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©2011 Quest Offshore Resources, Inc. 1
Subsea Market Review
Subsea 2011February 9 – 10, 2011
©2011 Quest Offshore Resources, Inc. 2
• Quest Offshore
• Recent activity and trends
• Forecast activity
• Contractor’s perspective
Presentation Summary
©2011 Quest Offshore Resources, Inc. 3
Data Contained Herein (Unless Otherwise Noted)Is Based on On-stream Year
Forward-Looking StatementsStatements in this presentation regarding Quest Offshore Resources or its management's intentions, beliefs or expectations,or that otherwise speak to future events, are "forward-looking statements.” Future results and developments discussed inthese statements may be affected by numerous factors and risks, such as the accuracy of the assumptions that underlie thestatements, the success of the oil and gas exploration and production industry, drilling results, uncertainties in interpretingmarket data, changes in laws and regulations, the ability to respond to challenges in international markets, includingchanges in currency exchange rates, political or economic conditions, trade and regulatory matters, general economicconditions, and other factors and risks. Actual results and developments may differ materially from those expressed orimplied in this presentation.
=COPYRIGHT NOTICE=This publication may not be distributed, reproduced, stored in a retrieval system or transmitted in any form, or by any means, electronic, mechanical, photocopier, recording or otherwise, in whole or in part, without the prior written permission of Quest
Offshore Resources Inc., Houston.Careful attention should also be paid by bona fide subscribers to their license agreement with Quest Offshore Resources
Inc., Houston, in terms of forwarding this publication. Any queries or questions in this respect can e-mailed to: [email protected].
© 2011 Quest Offshore Resources Inc.
©2011 Quest Offshore Resources, Inc. 4
To provide market expertise, strategic analysis, marketing communication and consultancy services to the deepwater oil and gas markets globally
The Mission
A dedicated team of sector specialists that focus on qualitative and quantitative data to identify global market opportunities for deepwater technologies
Worldwide deepwater basins ‐ Exploration through SURF and Marine installation segments
Capabilities
Coverage
©2011 Quest Offshore Resources, Inc. 5
Product Portfolio
• Drilling
• Subsea Production Equipment
• Umbilicals
• Risers
• Flowlines• Subsea Processing & Power
• Marine Construction Vessels
• Floating Production Systems
• Global Shipyard Capacity
• Regional Reports⁻ GoM
⁻ Brazil
⁻ Asia Pacific
• Weekly and Monthly Journals
• Conferences
• Promotion opportunities⁻ Exhibitions, wall maps, atlases
Overall Scope:• Tracking 800 exploration prospects – 150 currently active• Following over 2,500 deepwater projects – almost half are forecast projects
©2011 Quest Offshore Resources, Inc. 6
Our Clients
• Contractors– Drilling
• Down‐hole services, completions, chemicals, ROV
– Engineering• Conceptual design, FEED, detailed
engineering
• Flow assurance
• Operations and Maintenance
• Life‐of‐field extension
– Installation contractors• Pipelay & SURF, heavy lift,
– Services contractors• Diving, ROV
• Survey
– FPSO Operators
– Manufacturers• Subsea trees
• Controls
• Pumps
• Pipelines and coatings
• Umbilicals
• Cables
• Operators
• Financial services, banking and insurance
• Classification bodies
©2011 Quest Offshore Resources, Inc. 7
For Increased Utilization and Continued Technological Innovation
Long-distance Tie-backs, Compression, Boosting, Pumping, Separation
Subsea is Often Efficient, Faster & Cheaper Alternative, Improving NPV
Subsea Technology Can Unlock Reserve Potential & Max. Production
Subsea Widely Accepted Application; Has Become More ReliableMaturing
Enabler
Economics
Future
Opportunity
Why focus on subsea?
©2011 Quest Offshore Resources, Inc. 8
2004 2005 2006 2007 2008 2009 2010
Oil Price vs Expenditure on Subsea Developments
US$
US$ MM
0
20
40
60
80
100
120
140
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
Oil
Expenditure
Recent Activity
©2011 Quest Offshore Resources, Inc. 9
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
2004 2005 2006 2007 2008 2009 2010
Africa/Medit.
