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Offshore Market Report Norway
O F F S H O R E M A R K E T R E P O R T N O R W A Y Introduct ion mater ia l
Offshore Market Report Norway 2
Total spending 1985-2020 and company market shares for: • 11 oil service segments level 1 • 50 oil service segments level 2 • 150 oil service segments level 3
The Offshore Market Report Norway is a combined top-down and bottom-up review
Top-down sources
• SSB*: Quarterly investments • NPD: capex and opex (RNB**) per field • Rystad Energy UCube: Forecasting
production, capex and opex based on bottom-up field by field review
*SSB = Statistics Norway (Statistisk Sentralbyrå) ** RNB = The Revised National Budget (Revidert nasjonalbudsjett) *** We present bottom up figures for groups, e.g Aker Solutions consists of several legal companies, but is here presented as the group Aker Solutions
Bottom-up sources • Brønnøysund Register:
P&L for about 1200 legal companies***. Estimates when no Norwegian affiliate
• Company information Rystad interview with management for
split Company reports Business intelligence
• Field information Rystad interview with operators Conferences and other industry research
• Rystad Energy UCube: Forecasting production, capex and opex based on bottom-up field by field review
++
1. 2.
• Define segments • Match different sources • Distribute cost to segments • Field studies • International analogous • Calibration bottom-up vs. top-down
3.
Offshore Market Report Norway
Offshore Market in Norway – definition and overview 2013
Source: SSB; NPD; Rystad Energy research and analysis * We include all purchases within offshore market segments, except office (property, IT, telecom…) and commodities (fuel, power) and purchases/investments done outside Norway (e.g. hull from Korea to rigs).
Total cost for oil and gas companies in
Norway, 2013: NOK 303 billion
Capex in Norway • Exploration • Field development • Brownfield • Pipelines and onshore
terminals • Offices in Norway Reported as “Investments” or “Capex” in license budgets to NPD/RNB and SSB.
Opex and non-op in Norway • Fields/licenses • Pipelines and onshore
terminals tariffs • General costs • Costs for license awards • Taxes and fees • Salaries
Offshore market in Norway, 2013: NOK
319 billion
Not part of offshore market: Salaries, CO2 tax, injection gas
and tariffs
302
250
Offshore market in Norway from Oil companies’ point of view, i.e. market for direct
suppliers
Suppliers’ purchases:
Sub-contracting made by suppliers
in Norway*
This includes purchases done by suppliers in Norway. We include all purchases within offshore market segments, except office (property, IT, telecom…) and commodities (fuel, power)
319 69
Capex Capex
Opex, genex and non-op
Opex, genex and non-op
52
3
Offshore Market Report Norway
36,5
88,9
193,5
2013 NCS offshore market overview
* Field development includes new export pipelines ** Field operation includes operations of export pipelines, onshore terminals and office construction *** Opex includes here Non-op (purchases of seismic and G&G in connection with regional and lease round work, outside license cost) Source: Rystad Energy UCube; Rystad Energy DCube; Statistics Norway; Rystad Energy research and analysis
4
Tariffs, income and petroleum taxes
Oil companies
BNOK 1.1
Salaries and other internal
REVENUE AND FINACING
TAXES AND TARIFFS
Field development*
Market for direct suppliers Capex and Opex***
250 BNOK Market for sub-suppliers Suppliers’ purchases
69 BNOK
BNOK 29.3
BNOK 38.4
35.4
59.6
155.1
Offshore Market in Norway 319 BNOK
Capex Opex Suppliers’ purchases
Offshore Market Report Norway
Oil Service Segment definitions – Level 1 and 2
Source: Rystad Energy
Maintenance Services
Operational and Professional Services
Engineering
Procurement, Construction and Installation
Well Service
Drilling Tools and Commodities
Rigs and Drilling Contractors
Topside and Processing Equipment
Subsea Equipment and Installation
Transportation and Logistics
Seismic and G&G
Segment level 1 and 2 Segment level 2 and 3
Why have we chosen this particular segment definition? In defining the segments we have made a balancing act between several aims: - Easy to remember and give overview - Sufficient detail to be specific and allow data gathering - Sufficient generality to allow company benchmarking and global comparison - Industry jargon if possible - Relevant both for suppliers` market research and oil companies’ procurement analysis For inspiration, we have looked at segment definitions from Achilles (800 product oriented segments), SSBs (40 categories), INTSOK (16 segments) and others. However, our segment definition is genuine and made for the purpose of this report.
