The amount of Capital Expenditure (Capex) on floating production systems will accelerate over the next five years, growing by a forecast 18% between now and 2017, according to a new report.

The CAGR (Compound Annual Growth Rate) of 18% compares to a figure of 10% for the prior five-year period, says Infield Systems in its latest floating production systems market report. Although not revealing any specific expenditure figures, the percentages themselves are impressive – floating production installations in 2017 are expected to be 95% higher than in 2008, for example.

The growth in both Capex and installations is largely driven by the increase in the number of developments to monetize gas in remote locations, it said, as well as the increasing focus on optimizing production from ultra-deepwater developments. Africa, Latin America and Australasia are expected to account for the most significant levels of growth in terms of Capex relating to FPS developments.

According to Infield, when looking at FPS developments by water depth, the increasing dominance of deep and ultra-deepwater Capex over the forecast period continues. Shallow water Capex is likely to peak in 2016, whereas ultra-deep Capex is expected to remain on an upward trajectory to 2017. Ultra-deep Capex overtook the deepwater market in 2010 and is not set to be eclipsed by it at any point during the forecast, it added.

However, despite shallow water Capex starting to decline after 2016, it is still expected to represent the largest share of the FPS market. This is thanks largely to Asia and Australasia, where the waters are generally shallower, and also where the projects are often in remote locations from shore.

The ultra-deepwater market is, of course, driven by Latin America and North America, whilst the deepwater market is driven by Africa and Latin America.

The deep and ultra-deep oil-focused developments in Africa and Latin America, combined with the gas-focused developments off Australasia are expected to account for almost 59% of total FPS Capex over the period. Towards the end of the forecast, Infield expects to see an increasing number of developments in areas where there has been no prior FPS activity, such as East Africa and the Falklands. “Capex growth from such areas is likely to accelerate towards the end of the forecast and, despite initially only accounting for a small share, such areas are likely to become increasingly important after 2017,” it said.

In North America, it is the ultra-deep GoM that commands the lion’s share of Capex, accounting for 69% of total North American FPS Capex. In the Middle East & Caspian Sea region, Capex is split between very shallow developments in Kazakhstan and the Persian Gulf, and developments in Israel’s ultra-deep Eastern Mediterranean waters.

Australasian Capex is almost entirely dominated by Australia itself, with relatively minor Capex outside of this country. In Europe the major producers of Norway and the UK are set to command 80% of Capex. Countries outside the two major producers in Europe, such as Ireland and Romania, are expected to account for a larger share of Capex towards the end of the forecast.

Unsurprisingly the FPS market in Latin America remains dominated by Petrobras’ huge expenditure plans in Brazil, while Africa sees Capex directed primarily towards West Africa – of which 71% is likely to be focused on FPS developments in the established offshore powerhouses of Angola and Nigeria.

Asia has no overall dominant country with regards to FPS developments, but Malaysia and Indonesia account for the largest market share of Capex, with 79% of the Capex for the entire region directed to countries in SE Asia.

Infield’s FPS report includes detailed sector breakdowns by specific unit type including FPSOs, FSOs, TLPs, Spars and Semisubmersibles, as well as detailed commentary and analysis about historic and forecast Capex , and the number of installations. There are also breakdowns by type, water depth and build. More info is available at: www.infield.com