North America
NWECS/Arctic
Asia Pacific/Middle East
South America
Expenditure by Region
Recent Activity
US$ MM
©2011 Quest Offshore Resources, Inc. 10
0
10
20
30
40
50
60
70
80
90
0
20
40
60
80
100
120
140
160 Oil Price
Subsea Tiebacks
Standalone Developments
Oil Price vs Development Type
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Recent Activity
US$
No of Develop
men
ts
©2011 Quest Offshore Resources, Inc. 11
0
50
100
150
200
250
300
350
400
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
Non‐OECD
OECD
Source: IEA World Energy Outlook 2009
Energy Consumption (mboe/d)
©2011 Quest Offshore Resources, Inc. 12
727
182
714721
1639
0
200
400
600
800
1000
1200
1400
1600
1800
0
20
40
60
80
100
120
140
160
180
200
IOCs / Majors NOCs Independents
Operator Count
Exploration Targets
Exploration by Operator Category (2004 ~ 2013+)
Operator Activity
No of Ope
rators
No of ta
rgets
©2011 Quest Offshore Resources, Inc. 13
0
20
40
60
80
100
120
140
160
180
200
Undrilled (322)
Drilled (1164)
20 Most Active Operators
Operator Activity
No of ta
rgets
©2011 Quest Offshore Resources, Inc. 14
0
10
20
30
40
50
60
70
Africa Med Asia Pacific North America South America NWECS/Arctic
2004
2005
2006
2007
2008
2009
2010
Discoveries by Region
Operator Activity
No of Discoveries
©2011 Quest Offshore Resources, Inc. 15
0
20
40
60
80
100
120
0
2000
4000
6000
8000
10000
12000
14000
16000 Oil Price
Expenditure
2009 2010 2011 2012 2013 2014
Forecast Activity
US$ MMUS$
Forecast Oil Price vs Subsea Capex
©2011 Quest Offshore Resources, Inc. 16
Forecast Subsea Capex by Region
Forecast Activity
US$ MM
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
2011e 2012e 2013e 2014e 2015e
Africa/Medit.
South America
Asia Pacific/Middle East
North America
NWECS/Arctic
©2011 Quest Offshore Resources, Inc. 17
Forecast projects by tree count
Forecast Activity
0
5
10
15
20
25
30
35
40
45
1‐2 Trees 3‐5 Trees 6‐10 Trees
11‐25 Trees
26+ Trees
2011
2012
2013
2014
0
10
20
30
40
50
60
70
80
90
100
2011 2012 2013 2014
26+ Trees
11‐25 Trees
6‐10 Trees
3‐5 Trees
1‐2 Trees
No of Projects
No of Projects
©2011 Quest Offshore Resources, Inc. 18
0 2 4 6 8 10 12
NWECS/Arctic
Africa & Mediterranean
North America
South America
Asia Pacific & Middle East
Subsea Tieback Stand‐alone ProjectYears
Forecast Activity
Average Number of Years Between Discovery and Sanction
©2011 Quest Offshore Resources, Inc. 19
• Pipelay– Method
• Line‐pipe or reeled
– Max. Pipe diameter
– Water depth
– Location of assets and support
• Geotechnical investigations– Sampling
– Drilling
– Water depth
– Location of assets and support
Contractors’ Perspective
Capabilities and limitations
• Survey– Sensors
– Towed, autonomous, ROV‐deployed
– Combined with geotechnical
– Water depth
– Location of assets and support
• Diving– Mechanical tie‐ins
– IRM
– Water depth
– Location of assets and support
©2011 Quest Offshore Resources, Inc. 20
Contractors’ Perspective
At which stage of the development can I participate?
Prospect Discovery Appraisal Conceptual FEED
Construction Flowing Suspended Decommissioned
Appraise / Define
Concept Select FEED Execute &
Construct Operate COP
Typical Operators’ Field Development Process
Quest Project Status
©2011 Quest Offshore Resources, Inc. 21
• Filter data
• Search Criteria• Water depth
• Geographic Location
Contractors’ Perspective
Prospects, Discoveries and Appraisals
OpportunitiesRig site surveys
Geotechnical investigationDrilling servicesRig positioningROV support
Engineering (Conceptual)
Look‐aheadEngineering (FEED)
0
20
40
60
80
100
NWE/A
Af/Med
NAM
SAM
AsiaPac
1501m +
151 ‐ 1500m
<150m
No of Prospects • Long look‐ahead
• 1/3rd of prospects expected to be developed after 2016
©2011 Quest Offshore Resources, Inc. 22
• Filter data
• Search Criteria• Water depth
• Geographic Location
Contractors’ Perspective
Concept, FEEDOpportunities
Engineering (FEED)SurveyGeotechSPUFPSO
Construction
Look‐aheadDiver tie‐ins
SurveyPre‐commissioning
0
10
20
30
40
50
NWE/A
Af/Med
NAM
SAM
AsiaPac
1501m +
151 ‐ 1500m
<150m
No of Prospects
• Time‐line shortening as projects firm up
• Less than 10% will be developed after 2016
©2011 Quest Offshore Resources, Inc. 23
• Filter data
• Search Criteria• Water depth
• Geographic Location
Contractors’ Perspective
Pending / ConstructionOpportunitiesInstallation
FPSOConstruction Support
Diver tie‐insSurvey
