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Floating to the Fore

By  John Mueller Saturday, 01 December 2012 00:00
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John Mueller reports on floating production

Offshore floating production is a cost effective solution in many oil and gas field applications that is poised to reach new levels of global demand as the trend to deeper water exploitation gains pace.

Producers are turning to deep water as increasing global oil demand is less able to be met by declining onshore production. According to data released by SBM Offshore, daily offshore production is set to increase from 21 million barrels of oil in 2008 to 27 million barrels by 2013.

The move to deepwater and consequent opportunities for floating production vessels is underlined by the abundance of ultra-deepwater capable drilling rigs under construction, many orders having been placed in the latter half of this year alone. Transocean, as one outstanding example, has just contracted four drillships from Daewoo Shipbuilding Marine & Engineering of Korea. Moreover, Sete Brazil placed two exceptional orders with Singapore shipyards, one with Sembcorp Marine for five drillships and another with Keppel Offshore & Marine for five semisubmersibles. Samsung Heavy Industries of Korea also has a number of ultra-deepwater drillships under construction.

Seadrill chairman John Fredriksen, commenting on the overall drilling rig market, has said that there is ‘a unique environment where both daily rates and contract duration are increasing to new highs, while yard prices remain low due to the overcapacity in the shipyard industry. The deepwater drilling industry is transforming from an exploration to a development industry [that] will trigger a significant increase in the need for the drilling of production wells in order to connect the fields that have been successfully explored in recent years.’

Deeper water exploration also translates into a requirement for an abundance of new facilities such as for regasification, and opportunities are seen to exist for the construction of very large FPSOs able to operate in harsh and remote environments.

However, while many FPSOs are under construction, there are signs of a tight supply chain as shipyards traditionally building floating production vessels, as in Singapore and South Korea, will be restricted as they are coping with the fabrication of jackups and record semisubmersible and drillship orders.

Still, ambitious projects are underway and new players are emerging, especially in China

Construction has started on what Shell calls its ‘game-changing’ Prelude floating LNG (FLNG) project with first steel cut on vessel substructure by Samsung Heavy Industries at its Geoje shipyard in South Korea. Scheduled for completion in 2017 and deployment 200km off the coast of Western Australia, the Prelude FLNG vessel will be 1600ft long and 242ft wide, the largest offshore floating facility ever built and requiring over 260,000t of steel, reputedly five times more than that used to build the Sydney Habour Bridge.

prelude flng

The Prelude FLNG unit will produce gas at sea, compress it into LNG and transfer it to transport ships, and is designed to remain on location for 25 years during which time it will produce at least 3.6mtpa of LNG.

Shell sees LNG, as well as natural gas in general, as key to its future, 2012 being the first year the majority of its hydrocarbon will be composed of gas rather than oil. This approach is supported by the IEA (Energy Information Agency) which forecasts global gas consumption increasing by more than a third between 2011 and 2030.

FPSOs are forecast to move from a relative niche product to a mainstream solution of choice in deepwater within the next few years. Floating production units are continually increasing oil productive capacity, becoming more complex with seawater sulphate removal a standard and now fitted out with CO2 removal and re-injection equipment as needed.

More compact FPSOs are also exploiting smaller reservoirs and in the North Sea platforms are being developed using an FPSO.

The future will likely see increased implementation of unique production facilities on board, such as gas-to-liquids, LNG and other gas capture solutions as large-scale LNG projects in Australia and Malaysia come on stream in this decade. FPSOs will also be used to target hydrocarbons in some of the harshest marine environments.

The increased use of FLNG vessels will also be boosted by deployment in distant stranded natural gas fields given new life through pioneering technologies.

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