Growth in Teekay Offshore’s core offshore markets
The offshore oil production and transportation industry is in growth mode, particularly in Teekay Offshore’s core markets of Brazil and the North Sea. In Brazil the growth opportunities are a result of the high level of new offshore exploration and production (E&P) activity that is taking place. In the North Sea it is the both the development of new fields and the redevelopment of existing fields which is driving growth.
At present there are approximately 160 floating production, storage and offloading (FPSO) project studies ongoing worldwide, almost half of which are in Brazil and the North Sea. Two years ago, the number of visible FPSO projects was only half this total. Demand for shuttle tanker solutions is expected to rise in tandem with the growth in deepwater oil production.
Brazil
Brazil is the world’s fastest growing offshore oil frontier with 28 FPSOs in service and a further 41 projects currently in the tendering or planning phase. Since the start of 2010 contracts have been awarded for 11 FPSOs including eight newbuildings for the giant Tupi field alone.
Offshore Brazil has produced some of the largest oil discoveries of the last decade and new fields continue to be found, particularly in the sub-salt region of the Santos Basin. In early 2010 Petrobras, Brazil’s state-controlled oil company, announced the discovery of the 4.5 billion barrel Franco field, the world’s largest oil discovery since the Tupi field in 2007 (which is also located offshore Brazil).
Further discoveries are expected from new exploration and production work with Petrobras recently announcing a commitment of USD 118 billion to E&P activities as part of its 2010-14 investment plan. This figure represents a 14 percent increase in E&P spending over the company’s previous five year plan.
The North Sea
While the North Sea is considered a mature region for oil production it remains an active FPSO market due to its harsh weather and proliferation of smaller, more marginal oil fields that are typically developed by independent field operators who prefer leased FPSO solutions.
At present there are 22 FPSOs in operation in the North Sea with a further 28 planned or possible FPSO projects, up from only 15 projects one year ago.
Teekay Offshore is well-positioned
Teekay Offshore has the operational expertise and experience required to operate in harsh weather and deepwater environments. As a provider of complete offshore solutions – production, storage and transport - with market leadership and an expanding presence in the North Sea and Brazil, respectively, TOO is well-positioned to grow in these opportunity-rich markets.