The rig-building boom has seen a flood of new units arrive on the market. But the evidence is that this is the very minimum required to meet the world's unending thirst for fuel.
Although this boom is big, it is not the biggest there has ever been. However, according to Tom Kellock of IHS-Petrodata, the current one is not over yet.
Listening to Kellock at the IADC's World Drilling conference in Barcelona, Spain, it was clear that although this boom is not the biggest in terms of the number of units built and being built, it is certainly the biggest in terms of dollar value. "It's a lot more than in the '70s boom," Kellock told delegates.
He continued, "We are adding to the fleet, with the new rigs fulfilling the additional demand. But even with no more orders we have only seen around half of the deliveries so far. I believe there are more orders to come, both for floaters and jackups – it ain't over yet!"
Demand for modern floaters is expected to exceed supply for several years despite a long queue of newbuild drillships and semisubs like Seadrill’s West Pegasus, delivered last year. (Image courtesy of Seadrill)
He also went on to highlight that for both jackups and floaters (semisubmersibles and drillships), deliveries are being achieved on time, especially as the yards (mostly in Asia) are building almost entirely from established rig designs. For drillships, for example, one has to go back to 2005 for the last instance of a drillship not being finished on time.
As far as floating rigs are concerned, ultra-deep water is definitely the dominant specification. Kellock also highlighted the fact that despite water depths of 3,048 m (10,000 ft) or more being the bespoke capacity for most, the fact is that the average water depth for rigs working today is 1,067 m (3,500 ft). "So we do not need ultra-deepwater rigs all the time," he observed.
However, the long-term picture remains one of an offshore industry going deeper, with deep and ultra-deep water a key weapon in the battle to meet growing oil and gas demand alongside unconventional onshore resources.
This means that more rigs capable of drilling in these depths must be built – a recent presentation by Sevan Drilling highlighted that development drilling requirements alone will make up half the demand for deepwater rigs. When one bears in mind that most deepwater discoveries that have been made so far have not yet been developed, one gets an idea of what the future demands will be, with the stage very much set for growth. Here are some indicators:
142 Bboe of deepwater resources have been found and developed around the world;
- Only 50% have been produced;
- A total of 174 Bboe have been found but not yet developed;
- Deepwater development backlog amounts to 55% of the volume discovered so far;
- Another 591 Bboe of resources are expected to be discovered; and
- This is 90% higher than those already discovered.
What that means, based purely on resource numbers, is that less than 15% of the global deepwater drilling effort required to find, appraise, and produce the above resources (both past and future) has so far taken place.
That means that this latest rig-building boom has a long way yet to run…