Automation and Electro MaintenanceInspection and Maintenance
Metal, pipes and valvesShip and Rig Repair
Government and OrganizationsISO
Operational ServicesProfessional Services
Support ServicesDetailed Engineering
FEED and StudiesOther Engineering and Project Management Services
Subsea EngineeringHull/Structure Construction
Offshore Construction ServicesOnshore Infrastructure Construction
Topside ConstructionArtificial Lift Services
Drilling ServicesWellbore Completion and Re-entry Services
Wireline and Geoscience ServicesCasing and Tubing Steel (OCTG)
Drilling FluidsDrilling Tools
Specialty ChemicalsJack-ups/barges
Platform Drilling ServicesSemi/Drillship
Well Management ServicesBuilding Components
CablesDrilling Rig Equipment
Electro, Instruments, Control and Telecom EquipmentFire and gas detection and prevention
Maritime EquipmentMaterial Handling Equipment
Processing EquipmentRotating Equipment
Subsea EquipmentSubsea Services
SURFTrunkline Construction
Base and LogisticsPetroleum Aviation
VesselsG&G Services
G&G SoftwareG&G Surveys
MultiClient Seismic SalesSeismic Data Processing
Seismic Sales
5
Offshore Market Report Norway
Oil Service Segment definitions – Level 1, 2 and 3
Source: Rystad Energy
Control Room, Tele and IO MaintenanceElectro and Power System Maintenance
Instruments and Measurement MaintenanceInspection
MMO frame agreementsOffshore maintenanceOnshore maintenance
Metal and pipe welding and cuttingPiping Steel
Valve ServicesValves
Ship and Rig RepairGovernmental organizations
Media and EventsNon-governmental organizations
Access and ScaffoldingInsulation/Passive Fire Protection
Other Fabric Maintenance ServicesSurface Treatment and Painting
Field Operation ServicesFiscal metering Services
FPSO RentalPower Supply ServicesStorage vessel Rental
TeleCommunication and IO ServicesCertification and Integrity Services
Financial and Insurance ServicesLegal Services
Management ConsultingMeteorological Services
Product Design and AnalysisR&D Services
Safety, Health and Environment ServicesTechnical work force/operational support
Catering, Cleaning, Security ServicesComputers and Business Software
Offshore Accomodation ServicesOnshore Accomodation Services
Real Estate ServicesDetailed Engineering Hull/Deck
Detailed Engineering Topside/ModulesFEED and Studies
Engineering workforce and servicesOther Engineering and Project Management Services
Subsea Engineering
Auto
mat
ion
and
El
ectr
o M
aint
ena
nce
Insp
ectio
n an
d M
aint
enan
ceM
etal
, pip
es
and
valv
es
Shi
p an d Rig
Re pai r
Gov
ernm
ent a
nd
Org
aniz
atio
nsIS
OO
pera
tiona
l Se
rvic
esPr
ofes
sion
al S
ervi
ces
Supp
ort S
ervi
ces
Det
ail
ed
Engi
neer
ing
FE ED
an d Stu
die s
Oth
er
Engi
neer
ing
and
Proj
ec t M
ana
gem
ent
Se
rvic
es
Su bs ea
En gin
eer
ing
Mai
nten
ance
Ser
vice
sO
pera
tiona
l and
Pro
fess
iona
l Ser
vice
sEn
gine
erin
g
Hull/Structure ConstructionOffshore Loading Equipment/Turrets
Decommissioning and Abandonment ServicesHeavy Lift
Hook-up, systems testingMooring and floater installations
Onshore Hook-up and System TestingOnshore Infrastructure Construction
Onshore Office ConstructionLiving Quarter Module Construction
Module Construction BrownfieldModule Construction Greenfield
Module Support Frames and Deck ConstructionOffshore Aluminium and Helidecks
Electrical Submersible PumpsGas Lift Systems
Directional Drilling ServicesMud Services
MWD and LWD systemsOther Drilling Services
Well Production TestingCasing, Tubing and Liner running Services
Cement ServicesFishing Services
Other Well Completion ServicesPacker Systems and Plugs
Plugging, well wash, gravel packing and other well servicesRe-Entry and thru-tubing Services
Sand ScreensSubsurface Safety systems and Flow Control
Cased Hole WirelineCoring and other well G&G Services
Geoscience Consulting Open Hole Wireline
Casing and Tubing Steel (OCTG)Cement
FuelMud
Waste Management and water disposalBlowout Preventers
Downhole Drilling ToolsDrill Bits
Drill Pipe, jars and collarsCompletion Fluids and Additives
Corrosion, hydrate and paraffin inhibitorsH
ull/
Str
uctu
re
Cons
truc
tion
Off
shor
e Co
nstr
uctio
n Se
rvic
es
Ons
hore
In
fras
truc
ture
Co
nstr
uct
ion
Tops
ide
Cons
truc
tion
Artif
ici
al L
ift
Serv
ices
Dril
ling
Serv
ices
Wel
lbor
e Co
mpl
etio
n an
d Re
-en
try
Serv
ices
Wire
line
and
Geo
scie
nce
Serv
ices
Ca sin g an d Tu bin g Ste el
(O CT G)
Dril
ling
Flui
dsD
rillin
g To
ols
Spec
ialty
Ch
emi
cals
Proc
urem
ent,
Cons
truc
tion
and
Inst
alla
tion
Wel
l Ser
vice
Dril
ling
Tool
s an
d Co
mm
oditi
es
6
Offshore Market Report Norway
Oil Service Segment definitions – Level 1, 2 and 3
Source: Rystad Energy
Jack-ups/barges
Platform Drilling Services
Semi/Drillship
Well Management Services
Building Materials and Furniture
HVAC Systems and equipment
Lighting and Heating
Cables
Drilling Rig Equipment
Control Room and Automation Equipment
Electrical Equipment - other
Electrical Equipment - Transformers, Rectifiers, Converters
Instruments
Telecommunication and IO Equipment
Fire and gas detection and prevention
Maritime Equipment
Cranes, Winches, Spoolers and Lifts
Other Material Handling Equipment (Trucks, feeders, packing..)
