Westwood’s latest World Oilfield Equipment Market Forecast anticipates $148 billion of total global spending, including capex on the engineering, procurement, construction, and installation of fixed platforms and floating production systems (FPS) by 2022.
The report also sees further improvements in offshore E&P activity between now and 2022.
In North America’s offshore market, the recent improvements in oil prices have boosted investor confidence, with total expenditure of $28 billion anticipated over the forecast period, according to the report.
Of the $28bn North America spend, the report noted that $18 billion will likely come from FLNG developments, with eight LNG FPSOs set to be ordered by the end of 2020.
But for offshore rig construction, the outlook for expenditure remains weak due to the exceptionally take-up levels for the current fleet as a result of the previous build cycle.
Only four orders have been placed since the start of 2015 – two in the last six months (one jackup and one semisubmersible rig) – and with a relatively flat outlook for offshore drilling this year, the outlook does not foresee any material increase in MODU use, except in a few markets.
And only eight orders are set to be placed between 2018-2022, which will not offset the declining backlog for rig builders, the report says.