Pre‐commissioning
0
10
20
30
40
NWE/A
Af/Med
NAM
SAM
AsiaPac
1501m +
151 ‐ 1500m
<150m
No of Prospects
• These projects almost certain to go ahead
• Only one is scheduled for post 2016
©2011 Quest Offshore Resources, Inc. 24
Contractors’ Perspective
Other indicators
• Subsea trees– Leading industry indicator
– Long‐lead item
– Size of the development
• Same can apply to:– FPSOs
– Pipe
– Umbilicals
– Other SPU components
©2011 Quest Offshore Resources, Inc. 25
Contractors’ Perspective
All prospects
• Filter data
• Search Criteria• No of Projects
• No of Subsea Trees
• Type & no of Tiebacks
OpportunitiesSurvey & Positioning
SPSSubsea installationTrees‐on‐wire
ROV interventionDiver tie‐ins
Diverless tie‐ins
0
200
400
600
800
1000
1200
1400
1600
1800
2000
0
20
40
60
80
100
120
140
160
180
NWECS/Arc. NAM AsiaPacME SAM Afr/Med
No of Projects
FPSO Tieback
P/F or Manifold Tieback
# SS Trees Ave Trees / Project
NWECS/Arc. ≈ 4 Africa/Med ≈ 12 NAM ≈ 5 SAM ≈ 25 AsiaPacME ≈ 7
©2011 Quest Offshore Resources, Inc. 26
• Filter data
• Search Criteria• Operating fields
• Water depth and geographic location
• Pipeline length, no of SS trees and FPSOs
Contractors’ Perspective
Operating Developments
OpportunitiesIRM
Well maintenance
0
500
1,000
1,500
2,000
44 6049 57 99
Number of SS Trees & FPSOs
SS Trees FPSOs
0
200
400
600
800
1000
1200
1400
SS Developments
AsiaPacME
SAM
NAM
AfricaMed
NWECS/Arc.
0
10,000
20,000
30,000
40,000
50,000
60,000
Pipeline (km)
©2011 Quest Offshore Resources, Inc. 27
• Target– Short, small diameter subsea tiebacks
• Search Criteria– Water depth (120m), Reeled pipe (max 8” od, 20km length)
• Outputs– 9 prospects in Australia, Cambodia, China, Indonesia and Vietnam
– Installation dates range from 2012 to 2016
– 3 tie‐backs to platforms
– 6 tie‐backs to FPSOs including one new build
– Prospective clients: • Apache, Chevron, CNOOC, Husky Oil, Premier Oil (2), PTTEP, Santos (2) and Woodside
Petroleum
• Widen the search– 250m wd
• Two more prospects in Australia
Contractors’ Perspective
Market Study – Light installation / diving contactor, Asia‐Pacific region
©2011 Quest Offshore Resources, Inc. 28
• Target– Subsea inspection
• Criteria– Operating fields, subsea production
• Outputs– Operators of subsea fields
• 7 (Addax, Afren, Chevron, Eni, ExxonMobil, Shell, Total)– Water Depth Range
• Operating fields ‐1460m (Chevron, Agbami)• Prospects – 2,479 (Shell, Bobo)
– Pipelines• Export lines – 1,980km (including 6 landfalls)• Infield Lines – 361km
– Subsea Equipment• Subsea Trees – 174
• Manifolds – 30⁻ Floating Production & Storage
• Offshore/deepwater – 9• Inshore/terminals ‐ 9
Contractors’ Perspective
Market Study – ROV / ROVSV contractor, Nigeria
Shell, BongaWater Depth ‐ 1200m
Export lines – 94km
Infield Lines – 71km
Umbilicals ‐71km
Subsea Trees – 46
Manifolds – 5
FPSO – 1
Risers ‐ 15
©2011 Quest Offshore Resources, Inc. 29
Contractors’ Perspective
Demand for light construction vessels • Vessels for umbilical, module, spool and jumper installation
• Potential short‐fall based on current fleet size
• Expected to be made up by new‐builds being delivered to global fleet
©2011 Quest Offshore Resources, Inc. 30
Supply & Demand
Demand for heavy construction vessels • Vessels for flow‐line, export line and riser installation
• Potential short‐fall based on current fleet size
• Expected to be made up by new‐builds being delivered to global fleet
©2011 Quest Offshore Resources, Inc. 31
•2009-2016e Awards = Mean Case
45%
25%
63%
Contractors’ Perspective
Demand for subsea trees• Mean case indicates production capacity will be fully utilised by 2014
• High case indicates that production capacity will be exceeded
• Possible scenario: Supply of subsea trees cannot meet future demand
©2011 Quest Offshore Resources, Inc. 32
• Segment– Geographic location, water depth, etc
– Scope of work ‐ Survey, construction support, IRM etc.
– Capabilities and limitations – e.g. water depth limits
• Identify prospects– Client
– Size and value
– Schedule
– Specific location
– Forecast, Prioritise and Target
• Become informed and able to approach customer with a solution for his requirements
• Analyse capacity to meet future demand
Summary
Market Assessment
©2011 Quest Offshore Resources, Inc. 33
In partnership with
Thank YouBill Donaldson
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