The amount of money spent on deepwater oil and gas exploration and production will double in the 5-year period 2013 to 2017 to more than US $223 Bn compared to the preceding 5-year span.

According to a new report from analyst Douglas-Westwood, the outlook for the deepwater business is one of major long-term opportunity. As deepwater projects become increasingly capital intensive there is an economic challenge for E&P companies, it said, but a significant potential prize is presented for oilfield service and equipment vendors.

Rachel Stonehouse, the report author, said: “The ‘Golden Triangle’ of Latin America, the Gulf of Mexico and West Africa will dominate deepwater expenditure over the next five years, but African developments – largely concentrated in Angola, Ghana and Nigeria – and Brazilian projects dominate the forecast spend.

“Brazil is likely to experience substantial growth, exceeding Africa’s deepwater expenditure towards the end of the forecast period, with activity driven by Petrobras’ development of its pre-salt Campos and Santos fields. Despite the delays caused by nations’ local content requirements and geopolitical disputes, significant investment will occur in the Golden Triangle, whilst some regions with historically small deepwater activity will experience astounding growth over the next five years.”

However, continuing technological advances and increased cost-efficiency will be required to ensure the viability of future prospects in both existing and new deepwater provinces, she added.