Chemical Injection Systems
Heaters and heat transfer equipment
Separators and Gas treatment
Tanks and Columns
Compressors
Generators and Transformers
Motors and Turbines
Power Generators
Pumps
Control Systems
Other Subsea Tools
Subsea testing, tool pool and other subsea services
Templates and Manifolds
Trees and Wellheads
Flow assurance Services
IMR (Subsea Inspec, Maint, Repair (ROV+Diving))
Pipeline Systems
Risers
Subsea Installation
Umbilicals
Trunkline Construction
Jac k- ups
/ba
rge s
Plat for
m
Dril
ling
Ser
vic es
Se mi/
Dril
lshi p
We ll Ma
nag
em ent
Ser
vic es
Build
ing
Com
pone
nts
Cab
les
Dril
ling
Rig
Equ
ipm
ent
Elec
tro,
In
stru
men
ts,
Cont
rol a
nd
Tele
com
Eq
uipm
ent
Fire
an
d ga
s de
tec
tion
an
d pr
eve
ntio n
Ma
riti
me
Equ
ipm
ent
Mat
eri
al
Han
dlin
g Eq
uipm
ent
Proc
essi
ng
Equi
pmen
tRo
tatin
g Eq
uipm
ent
Subs
ea E
quip
men
t
Subs
ea
Serv
ice
sSU
RF
Tru
nkli
ne
Co nst
ruc
tio n
Rigs
and
D
rillin
g Co
ntra
ctor
sTo
psid
e an
d Pr
oces
sing
Equ
ipm
ent
Subs
ea E
quip
men
t and
Inst
alla
tion
Containers and speciality equipments
Supply Base Operations
Petroleum Aviation
Anchor Handling Vessels
Crew Vessels
Other Vessels
Shipping Equipment and Marine Technology
Supply Vessels
Surveying, Positioning and Oceanographic Services
Field G&G Services
Field G&G Studies
G&G and Petrophysical interpretation Services
Reservoir Management Services
Geology and Seismic Software
Reservoir Modelling and Simulation
Well and Pipeline Flow Modelling
Geotechnical/Site Surveys
Gravity and Magnetic Services
2D MultiClient Seismic Sales
3D MultiClient Seismic Sales
Seismic Data Processing
2D Contract Seismic
3D Contract Seismic
4C Contract Seismic
4D Contract Seismic
Electromagnetic Seismic Services
Land Seismic
Base
and
Lo
gist
ics
Petr
ole
um
Avia
tio
nVe
ssel
sG
&G
Ser
vice
sG
&G
Sof
twar
eG
&G
Su
rvey
s
Mul
tiClie
nt
Seis
mic
Sa
les
Seis
mic
D
ata
Proc
essi
ng
Seis
mic
Sal
es
Tran
spor
tatio
n an
d Lo
gist
ics
Seis
mic
and
G&
G
7
Offshore Market Report Norway 8
Report structure ideal for organizations of different size to tailor make their own report
Chapter 1: NCS offshore market history Chapter 2: NCS offshore market forecast Chapter 3: Maintenance services Chapter 4: Operational and professional services Chapter 5: Engineering Chapter 6: Procurement, construction and installation Chapter 7: Topside and processing equipment Chapter 8: Well services Chapter 9: Drilling tools and commodities Chapter 10: Rig and drilling contractors Chapter 11: Subsea equipment and installation Chapter 12: Transportation and logistics Chapter 13: Seismic and G&G Chapter 14: NCS field by field platform review
Basic Section: Chapter 1: NCS offshore market history Chapter 2: NCS offshore market forecast + 1 chapter free of choice
Chapter overview
Tailor make a report ideal for your organization
Ideal for smaller companies active in single segment
Basic Section + additional chapters
Ideal for larger service companies active in several segment and banks/investor houses
Chapter 1-2: NCS macro: Unique insight in the historic and future development of exploration activity, cost development, production and investment levels split in (~40 pages) Chapter 3-13: Segment by segment review 2010 market on level 3, forecasts on level 2 to 2020, detailed player overview with 2010 revenue (10-20 pages per segment) Chapter 14: NCS field by field platform review Facts and figures on all installations at the NCS, recently performed large modification and upcoming modification projects (~55 pages)
Offshore Market Report Norway 9
Offshore Market Report Norway
Property of Rystad Energy
Offshore market 2013 (excl. onshore terminals), split by area, operator and facility type
Source: Rystad Energy UCube; Rystad Energy research and analysis
28
Area-split Operator split Facility split
Facility Category Share 2013
Steel platform 27,9 %
Subsea tie back 26,7 %
Concrete GB 14,9 %
FPSO 10,5 %
Semi 8,9 %
Fixed and floater 6,8 %
TLP 3,8 %
Extended reach 0,4 %
Spar 0,2 %
Operator Share 2013Statoil 59,8 %ConocoPhillips 10,9 %Shell 5,0 %BP 4,2 %Lundin Petroleum 3,8 %Total 2,9 %ExxonMobil 2,8 %Talisman Energy 2,1 %Marathon Oil 2,1 %BG 1,8 %Eni 1,7 %Det norske oljeselskap 1,2 %GDF SUEZ 1,1 %Wintershall 0,3 %DONG 0,1 %Other 0,2 %
Area Share 2013Tampen Area 23,6 %Ekofisk Area 14,2 %Aasgard Area 9,8 %Troll Area 9,1 %Grane Area 8,4 %Sleipner Area 5,9 %Oseberg Area 5,6 %Norne Area 5,0 %Ormen Lange Area 3,4 %Draugen Area 2,8 %Frigg Area 2,8 %Hild Area 2,7 %Ula Area 1,6 %Goliat Area 1,6 %Snohvit Area 1,6 %Other 1,9 %
Offshore Market Report Norway
Property of Rystad Energy
2013 field cost (capex and opex excl. onshore infrastructure), by top 80 field/licenses
Source: Rystad Energy research and analysis based on NPD field level numbers for capex and opex. Exploration capex in licenses not included in NPD statistics; source is Rystad Energy UCube
29
2013 field/license opex and capex, by cost typeNOK million nominal
12 58911 531
11 16411 128
8 7748 205
7 6797 666
7 5066 9706 949
6 5016 083
5 9055 497
5 3245 313
4 9054 760
4 6794 332
4 1274 097
4 0274 020
3 9123 856
3 7533 7153 706
3 4753 475
3 3143 1823 156
3 0732 867
2 7912 757
2 482
Gullfaks SouthTroll OilEkofisk
Troll East (Gas)Aasgard
Ormen LangeGoliat
Ekofisk SouthGullfaks
ValemonStatfjord
Edvard GriegSnorre
Eldfisk IIOseberg
ValhallSkuld
GudrunBalder/Ringhorne
DraugenMartin Linge
Oseberg SouthAasgard LP
VolveKnarr
KvitebjornHeidrunVisundGrane
TyrihansVigdisNorneSkarv
EldfiskVarg
BrynhildGjoa
SleipnerSnohvit Phase 1
Ivar Aasen
Exploration capexDevelopment capexWell capexMMO and expansion capexSubsea brownfield capexOpexAbandonement cost
