Page 35: of Maritime Reporter Magazine (June 2012)

cluding protective coatings, electronics, and process systems, valves and flow- lines equipment, and the maintenance ofproduction wells. PLATFORM DRILLING & WELL INTEGRITYDrilling is often regarded as a Capital Expenditure and whilst the majority ofoffshore drilling activity is performed through Mobile Offshore Drilling Units (MODUs) a significant proportion is car- ried out from the actual production plat-form. By its very nature most platform drilling occurs after hook-up and produc-tion has commenced and as such it hasbeen included in our operational expen- diture forecast. Platform drilling is notsolely development, new breakthroughs in directional drilling have seen many sidetracks (extensions of existing well- bores) being used to gather geological data from the surrounding area and hasopened up the potential for exploration drilling to discover stranded reserves in the immediate vicinity. PRODUCTION SERVICES Production services relate to expendi- ture incurred as a result of hydrocarbonproduction ranging from reservoir man- agement, stimulation activities such as perforation & fracturing through to waste management of produced water. Produc- tion services are therefore a combinationof well intervention and services that in- clude wireline operations such as pro-duction logging to coiled tubing work such as fracturing and other pumpingservices. DW?s market forecast for pro- duction services includes: power genera- tion, produced water services, wireline services and stimulation services (prop-pant fracturing and acidization).REGIONAL FORECAST In 2011 demand for offshore operations & maintenance services totalled over $52 billion, having grown at a compound rate of over 6% over the past five years. Over the next five years we expect a greater level of growth as the market recovers from the effects of the global downturn of 2008-2009. This will be driven by a combination of high oil prices, buoyant offshore development activity and ram- pant price inflation for equipment andservices. O&M markets are considerably less vulnerable to downturn than their capital-led counterparts. Whilst global offshore drilling activity dropped by a es- timated 14% between 2008-2009, totaloffshore production (the principal driver for all operational activity) grew by 1%. The global offshore O&M market fell, but only slightly, despite widespread price deflation for equipment and serv-ices. Historical dominance of maturewestern basins is to be challenged. Be-tween 2007-2011, 40% of global demandwas accounted for by Western Europe and North America. Although we expect market growth in all regions (despite the UK and Rest of Western Europe regions facing terminal production decline) we expect the Western Europe and North American share of global demand over the forecast period to drop by a few per- cent. This shift will be driven by a com- bination of increasing offshore production in regions such as the Middle East and the movement towards deepwa- ter in less mature regions such as Africa and Latin America. CONCLUSIONSProduction services dominate O&Mmarket expenditure. Over the 2007-2011 period demand for production relatedservices accounted for 44% of globalO&M demand. These services are di- rectly associated with production levels from offshore facilities and are intensi- fied as an oil or gas reservoir matures and requires additional effort to sustain pro- duction. The inevitable maturing of off- shore fields will drive compound growth of over 7% in the production services sec- tor as operators struggle to come to termswith decreasing downhole pressure and increasing water cuts. The Asset Services market is set to out- grow all other market sectors. For exam- ple, the trend towards leasing of floating production systems has led to substantialgrowth. Between 2012 and 2016 136 new units are expected to be installed of which over half are likely to be leased which will drive significant growth in the Asset Services market over the next five years.June 2012www.marinelink.com 35About the report & the author The World Offshore Operations & Maintenance Market Forecast 2012-2016 contains:  Unique and proprietary data  Regional forecasts  Macro-economic overview  Competitive landscapesJenny HarbourjoinedDouglas-Westwood in 2011 as a Researcher, having pre- viously worked within thefield of industrial energy gen- eration, distribution and effi- ciency measures. She is a graduate from the University of East Anglia?s School of Environmental Sciences. MR June12 # 5 (34-41):MR Template 6/11/2012 1:03 PM Page 35