Page 12: of Marine Technology Magazine (November 2015)

Offshore Market Report duction ? oater orders. Ultimately an in- vestment decision is needed to transform these deepwater project opportunities into contracts for ? oating production facilities.

In our forecast report we examine eleven underlying business drivers that will in- ? uence the timing and direction of future deepwater project investment decisions.

Here’s how we see these eleven drivers at the moment.

In the positive category are • Oil and gas demand keeps growing.

• Supply disruption potential keeps fo- cus on ? nding new sources of supply.

• Long term oil/gas prices will rise, driv- en by demand/supply fundamentals.

In the negative category are • Near term oil & gas prices have fallen to levels that discourage investment.

• Major energy companies have been cutting back on capital expenditures. • More supply has suddenly come into the oil and gas market.

• Shale/tight oil and gas projects are competing for investment funds. • Local content constraints in the supply chain are creating delays and overruns.

• Petrobras, the major customer, is hav- ing serious ? nancial problems.

• Cost of capital for deepwater projects will rise over the next several years.

In the unknown category are • black swan events can (and have) dis- rupt the sector

Interaction of these drivers over the next few years will determine the number and timing of future production ? oater orders.

TheRebound Scenarios

Three plausible forecast scenarios are pro? led in the report that capture a realis- tic range of underlying market conditions likely to prevail over the next ? ve years. • Low scenario:

Sluggish global economic growth, deceler- ating energy demand, strong competition from shale oil, oil prices in the $50 to $60 (Photo: iStock)

November/December 2015 12 MTR

MTR #9 (1-17).indd 12 MTR #9 (1-17).indd 12 12/10/2015 9:25:07 AM12/10/2015 9:25:07 AM