2 4762 469
2 4072 355
1 8321 822
1 7681 577
1 5211 487
1 3981 344
1 2401 2211 211
1 1811 1361 1311 128
1 0541 049
1 0161 006994989985
932929918905
830791789762757754746745744717
KristinValhall IOR
16/2-6 (Johan…NjordGyda
UrdAlvheim
BoylaVeslefrikk6406/9-3…
16/2-6 (Johan…Other…Brage
Visund SouthHeimdal
VegaOseberg East
Other…Jotun
PL529SvalinPL457
ViljeFram
35/9-7 (Skarfjell)Tordis
7225/3-1…Gina Krog…
Visund North16/4-6S (Luno…Total_Norway
7120/1-3…Ula
PL511MorvinMikkel
VolundJette
34/10-C-18 A6407/8-6…
Offshore Market Report Norway
Property of Rystad Energy
Offshore market in Norway 2013, by oil service segments level 1 and 2
Source: SSB (Investment part); NPD (Opex part (RNB)); Brønnøysund (Company data as calibration); Rystad Energy (Research for distribution into sub-segments)
27
Offshore Market in Norway, by main segment and split by level 2NOK million Level 2 segments
0 10 000 20 000 30 000 40 000 50 000
Seismic and G&G
Transportation and Logistics
Subsea Equipment and Installation
Drilling Tools and Commodities
Well Service
Rigs and Drilling Contractors
Topside and Processing Equipment
Procurement, Construction and Installation
Engineering
Operational and Professional Services
Maintenance Services
Automation and Electro MaintenanceInspection and MaintenanceMetal, pipes and valvesShip and Rig RepairGovernment and OrganizationsISOOperational ServicesProfessional ServicesSupport ServicesDetailed EngineeringFEED and StudiesOther Engineering and Project Management ServicesSubsea EngineeringHull/Structure ConstructionOffshore Construction ServicesOnshore Infrastructure ConstructionTopside ConstructionBuilding ComponentsCablesDrilling Rig EquipmentElectro, Instruments, Control and Telecom EquipmentFire and gas detection and preventionMaritime EquipmentMaterial Handling EquipmentProcessing EquipmentRotating EquipmentJack-ups/bargesPlatform Drilling ServicesSemi/DrillshipWell Management ServicesArtificial Lift ServicesDrilling ServicesWellbore Completion and Re-entry ServicesWireline and Geoscience ServicesCasing and Tubing Steel (OCTG)Drilling FluidsDrilling ToolsSpecialty ChemicalsSubsea EquipmentSubsea ServicesSURFTrunkline ConstructionBase and LogisticsPetroleum AviationVesselsG&G ServicesG&G SoftwareG&G SurveysMultiClient Seismic SalesSeismic Data ProcessingSeismic Sales
Offshore Market Report Norway
Property of Rystad Energy
Share of spend, by context and asset type, 1985-2013
Sources: SSB; NPD; Rig rate overview; Rystad Energy
Selected observations: • Recent years:
- 60% investments - 15-20% operating expenses- ~20% supplier expenses
Selected observations: • Fields in operations stabilized at ~55% since 2006• Fields under development down from 56% in 1998 to 16% of total
spend in 2004 – increasing up to 30% in 2010’s• Exploration up from 4% in 2003 and 2004 to 14% of total in 2009
and staying above 10% since• Onshore terminals peaked above 15% in early 2000’s, steadily
decreased towards 2-5% in 2010’s
By purchase contexpercent
By main asset typepercent
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1985 1989 1993 1997 2001 2005 2009 2013Capex OpexSuppliers purchases Non OpGenex
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1985 1989 1993 1997 2001 2005 2009 2013
Exploration Fields under development Fields in operationPipes under development Pipes in operation Office constructionOnshore Terminals
19
Chapter 1: NCS offshore market history
Introduction with observations and comments on the NCS historical development
Offshore Market Report Norway
Property of Rystad Energy
Market observations and trends
* Note: Deviates from SSB figures at 209 as SSB figures contains internal spend. Source: Rystad Energy; SSB
Topic Summary and impact
History review of Offshore Market
Double digit growth last three years, slowdown in growth expected in 2014- 2010-2011: 19% Driven by fields under dev. (+47% from 43 to 63 bn) and fields in op. (+15% from 117 to 134 bn)- 2011-2012: 17% Driven by fields under dev. (+27% from 63 to 80 bn) and fields in op. (+19% from 134 to 159 bn)- 2012-2013: 14% Driven particular by exploration (+25% from 33 to 41 bn) and fields under dev. (+13% from 83 to 94 bn)- 2013-2014[E]: 6% Growth expected to cool down for exploration and fields in operations while fields under development expected to
continue strong growth as field development activity expected to peak (for now) in 2014.2013 market ended up at 319 billion NOK; Investments at 198 bn*, opex at 52 bn and suppliers expenditures at 69 bn.
Segment review
All time high investments in fields under development: - Capex (including internal spend) in fields under development has increased from the bottom point of NOK 18 bn in 2004 to 80 bn in 2013.
This represent an annual growth of 19%.- Due to this, the growth has been particularly strong the following segments: Engineering; Procurement, construction and installation;
Topside and processing equipment and Subsea equipment and installation.
Exploration levels at all time high – indications of slowdown going forward: - Due to higher oil price, good exploration results and two governmental initiatives - APA (awards in predefined areas) and cash back (78%
of exploration expenses reimbursed following year), exploration investments have increased from 4 bn in 2004 to 37 bn in 2013 – an annual growth of 27%. 2014 looks to end at or below 2013 levels, setting the scene for lower exploration levels going forward (see ch. 2)
- This growth is mainly reflected in the well related segments Well services, Drilling tools and commodities and Rigs and drilling contractors in addition to Transportation and logistics.
