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MARKETS OSVs © STOCKSTUDIO / Adobe Stock 5% in Asia Pacifc and 4% in the Middle East. Taking for example the Salam-Patawali project off Malay-

Meanwhile, major offshore engineering contractors are sia, ConocoPhillips have pulled the plug resulting in a delay also steadily building their backlogs. These backlog fgures in the project progress. With a greenfeld commitment ex- demonstrate the expected elevated levels of offshore up- pected at $1.7 billion, it is unlikely that Petronas will be able stream activity anticipated in the medium term, particu- to move ahead with the project alone. Similarly in Thailand, larly as energy companies ramp up capital investment in PTTEP has suspended its Lang Lebah project and delay- oil and gas projects, in regions like the Middle East and ing it till next year. While no exact reason has been stated,

Latin America. As of 2025 to date, Tier 1 EPC contractors it is believed that the political dynamics in Sarawak have report a combined backlog of $49.5 billion – the highest contributed to market unease for operators working therein.

level seen in the past fve years. That said, the OSV market in Southeast Asia remains

Although some project decisions have been delayed due resilient, bolstered by encouraging forecasts for operational to oil price volatility and shifting economic feasibilities, con- rigs and the current state of supply vessels. Based on a work- tractors remain optimistic about long-term demand. Off- ing feet of 37 rigs – and assuming each deploys two AHTS shore projects remain a preferred investment avenue for op- and one PSV – this translates to demand for approximately erators, with deepwater projects attracting a growing share 74 AHTS and 37 PSVs. At frst glance, the region’s 200 of global capital, buoyed by improved project economics AHTS (which only accounts for the 60 to 80-ton class, the over the years. However, this could evolve as the industry typical workhorses) and 90 PSV feet appear adequately suf- navigates the shifting sands of geopolitics, which continue fcient and healthy. However, a deeper look at vessel age and to cast uncertainty over oil prices and investment timelines. operational readiness suggests otherwise. The average age of the feet today is 16.5 years, and excluding vessels above 25 years, 17% of the current feet is due for retirement by

Promising Medium-Term Outlook for

Southeast Asia OSV Market 2030. Moreover, both AHTS and PSV are routinely de-

In the Southeast Asia OSV market, the tides have turned ployed for a broader range of offshore operations beyond since last year, following the wider global macro trends. Just rig support – including FPU support, towage, and standby a year ago, vessel availability was limited and considered a duties – all of which contribute to intermittent demand prized asset in a bustling market. Today, a signifcant pool of that places additional pressure on an ageing feet.

vessels has empty windows between jobs, seeking employ- Looking ahead to 2026, and excluding vessels above the ment in a slower-moving market. Dark clouds hover as proj- age of 25, we count a total of ~190 AHTS and ~75 PSV. ects face delays and softer market sentiment weighs on near- With minimal newbuilds in the pipeline and deliveries ex- term demand. However, these dark times will pass soon, as pected mostly from late 2026, the rate of asset replenishment committed vessel budgets and planned project expenditures will lag behind retirements – tightening the market further.

point to a more promising medium-term outlook, with in- And this trend is already visible in today’s market. Dur- creased rig activity combined with a tightening vessel sup- ing peak activity, newer tonnages are snapped up quickly, ply. Moreover, deferred project timelines pave the way for an leaving older units to compete for fewer jobs. Interest in uptick in activities in the latter half of the decade. newbuilds remains tepid in this region, as traditional own- may/june 2025 OFFSHORE ENGINEER 9