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GLOBAL DEEPWATER REVIEWGLOBAL DEEPWATER REVIEW and the forecast -63%, decrease in deepwater capex for 2015 compared with the previous year, In? eld Systems expects an increase in expenditure in water depths of 500m and greater from 2016 onwards, with key proj- ects anticipated to require investment during this time including the delayed Rosebank project. Investment is also expected to take place on other west of Shetland ? elds with expenditure having been pushed back dur- ing 2014.

Middle East

The Middle East region, although not traditionally seen as a deepwater area of development, is expected to see steady deepwater growth throughout the forecast time- frame, driven by projects such as Noble’s Leviathan development offshore Israel, which could form 44% of the region’s deepwater capital expenditure over the 2015-2019 timeframe. However, recent dif? culties fac- ing Noble and the size of the operator’s current holding in Leviathan may result in delays with the project.

Gumusut Kakap, which came on stream in October 2014, was Shell’s ? rst

BP’s Shah Deniz two step-out wells are also anticipated deepwater project in Malaysia in 1200m water depth.

Photo from Shell.

to require signi? cant investment during the period, the decision to push the development further, while with a with In? eld Systems currently expecting capital expenditure on prevailing low oil price, further delays over the remainder of the second phase of the project to commence in 2016. 2015 may also be announced across the region. Beyond 2016,

Australia however, In? eld Systems expects deepwater expenditure within the Gulf of Mexico to pick up, with a forecast CAGR of some Offshore Australia, while mega-projects are expected to continue 12.6%, between 2015-2019. Key developments are expected to – particularly within the Greater Gorgon Area, the pace of new include Shell’s Appomattox and Stones, and the Anadarko-led deepwater development is forecast to slow. The long-awaited

Heidelberg project. Deepwater spend is expected to peak in Scarborough development has also increased in uncertainty 2019, with North America expected to become the second largest over recent months, with operators of the JV, ExxonMobil and region for capex spend after Latin America. BHP Billiton, requesting an extension of the ? eld’s retention lease while the project partners move towards a ? nal investment

Asia decision. Altogether, In? eld Systems expects deepwater capital

Asia is expected to undergo some of the most robust growth in expenditure offshore Australasia to increase over the forthcom- offshore deepwater expenditure over the forthcoming ? ve years. ing ? ve years despite the less favorable market conditions, with

In? eld Systems’ latest Asia Regional Market Report to 2019 capex spend expected to reach a forecast period peak in 2018. highlights how this pivotal global market is expected to be driven

Conclusion by the Southeast Asian sub-region, in particular Malaysia, with key projects including Petronas PFLNG-2, to be installed on the Altogether, In? eld Systems expects the deepwater market to

Rotan ? eld, and the Shell-operated Ubah gas ? eld development. face a challenging time over the 2015-2016 period, with further

Deepwater development offshore India, driven by Reliance’s delays anticipated as a result of the prevailing low oil price.

Dhirubhai 34 R-Series and the ONGC-operated Krishna-Godavari However, over the longer timeframe, with the ? rst gloss having

UD-1 projects, is also anticipated to be central to the growth of been taken off the US shale oil and gas boom, and unwavering the region’s deepwater market going forwards. growth in energy consumption from transitional economies, exploration and production activity within deep and ultra-

Europe deepwaters can only increase.

Looking towards the North West European Continental Shelf Indeed, beyond 2016, In? eld Systems expects capital (NWECS), In? eld Systems expects capital expenditure within the expenditure within water depths of 500m and greater to see a deepwater sector to remain steady during 2015, predominantly resurgence, with the global deepwater market expected to form as a result of ongoing development of Aasta Hansteen offshore a 51% share of total offshore capex over the entire 2015-2019

Norway. However, 3Q 2014 also witnessed a farm-down of timeframe, fueled by the high productivity of many of the wells several of Statoil’s assets within the Norwegian North Sea area, drilled at these depths. including Aasta Hansteen and its accompanying Polarled pipe-

Catarina Podevyn has been an analyst with In? eld Systems since line, with the operator now looking to refocus strategy elsewhere. 2008, in which time she has worked across a variety of sectors and

Indeed, from 2016 onwards, In? eld Systems expects deepwater authored numerous articles and publications on a wide range of development offshore Norway to decrease year-on-year through subject matter. Her core areas of expertise are within the lloating to 2018, with only the ? nal year of forecast seeing an increase platform sector and the deep and ultra-deepwater market. in investment. Within the UK sector, despite recent uncertainty

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