Fields in operation is the largest segment with respect to investments, also with an all time high investment level in 2013:- Fields in operation has seen a less aggressive growth than the two discussed above, however also a double digit annual growth from
2004 to 2013 with 13%: from 60 bn in 2004 to 181 bn in 2013.- This growth is reflected across all segments, but is most linked to brownfield segments such as Maintenance services and Operational
and professional services.
Exploration
2013 slightly below exploration trend, but with all time high number of wildcats, 2014 looks to be saved by Alta:- 2010: 36 wildcats, 10 appraisals. 827 mmboe discovered resources- 2011: 35 wildcats, 17 appraisals. 2882 mmboe discovered resources (Note: Norvarg removed – relinquished)- 2012: 26 wildcats, 17 appraisals. 1026 mmboe discovered resources- 2013: 44 wildcats (all time high), 14 appraisals. 738 mmboe discovered resources- 2014 level expected to be slightly lower than 2013, with YTD results below recent years success rate: 361 mmboe discovered resources
before Alta well (Lundin) from discoveries like; Pil (VNG), Drivis (Statoil) and Valemon Nord (Statoil). Alta well announced Oct. 14 with a range of 125-400 mmboe, possibly reaching above 700 mmboe with several wells still to be drilled.
14
Detailed overview of historical E&P spending; Yearly and quarterly statistics broken down in several multiple ways:
Offshore Market Report Norway
Property of Rystad Energy
Offshore market in Norway 2004 - Q4** 2014, quarterly, by context
* See introduction for description of context; ** Q3 and Q4 estimates for capex from SSB (reported by oil companies)Source: Rystad Energy based on SSB and NPD; Note: Suppliers purchase estimated, and includes construction of drilling rigs in Norway (11 in 1970s, 1 in 1984, 2 in 2008)
Total Offshore Market in NorwayNOK million nominal
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
80 000
90 000
100 000
1-04 3-04 1-05 3-05 1-06 3-06 1-07 3-07 1-08 3-08 1-09 3-09 1-10 3-10 1-11 3-11 1-12 3-12 1-13 3-13 1-14 3-14
Genex
Non Op
Suppliers purchases
Opex
Capex
16
[E**]
Offshore Market Report Norway
Property of Rystad Energy
Offshore market in Norway 1985-2013, by asset type
Source: Rystad Energy, primarily based on SSB
Total Offshore Market in Norway, by asset typeNOK million nominal
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Onshore Terminals
Office construction
Pipes in operation
Pipes under development
Fields in operation
Fields under development
Exploration
18 Offshore Market Report Norway
Property of Rystad Energy
Offshore market in Norway 1985 – 2013, by main oil service segment
Source: Rystad Energy based on SSB and industry research
22
Offshore Market in NorwayNOK million nominal
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Maintenance Services
Operational and Professional Services
Engineering
Procurement, Construction and Installation
Topside and Processing Equipment
Rigs and Drilling Contractors
Well Service
Drilling Tools and Commodities
Subsea Equipment and Installation
Transportation and Logistics
Seismic and G&G
i) Category (opex, capex,..)
ii) Asset type (exploration, development,…)
iii) Oil service segment
Well-by-well overview of exploration results since 2000
Offshore Market Report Norway
Property of Rystad Energy
Offshore Market Report Norway
Source: Rystad Energy based on SSB and industry research
Offshore Market in Norway NOK million nominal
10
Main Oil Service Segments:
Example: Offshore market in Norway 1985 – 2013, split by 11 main oil service segments
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Maintenance Services
Operational and Professional Services
Engineering
Procurement, Construction and Installation
Topside and Processing Equipment
Rigs and Drilling Contractors
Well Service
Drilling Tools and Commodities
Subsea Equipment and Installation
Transportation and Logistics
Seismic and G&G
Offshore Market Report Norway 11
Offshore Market Report Norway
Property of Rystad Energy
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
5 000
2000 2005 2010 2015 2020 2025
Undiscovered, Open acreageUndiscovered awardedDiscovery (1970s)Discovery (1980s)Discovery (1990s)Discovery (2000s)Discovery (2010s)AppraisingField evaluationUnder developmentProducing earlyProducing 25-50%Producing 50%-75%Producing >75%Producing (Refinery Gains)Abandoned
NCS production forecast by life cycle
Note: Currently uncommercial volumes not includedSource: Rystad Energy UCube
55
Production by lifecycleThousand boe/d
Life cycle
Offshore Market Report Norway
Property of Rystad Energy
Updates and changes
Source: Rystad Energy
47
Topic Summary and impact
NCS Production forecast
The profiles have been updated according to the latest version of Rystad Energy UCube, including all recent discoveries and appraisals. Changes since last report limited to minor fields with limited effect on overall level
Offshore Market forecast
2014 level with insignificant change since last version of this report (Q2). The 2015-level has been taken down with 7% to reflect a- Slowdown in the brownfield market: Very few new modification projects awarded over the last year- Lowered expectations for exploration: SSB estimates for exploration in 2015 is down 9% from 2014 levels, and the rig count is down as
discussed above. The forecast has also been adjusted down in both the medium and long term to reflect the negative trends as discussed in the beginning of this chapter: Aggregated levels for 2016-2019 are adjusted down with 11%, and 2020 down with 6%.
Important changes in segment forecasts:- Maintenance Services + Operational and Professional Services: The two segments most affected by the day-to-day activity level has
been adjusted down to reflect the lowered activity as indicated by the top players within MMO and ISS. Aggregated level 2015-2020 adjusted down by 5%
- Engineering + Procurement, Construction and Installation: The effect of delayed and cancelled projects like Hod and Valhall wellhead platforms results in a declining EPCI market from 2016 to 2019, with annual estimates adjusted down with an average of 11% from 2017-2019.
- Topside and Processing Equipment: 2014 level unchanged, but 2015 estimate is struck hard with the coupling of low modification activity and sunk capex for several of the ongoing field developments. 2015 adjusted down 19% compared to Q2 forecast and 2016-2019 levels adjusted down with an average of 10% with a slow uptake in modifications and lack of new greenfield projects.
