 73,500,535 meters are planned for 1997 through the year 2005, an average of 8,166,726 meters per year worldwide.

Northwest Europe is planning the largest total distance of pipeline length to be laid followed by North America. Each plan over 2,300,000 meters for 1997. Europe plans to lay the most pipeline in 1998, with 4,337,010 meters, almost 2,000,000 meters more than any other region in a given year.

North America to date has laid the most pipeline, with more than 31,000,000 meters, followed by Northwest Europe, with 21,693,447, Southeast Asia with 10,285,144 meters, followed by Latin America.

The numbers reflect that these regions plan to lay the most pipeline in the coming years with respect to the rest of the world.

That Northwest Europe, Southeast Asia, West Africa, and North America lead in most each one of these charts is no surprise. It is reassuring to see that the numbers will continue to hold strong for regions that are maturing or mature.