From Rotterdam (MT): Despite the depressed global offshore market, floater specialist SBM Offshore is targeting up to six potential Invitations To Tender (ITTs) that it believes could be issued between now and the end of the year.

Of these potential tenders coming out before the end of 2015, most will be for award next year, it says. However, it did stress that there remains a risk of delays or cancellations and that there is likely to be ‘significant downward adjustment expected’ during the rest of this year.

A market graph for last year revealed what was already known - the news was not particularly encouraging. Of six contracts it targeted for award during the year - out of 10 in the market overall - all were registered as ‘lost or declined’. Not good reading.

So far this year it has lost one targeted project it bid for with the market estimate for the year as a whole showing six projects up for grabs. That estimate is down by a hefty seven predicted awards from SBM’s own previous estimates. The majority of the expected 2015 awards are already at an advanced tender stage, it added.

The company’s estimate for 2016 was surprisingly upbeat with a forecast for up to 10 awards in the industry. This despite the company still having no tendering in Brazil, where it says the Petrobras situation ‘remains uncertain’.

It has already delivered two of the four fpsos it was contracted to provide there – Cidade de Paraty and Ilhabella – while the simultaneous conversion work on the ultra-deepwater Cidade de Marica and Saquarema - SBM’s largest ever contract valued at $3.5bn for the pair - will see the former delivered this year with the latter following in 2016. This pair will have 46,000t of topsides combined.

SBM’s faith in the long-term fundamentals of the deepwater market remains strong, despite the oil price having fallen 47% to $59/bbl by early February from its June 2014 level.

Saskia Kunst, MD of its Schiedam operation, admits that ‘most of the clients have been re-tendering, delaying or cancelling projects altogether, so it’s a challenging market. But there’s the enduring appeal of deepwater. We are very comfortable that in fpsos, mooring systems and FLNG, we have the right technical answers for our clients.’

This is down, she added, to the fact that the vast majority of their clients are under ‘enormous pressure’ to keep production up to make shareholders happy.

‘We still see most of our clients picking up their activities in 2016, because of the need to replenish and grow production,’ she said.

SBM has an existing order backlog of $21.8bn - including projects like the Turritella fpso for Shell’s Stones (SEN, 31/18) project in the Gulf of Mexico - with its average ‘lease-and-operate’ unit cost per barrel in 2014 coming in at an impressively low $6.90, making its production performance still economical at today’s oil price.

In a presentation on its twin-hull mid-scale floating LNG concept, the company said conversion of existing hulls would be carried out for the 1.5-2mt/a mid-scale solution with a projected topsides weight of 25,000t. For a larger option, ‘it would be a newbuild’.

SBM is targeting emerging gas areas such as east and west Africa for the concept, as well as Brazil and Southeast Asia, and says it would represent a similar capex and schedule to building and delivering a 150,000b/d fpso.

Offshore