- Well Service + Drilling Tools and Commodities + Rigs and Drilling Contractors: Additional rigs taken out of the market (suspended/cancelled contracts) contribute to a somewhat lower market than previously estimated.
- Subsea Equipment and Installation: The subsea market is reduced considerably in the time frame 2017-2019 with aggregated level down some 30% from Q2 version as field development activity is expected to be reduced with Statoil putting its breaks on. Overall, the market forecasts for Subsea Equipment and SURF show a more volatile development year to year, to account for the cyclical field development market.
Company reported figures Company revenue updated and now shows 2013 revenue fro most players. Expected 100% coverage in Q4 release.
Insight Insight 1: Analysis of previous Offshore Market forecasts by Rystad Energy
Chapter 2: NCS offshore market forecast
Introduction with observations and changes in the market forecast
Key topics discussed in media: A section discussing the hot topics in the media with implications for the market
i) Rigs being put on hold, ii) Lay-offs in oil service,…
i) Top 50 oil field service companies ii) International revenue , …
Production profiles 2000-2025 in different breakdowns
i) Life cycles
Market forecasts presented in different breakdowns
Offshore Market Report Norway
Property of Rystad Energy
Key topics discussed in media Q3 2014 (1/3) – Statoil with overcapacity in NCS rig portfolio
* Day rate for original contract ending Aug 2014Source: Rystad Energy, offshore.no, offshoreenergytoday.com, statoil.com
44
Topic Summary and impact
Headline(s)Statoil ends Ocean Vanguard contract (In the news: June 2014)Statoil suspends Scarabeo 5 contract (In the news: July 2014)COSL Pioneer temporarily suspended (In the news: September 2014)
Summary of news articles
Over the last quarter, Statoil has suspended or cancelled a total of three rigs active on the NCS:
Ocean Vanguard, originally contracted until February 2015 with Statoil at 454 000 USD/day terminated from August 2014The 32 year old rig owned by Diamond Offshore was planned to drill for Statoil in UK in June 2014, before coming back to the NCS for the last period of the contract. Due to confidentiality terms in the contract with Diamond offshore, Statoil has not given any statement to why it terminated the contract. According to offshore.no, industry sources has claimed the contract was terminated due to i) excessive downtime, and ii) the rig does not have automated fire vents as required by the Petroleum Safety Authority (PSA). However, Diamond Offshore has an exemption to operate without automated fire vents on ocean Vanguard.
Scarabeo 5, contracted until 2017 with Statoil at 399 000 USD/day temporarily suspended (July 2014)Due to overcapacity in the rig portfolio, Statoil suspended the contract for Scarabeo 5 (14 years old) for the remainder of 2014 in July. It was drilling at Visund at the time. “We are planning for the rig to be in operation again after the turn of the year. (…)”, said Statoil’s Tore Aarreberg, rig procurement responsible .
COSL Pioneer, contracted until 2016 with Statoil at 320 000 USD/day* temporarily suspended (September 2014)Statoil stated in a press release September 17th: “Due to overcapacity in our rig portfolio, Statoil will lay up the COSL Pioneer rig in the fourth quarter of 2014.” “After a careful review of our drilling plan, we find it necessary to suspend COSL Pioneer for the time being,” says rig procurement responsible Tore Aarreberg.
Key segments affected Rig and drilling contractors, Well services and Drilling tools and commodities
Rystad Energy take away and expected market impact
Statoil reports that the change “(…) will have no impact on Statoil’s production targets or planned exploration activity on the NCS
We see a reduced rig demand in 2015 compared to 2014, primarily driven by lower willingness to explore, but also certain field-developments and infill drilling campaigns being pushed to the right. Current outlooks call for activity to pick up again into 2016 and beyond. However, the massive influx of rigs that the NCS have seen past years, and will see coming years (confirmed Songa andMaersk rigs with possible additions of speculative newbuilds such as North Sea Rigs, Stena, etc.) creates an oversupplied situation that will last for several years. 2014-levels in the Rig and drilling contractors segment is down by 4% compared to Q2, and 2020 levels are down by 14%. Well services and Drilling tools and commodities are both adjusted down with 1% in 2014, and 13% in 2020.
Offshore Market Report Norway
Property of Rystad Energy
Market observations and trends (1/2)
Source: Rystad Energy
48
Topic Summary and impact
PDO activity
PDO activity down in 2013, possible rebound in 2014/15- 2011: 12 PDOs approved: Hyme, Visund North, Vigdis Northeast, Stjerne, Vilje South, Brynhild, Knarr, Visund South, Valemon, Atla,
Ekofisk South and Eldfisk II- 2012: Seven PDOs approved: Skuld, Åsgard subsea compression, Jette, Edvard Grieg, Martin Linge, Bøyla and Svalin- 2013: Five PDOs approved: Aasta Hansteen, Ivar Aasen, Gina Krog, Fram H North and Oseberg Delta 2- 2014/15: 15 possible PDOs – several in danger of being delayed:
- Ten in the North Sea; Flyndre (approved March 2014), Johan Sverdup (already contract award for two jackets to Kværner) and Bream. Uncertain: Fulla and Krafla (possible area development), Gullfaks Rimfaksdalen, Skarfjell, Tommeliten Alpha, Astero, Mackerel and Alfa Sentral
- Four in the Norwegian Sea; Maria and Zidane (postponed from Oct. 2014). Uncertain: Fogelberg and Trestakk- One in the Barents Sea; Johan Castberg (most likely delayed to 2016 or 2017 as concept selection delayed to mid-2015)
Field development projects
Large pipeline of field development projects: Rystad Energy see a total of 11 fixed platforms (down 3), 3-7 Semi/FPSOs (up 2, note threewith start-up in 2021) and 12-40 subsea candidates (down 20-30) for first oil from 2014-2020. Key updates/observations:- Valemon looks to meat estimated start-up in Q4 2014. No impact on forecast- Goliat delayed. Rystad Energy has estimated start-up of Goliat late 2015, operator state mid 2015. No impact on forecast.- Ongoing field developments: Spend updated to reflect latest budget estimates (National budget released October 2014). Early indications
of possible delays from projects under construction in Asia not yet reflected in forecast.- Johan Sverdrup start-up remains unchanged with estimated start-up 2020- Yme redevelopment: Yme license partner Lotos has chosen to write down the value of the Yme field to zero. Possible new development
pushed out into the 2020’s (start-up 2020 in Q2). EPCI segments impacted.- Knarr start-up pushed into 2015. Limited impact on forecast as most capex is sunk.- Johan Castberg concept selection delayed until mid-2015 which will delay PDO submission and consequently start-up. Rystad Energy
with Castberg start-up to 2021, as in Q2. No impact on forecast.- Several subsea candidates pushed beyond 2020. Impact on subsea forecast.
