Report: ROV Demand to Grow as Projects Get Green Light
The results from the latest analysis by Westwood Global Energy shows that the market is starting to emerge from a cyclical downturn that has seen activity fall 36% and expenditure nearly halved.
The work-class ROV (WROV) market is driven by drill-support, field construction and IRM activities offshore.
Intense competition amid lower activity levels has depressed pricing, however, 2016 appears to have marked the bottom of the market and some recovery is now evident. Renewed project-sanctioning activity such as Cheviot in the UK and Mad Dog Phase 2 in the USA points to a more positive future for WROV demand. Coupled with the large global installed base of infrastructure which will ensure that WROV’s for IMR activity remain essential, the ROV market is now expected to see a positive growth trajectory.
According to the World ROV Operations Market Forecast 2018-2022, ROV expenditure will total over $10bn with a 4% CAGR expected as operators begin to sanction more projects.
In total there will be demand of 1,030,659 days for WROV’s, averaging over 200,000 a year and growing at a 1% CAGR.
Regionally, Asia will account for the largest proportion of activity, representing 19% of days required, followed by Latin America and the Middle East which will both account for 18%.
WROV support for drilling activities will represent 61% of days required, driven by development wells. Construction Support (22%) and IMR (17%) account for the rest of WROV support.
ROV Activity will not return to the levels seen in 2013-2014 when project sanctioning for large-scale projects was at its peak but has stabilised and will grow over the forecast, DW noted.