FPSO market still faces challenges
But digital tools helping reduce operating costs
Christopher M. Barton
As the world’s production, market prices and variable demand have remained in flux, so too has the activity for floating production, storage and offloading (FPSO) vessels. But, due to several inherent advantages, this vessel type has more options to see active service than other floating production
system types. These advantages include operating flexibility, range
of water depth, conversion possibilities, and storage capacity range.
In comparing year-to-year vessel counts, Of fshore’s 2017 Worldwide
Survey of Floating Production, Storage and Offloading units poster
has shown a growth from 169 active vessels in 2016 to 178 FPSOs
either in operation as of July 1, or slated to reach first production by
the end of 2017. The survey results have also shown an increase in
worldwide vessels available awaiting redeployment, currently numbering 19 FPSOs. That count has continued to rise, even in the short
period from Of fshore’s Deepwater Solutions & Records for Concept
Selection poster (May 2017), which included FPSOs and recorded
17 non-operating but deployable vessels.
The mix of the FPSO vessels in service has not changed appreciably. In 2016, the percentage of active vessels owned by a contractor
company for lease to a producer was 52%. The remainder were owned
by production companies for their own use. In 2017, that percentage
of FPSO contractor-owned vessels for lease was approximately 51%.
The percent of active FPSOs converted from vessels formerly serv-
ing as very large crude carriers (VLCC) has remained relatively
constant year-to-year when compared to newly built vessels entering
into service, 71% in 2017 vs. 70% in 2016.
According to statistics provided by World Energy Reports, 12 FPSOs have been sanctioned and are at some stage of construction for
delivery in 2018 or beyond. Their statistics reveal that the majority
of these planned vessels, 55%, are destined for water depths greater
than 1,000 m. The balance are intended for water depths less than
1,000 m, but these still total approximately 45% of planned vessels,
demonstrating the FPSO water depth versatility.
Vessel design commonalities can be cost effective and have
prompted the industry to standardize on vessel storage capability
and throughput, wherever possible. For example, two FPSOs destined for deployment offshore Angola in 2018 are currently being
converted by Saipem for use in identical water depths and storage
capability. Similarly, Petrobras is still proceeding with construction
of vessels from a standard conversion template; these vessels will
operate offshore Brazil with installations from 2017 to 2019. Petrobras’
most recent tender for VLCC conversion, if approved, will add a fifth
vessel to the Buzios complex, joining four others on order, each with
180,000 b/d production capability.
Oil and gas price fluctuations are not only difficult to project, but
they often require short-term decisions for increasing or curtailing
production. FPSOs generally offer a cost-effective solution, especially
for marginal fields and changing price conditions. As noted, FPSOs
can be converted from previously used storage vessels tankers. It is
estimated that single-hull conversions can be accomplished at a cost
of 10% of newbuilds and, depending on the extent of the required
conversion, can be available for service within a two-year timeframe
– normally 20% less time than for construction of a newbuild FPSO.
Reservoir economics have contributed to a growth in the number
of vessels taken from ser vice and listed as “available” by their owners,
awaiting contracts to resume production. Because of their mobility,
leased FPSOs are normally the fastest and least expensive means of