New acreage
- APA2014 has been announced and the predefined area has been expanded by a total of 9 blocks. The area around Aasta Hansteen has been expanded by 6 blocks while the area west of Snøhvit has been expanded by 3 blocks. Licenses awards are expected early 2015 (Feb). 47 companies applied, down from 50 in APA 2013.
- Round 23 postponed with one year as described above. 160 blocks nominated by 40 companies; 140 in the Barents Sea, 20 in both the Norwegian Sea and North Sea. 86 blocks nominated by two or more companies.
Offshore Market Report Norway
Property of Rystad Energy
Market observations and trends (2/2)
Source: Rystad Energy
49
Topic Summary and impact
Modification market
As stated over the last year, Rystad Energy has seen a slowdown in the modification/brownfield market closing in. Having seeninvestments (capex excluding wells) in producing fields growing from 29 bn in 2010 to 49 bn in 2013, the market is now experiencing a cool down on short to medium term. SSB report estimates on 46 bn (down 6% from 2013) for 2014 and 32 bn for 2015 (down 31% from 2014E). The drops are in the same order as stated by SSB in Q2 with a smaller drop in 2014; Down 9% in 2014 and 31% in 2015. Thelatest figures from SSB are reflected in the updated forecast, however with a smaller drop in 2015 as discussed in the insight in the Q2 release of this report.
Earlier disappoint-ments in the Barents Sea now followed by another Lundinsuccess
- Following Statoil’s breakthrough in the Barents with the high impact discoveries Skrugard and Havis (later Johan Castberg), the exploration results in the surrounding area have been disappointing. Statoil released an exploration agenda for the Johan Castbergarea in 2013, including five prospects (Skavl, Drivis, Iskrystall, Nunatak and Kramsnø) . Skavl and Drivis resulted in small oil discoveries while the other three wells found small gas volumes. Statoil’s Pingvin and Isfjell exploration wells nearby failed to provide additional oil resources for a future Johan Castberg development.
- October 14, Lundin announced a discovery in the Alta well north east of the Gohta discovery. Early estimates indicate between 125-400 mmboe (88-314 oil). Current combined resource base for Gohta and Alta is up to 632 mmboe according to Lundin, and could support a stand alone field development. In comparison, the Goliat field currently under development holds 174 million barrels of oil.
NCS Rig market
All time high number of rigs on the NCS in 2013 – continued growth towards 2017 with Statoil challenging the market - Year end 2013: 38 active rigs during (34 in 2012, 31 in 2011)- 2015 [E]: The number of rigs is expected to grow to 42 within 2015 (all currently contracted. Note: 2 units leaving 2015 versus Q2
projections). - 2017 [E]: The number of rigs is expected to grow to 45+ within 2017 (32 with contract for NCS in 2017, 45 rigs at NCS assuming
renewals).
Quarterly insights: A section discussing topics related to recent research by Rystad Energy
Offshore Market Report Norway
Property of Rystad Energy
Source: Companies’ annual reports as reported to Brønnøysund; Rystad Energy research and analysis
0 5 10 15 20 25 30
Aker SolutionsSchlumberger
AibelKværner
Vard GroupSubsea 7
FMC TechnologiesTransoceanHalliburton
SeadrillBaker Hughes
National Oilwell VarcoTechnip
GE EnergyABB
MaerskRolls-Royce Marine
ArcherIKM Gruppen
WestconKleven Maritime
Fred Olsen EnergyOdfjell DrillingNorsea Group
Songa OffshoreKongsberg Gruppen
ApplyOceaneering
Cameron NorgeCOSL Drilling
As of the publication of this reportover 90 % of the companies coveredin this report have reported their2013 numbers, and the segmentchapters are updated to include 2013numbers for most companies.
The chart shows revenue for the 30largest companies with reported2013 figures ( by sum of 2012 and2013). Of the largest companies, onlyOneSubsea and Bilfinger have notyet reported their 2013 numbers. 23of the companies in the chart report agrowth in revenue while 7 report adecline, which support RystadEnergy’s view of continued growthfrom 2012 to 2013.
Especially the large EPC companiesAibel and Kværner Stord post largegrowth driven by large EPC projects.In the Subsea construction space,Technip and EMAS-AMC both reportdouble digit growth.
Aggregated 2013 numbers show arevenue growth of about 10%. Thisnumber is not expected to changesignificantly, as most companieshave now reported their 2013revenues.
