Archives for posts with tag: ROV

The rigid pipe layer fleet is complex, varied and sometimes perplexing: S-lay, J-lay, reel-lay; barge, vessel, semi-sub; tensioners, carousels, moonpools – units therein defy easy comparison with one another. And so, unlike in many sectors of the offshore fleet, it is not immediately clear what is a ‘high-spec’ and what a ‘low-spec’ unit. What is needed, then, is a framework to analyse the 172-strong pipe layer fleet…

Offshore Operations

In essence, pipe layers are used to install rigid pipelines on the seabed, primarily during the development of offshore fields. These pipelines are used to export oil/gas to shore, or to transport fluids between seabed or surface installations within a project area. Pipe laying is conducted during the EPC phase of project development, consequent on award of (typically lump-sum) EPIC and SURF contracts, usually to specialist offshore construction companies like Allseas, McDermott, Saipem, Subsea7 or Technip, who own 4, 5, 14, 6 and 6 pipe layers respectively – 20% of the fleet. There is no pipe layer spot market as such, so comparing day rates to pick out the high-spec from low-spec units is not possible.

Inscrutable Idiosyncrasy?

Vessels’ traits are not immediately helpful either. Monohull structures account for 19% of units and barge/semi-sub structures for 81%. Pipe sections are welded on-board and deployed via J-Lay towers (8% of units) or S-Lay stingers (76%), the letter indicating the curvature of the pipeline as it is lowered to the sea floor. However, 3% of vessels have both J-Lay and S-Lay structures; 16% use cranes or have hybrid, reel-lay systems; and the tensioner capacities of lay systems (i.e. the weight of pipeline they can support) range from under 10mT up to 2,000mT. There is no simple correlation between a single feature and a unit’s capabilities: “Lorelay” has tensioners of 265mT, yet cannot lay pipes in ultra-deepwaters; “C Master”, with tensioners of 160mT, can. The secondary functions of units can also vary greatly: 10% of units have ROV capabilities, for example. Moreover, 19% of units in the flexi-lay fleet can install rigid pipelines (and 5% vice versa). How then, amidst this variation, to distinguish a ‘high-spec’ from a ‘low-spec’ pipe layer?

A Promising Perspective

One way is to cross reference the maximum pipe lay water depth of units with the maximum diameter of pipe they can lay. Thus the 12 units in the “red” segment of the inset chart (e.g. “Seven Borealis” and “Sapura 3000”) could be considered high-spec and versatile, competing with units in the “dark blue” segment for ultra-deepwater subsea contracts, but with the “light blue” segment for large export pipelines in shallower waters. In the opposite quarter of the matrix, the 55 “grey” units are mostly barges, deployed in shallow waters like the Niger Delta and Lake Maracaibo. One could say there are four (overlapping) markets for pipe layer work. The range of EPC contracts for which construction companies are likely to bid will depend in part on the segmentation of their pipe layer fleets.

So, pipe layers have an array of characteristics complicating segmentation. However, some units are clearly better suited to some projects than others. By cross-referencing factors like water depth with pipe width, one can craft a framework for sorting through this diverse fleet.

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SIW1098In 1961, the world’s first subsea completion was installed on a well in the Gulf of Mexico. Over the last 52 years the use of subsea trees has spread to the majority of offshore producing regions, with a total 4,851 trees installed by end-2012. Since 1990, the world has seen a growth in the number of deep water (>500m) tree installations. The use of subsea trees and developments appears set to revolutionise the offshore oil and gas industry, placing more focus on subsea fabricators.

Into the Deep End

The Graph of the Month shows the number of subsea trees installed per year from 1990 to 2016 (potential/under construction post-2013) and a breakdown of shallow versus deepwater installations. During 2011, the subsea tree demand hit a low point in the wake of 2008’s economic troubles. Since then however, the sector has seen a boom in tree installations, with expected future installations for 2014 up by 77% on 2013 and 2016 projected installations up a staggering 174% on 2013, with a total of 916 potential trees. Furthermore, the near future will demand more subsea trees with deep water, high pressure technologies, as shown by the increase in the share of trees in deep water of around 40 percentage points since 2000.

Subsea Honeypots

The region utilising the most subsea trees is NW Europe, with 1,638 active. The region’s ageing fields, containing smaller, marginal pay zones, mean that subsea trees and tie-backs provide a solution for continuing productivity in the North Sea. In Latin America, subsea trees are allowing for the development of wells in the ultra-deep water pre-salt plays of Brazil. The region has 919 active trees and accounts, along with West Africa, for many of the potential installations over 2013-2016. Subsea is not for everyone however: in the shallow Middle East, less than 40 trees are active, with wellhead platforms preferred.

Ready Yourselves

Given the extra subsea tree demand, how will the market cope? As previously highlighted, demand will have a bias, with many being required in the North Sea and Brazilian pre-salt areas. GE Oil & Gas have reportedly stepped up their UK manufacturing capacity for trees by circa 40%. However, with only 4 major subsea tree fabricators worldwide, supply may bottleneck in the coming years.

A boom in subsea tree demand will also affect the installation vessel markets. Traditionally, MODUs and other drilling vessels were used for tree installation. However, with the hike in rig costs (45% since end-2010 for jack-ups), installation contractors have been increasingly turning to installation by relatively cheaper MSVs. A total of 68 MSV vessels are on order, which despite accounting for 25% of the current fleet, may grow. There is also an additional 10% of the Dive and ROV Support fleet on order, a number which is likely to increase over the next 4 years.

So, Petrobras, Statoil and the supermajors are employing subsea technology increasingly frequently. Demand is growing for trees and associated infrastructure, along with installation units, promising a positive period for subsea fabricators.