Τhe FPSO market is booming this year, with more contracts awarded in the second quarter of 2021 than during the full year 2020.
Namely, Rystad Energy expects FPSO awards to reach a total of 10 units in 2021, with another 10 following next year, creating a very healthy project line-up for contractors, effectively doubling their pipeline.
Four FPSOs were awarded in the second quarter and we believe another four will be awarded before the end of the year. Including the two awards from the first quarter, this will bring the total tally up to 10 FPSO contract awards in 2021 – more than triple the three awards from 2020 – signaling a rapid comeback in FPSO contracting activity, despite the Covid-19 pandemic.
…Rystad Energy said.
The four FPSO contracts expected to be awarded before the end of the year include the Mero 4 and Parque das Baleias in Brazil, Limbayong in Malaysia, Liuhua 11-1 in China.
“It’s not that contractors were out of business, there are currently over twenty FPSOs under construction, one of which is likely to start-up already this year. But after a weak 2020, the recent awards and the expected ones are doubling the pipeline, ensuring manufacturers will keep busy in the years ahead,”.. says Aleksander Erstad, energy service research analyst at Rystad Energy.
Petrobras is currently evaluating bids for the two Brazilian FPSOs, Mero 4 and Parque das Baleias. The Brazilian giant only received bids from one supplier for each of the FPSOs. For the larger unit, Mero 4, SBM Offshore was the sole bidder, while Yinson was the only player to bid for the smaller Parque das Baleias FPSO. The muted interest comes as the FPSO supply chain is nearing full capacity with several supplier unable to take on new projects.
In Malaysia, Petronas is evaluating bids for the Limbayong FPSO with a contract award expected to be handed out before the end of the year. Contractors involved in the bidding process are Yinson, MISC, Sabah International Petroleum, and a consortium comprising Bumi Armada, MTC and Shapoorji Pallonji.
China’s CNOOC is looking for a cylindrical FPSO to redevelop the Liuhua 11-1 and Liuhua 1-4 fields in the South China Sea. The FPSO will be built in China and is likely to involve COOEC, Cosco and CIMC Raffles.
Another 10 projects are likely to be awarded in 2022, with the year expected to match 2021 in terms of FPSO awards. Most of the FPSO awards come from Latin America with four units bound for Brazil and one for Guyana. Angola and the UK are likely to see two awards each, and one is lined up for Australia.
