Westwood’s Global Subsea Tree Tracker
Each month, Westwood’s subsea team provides a global update on subsea tree awards, with data sourced from, and analysed using, the new SubseaLogix service. Bookmark this page for regular updates on the health of the subsea oil and gas sector.
Updated – 4th June, 2020
Brazil: Petrobras continues to focus its resources on pre-salt basin developments with the Mero-2 subsea production package awarded in 1Q 2020. Submission of commercial bids for the Mero-3 and Buzios subsea packages are still anticipated this year despite challenging market conditions.
Nigeria: In May, Shell indefinitely delayed the submission of commercial bids for its long-delayed Bonga SW project. The field was expected to be developed with 20 subsea trees, with peak production of 175 kboe/d.
China: A preferred bidder for CNOOC’s Lufeng 22-1 has emerged and the official contract award for the four subsea tree development is imminent. First oil is currently expected 2H 2022.
- No subsea tree contract awards were announced in May 2020. The probable total order intake for 2020 is now estimated at c.120 subsea trees, 6% lower than Westwood’s projected number as of 4th May 2020 (130 trees) and the lowest since 2016.
- Subsea tree demand over 2020-24 based on probable and possible contract awards is now forecast to total approximately 1,040 units – a 10% downward revision compared to last month’s outlook.
Mark Adeosun
Lead Analyst, Subsea
madeosun@westwoodenergy.com
Updated – 4th May, 2020
Mozambique: ExxonMobil is working on a new plan to sanction its Mamba project in 2021. ExxonMobil stalled the EPC contract award that was planned for 2020, stating the need to optimise its development plans and explore opportunities related to the current market environment.
Australia: In April, Woodside Petroleum awarded TechnipFMC the iEPCI contract for Greater Western Flank Phase III project. The project consists of 4 subsea wells and a production manifold tied back to existing infrastructure.
USA: Shell has delayed the sanctioning of its Whale project in the US GoM until 2021 which was initially planned to reach FID in the first half of this year. Shell has cited supply chain constraints and uncertain economic conditions as the reason for the delay.
- Total order intake for 2020 is now expected to end at c.130 subsea trees, 31% lower than Westwood’s projected number as of 3rd April 2020 (190 trees). As the COVID-19 pandemic continues to constrict the global energy market, E&Ps continue to exercise caution over sanctioning new developments in the near-term.
- As E&Ps continued to announce a wave of project delays and cancellation in April, Westwood’s visible five-year subsea tree demand (2020-24) based on probable and possible contract awards is now forecast to total approximately 1,120 units – a 3% downward revision compared to last month’s outlook.
- Projects to watch in Q2 are Petrobras’ Mero 2 and Marlim revitalisation. However, continued uncertainty in the market means contract awards could be delayed until later in the year.
Mark Adeosun
Lead Analyst, Subsea
madeosun@westwoodenergy.com
Updated – 3rd April, 2020
Senegal – Woodside Petroleum and its field partners reached FID for the Sangomar field in January 2020. An alliance between Subsea 7 and OneSubsea will deliver the integrated subsea solution, with the offshore campaign expected to take place from 2021 to 2023.
2Q 2020 subsea tree orders are expected to total 22 units. However, the timing of official contract awards could be impacted by the COVID-19 pandemic.
Angola – TechnipFMC were awarded the subsea iEPCI contract for the Platina field in Block 18 after BP reached final investment decision for the development late 2019.
- The oil price crash & COVID-19 pandemic has sent subsea tree demand in 2020 into a tailspin, as E&Ps continue to announce capex cuts and project deferrals/cancellations.
- 1Q 2020 subsea tree order intake closed at 34 units – 22 units lower than Westwood’s projection as of 3rd of March. This is due to the continuous delays to the official contract award for Petrobras’ Mero II and the Marlim revitalisation projects in the Santos Basin off Brazil.
- Overall, Westwood’s revised 2020 subsea tree order intake is forecast at c.190 units (including units already ordered in 1Q 2020). This represents a 42% downward revision compared to last month’s projection but still more than double the recorded figure for 2016.
- The visible five-year order outlook (2020-24) is now forecast to total over 1,160 units – a 20% downward revision compared to last month’s outlook.
Mark Adeosun
Lead Analyst, Subsea
madeosun@westwoodenergy.com
Updated – 3rd March, 2020
Norway – Subsea tree order intake over the 2020-2024 period in NW Europe is impacted by Equnior’s decision to re-evaluate its Wisting development due to the high breakeven price.
1Q 2020 – Key awards QTD includes Woodside Petroleum’s Sangomar and Santos’ Van Gogh phase II infill development
Guyana – Delays in the approval of a new regulatory framework has led to the revision of subsea tree contract award timeline for ExxonMobil’s Payara development. Contract award expected in 2Q 2020
- 1Q 2020 subsea tree order intake is expected to total 56 units – as of 3rd March. This is a significant downward revision (51%) from our 3rd Feb projections. ExxonMobil’s Payara FID pushed to 2Q.
- Key projects to watch in 2Q includes ENI’s Mamba, Woodside Petroleum’s Scarborough and Shell’s Whale project.
- Total 2020 subsea tree potential order intake is still projected at over 320 units.
- Visible Five-year potential subsea tree order outlook (2020-24) is now around 290 units a year. This is a 6% downward revision to last month’s outlook.
Mark Adeosun
Lead Analyst, Subsea
madeosun@westwoodenergy.com
Updated – 3rd February, 2020
GoM: TechnipFMC and OneSubsea were awarded industry first 20K subsea trees
114 awards expected in 1Q2020 – a significant YoY and QoQ uptick. Key projects to watch include Mero, Payara and Gumusut Phase III
- 43 tree orders in 4Q2019, down 59 units YoY and resulting in a total 2019 intake of 213 (vs 271 in 2018). 4Q2019 awards were focused in US GoM (Anchor, Shenandoah) and Russia.
- 1Q2020 orders expected to hit 114 – as of 3 Feb, 23 units have been awarded. Total 2020 intake projected at 327.
- Five-year order outlook (2020-24) remains unchanged averaging 310 units a year.
Mark Adeosun
Lead Analyst, Subsea
madeosun@westwoodenergy.com