Over 90 % of 2013-numbers now reported – shows 10 % growth from 2012 to 2013
NCS revenues for largest companies with 2013 reportingBillion NOK
52
20122013 higher2013 lower
285 313
2012 2013
Aggregated revenue for companies with 2013 reportingBillion NOK
Insight Q3 2014
+10%
Offshore Market Report Norway
Property of Rystad Energy
0
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Lotos (Petrobaltic)
Premier Oil
Suncor Energy
DONG
Refinery Gains
RWE
BG
Centrica Energy
Talisman Energy
Eni
Total
Lundin Petroleum
GDF SUEZ
Wintershall
ExxonMobil
Det norske oljeselskap
BP
Shell
ConocoPhillips
Statoil
NCS production forecast by operator
Note: Currently uncommercial volumes not includedSource: Rystad Energy UCube
57
Production by operatorThousand boe/d
Operator (top 20)
Offshore Market Report Norway
Property of Rystad Energy
NCS production forecast by province and area
Note: Currently uncommercial volumes not includedSource: Rystad Energy UCube
59
Production by provinceThousand boe/d
Production by areaThousand boe/d
0
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2000 2005 2010 2015 2020 2025
Grane/Utsiraarea
Troll area
Oseberg areaSnøhvitarea
Aasgard area
ii) Operators
iii) Provinces,….
NCS Offshore Market forecast, by main oil service segment
Source: Rystad Energy research and analysis
2
Offshore Market by main segmentNOK million nominal
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
2005 2008 2011 2014 2017 2020
Maintenance Services
Operational and Professional Services
Engineering
Procurement, Construction and Installation
Topside and Processing Equipment
Rigs and Drilling Contractors
Well Service
Drilling Tools and Commodities
Subsea Equipment and Installation
Transportation and Logistics
Seismic and G&G
Oil Service SegmentNCS Offshore Market forecast, by life cycle
Source: Rystad Energy research and analysis
3
Lifecycle as of 2014
0
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Offshore Market by life cycleNOK million nominal
Offshore Market Report Norway
Example Q3 2014 (released October): Key topics discussed in media Q3 2014 (1/3) – Statoil with overcapacity in NCS rig portfolio
* Day rate for original contract ending Aug 2014 Source: Rystad Energy, offshore.no, offshoreenergytoday.com, statoil.com
12
Topic Summary and impact
Headline(s) Statoil ends Ocean Vanguard contract (In the news: June 2014) Statoil suspends Scarabeo 5 contract (In the news: July 2014) COSL Pioneer temporarily suspended (In the news: September 2014)
Summary of news articles
Over the last quarter, Statoil has suspended or cancelled a total of three rigs active on the NCS: Ocean Vanguard, originally contracted until February 2015 with Statoil at 454 000 USD/day terminated from August 2014 The 32 year old rig owned by Diamond Offshore was planned to drill for Statoil in UK in June 2014, before coming back to the NCS for the last period of the contract. Due to confidentiality terms in the contract with Diamond offshore, Statoil has not given any statement to why it terminated the contract. According to offshore.no, industry sources has claimed the contract was terminated due to i) excessive downtime, and ii) the rig does not have automated fire vents as required by the Petroleum Safety Authority (PSA). However, Diamond Offshore has an exemption to operate without automated fire vents on ocean Vanguard. Scarabeo 5, contracted until 2017 with Statoil at 399 000 USD/day temporarily suspended (July 2014) Due to overcapacity in the rig portfolio, Statoil suspended the contract for Scarabeo 5 (14 years old) for the remainder of 2014 in July. It was drilling at Visund at the time. “We are planning for the rig to be in operation again after the turn of the year. (…)”, said Statoil’s Tore Aarreberg, rig procurement responsible . COSL Pioneer, contracted until 2016 with Statoil at 320 000 USD/day* temporarily suspended (September 2014) Statoil stated in a press release September 17th: “Due to overcapacity in our rig portfolio, Statoil will lay up the COSL Pioneer rig in the fourth quarter of 2014.” “After a careful review of our drilling plan, we find it necessary to suspend COSL Pioneer for the time being,” says rig procurement responsible Tore Aarreberg.
Key segments affected Rig and drilling contractors, Well services and Drilling tools and commodities
Rystad Energy take away and expected market impact
Statoil reports that the change “(…) will have no impact on Statoil’s production targets or planned exploration activity on the NCS We see a reduced rig demand in 2015 compared to 2014, primarily driven by lower willingness to explore, but also certain field-developments and infill drilling campaigns being pushed to the right. Current outlooks call for activity to pick up again into 2016 and beyond. However, the massive influx of rigs that the NCS have seen past years, and will see coming years (confirmed Songa and Maersk rigs with possible additions of speculative newbuilds such as North Sea Rigs, Stena, etc.) creates an oversupplied situation that will last for several years. 2014-levels in the Rig and drilling contractors segment is down by 4% compared to Q2, and 2020 levels are down by 14%. Well services and Drilling tools and commodities are both adjusted down with 1% in 2014, and 13% in 2020.
Offshore Market Report Norway 13
Operational and Professional Services revenue 2013, split by segment level 2 (1/7)
Note: 2012 figures where 2013 figures not availableSource: Company information, public sources, Rystad Energy research
1
RevenueNOK million
Government and Organizations ISS Operational Services
Professional Services
Support Services
Share of main segment
Other Oil and Gas in Norway Other Revenue Grand Total
- 2 222 - - - 8,4 % 188 1 489 3 899- 1 718 - - - 6,5 % 166 43 1 927
- - - 1 182 62 4,7 % - 13 990 15 234 - - - - 981 3,7 % - 109 1 090
- 949 - - - 3,6 % 282 - 1 231 - - - - 829 3,1 % - 32 861 - - - - 680 2,6 % - - 680
- - - 664 - 2,5 % 226 868 1 758 - - - - 630 2,4 % - - 630
- - - - 560 2,1 % 2 590 - 3 150- - 478 - - 1,8 % - 1 082 1 560
- - - 461 - 1,7 % 143 196 800 - 46 29 368 - 1,7 % 2 442 682 3 567
- - - 402 28 1,6 % 443 290 1 163- - - 390 - 1,5 % 1 169 - 1 559
- - - - 382 1,4 % - - 382 - - - 360 - 1,4 % 242 - 601
- 339 - - - 1,3 % 365 18 723 - - 331 - - 1,2 % - - 331
- 300 - - - 1,1 % - 17 317 - - - 292 - 1,1 % - - 292
- - - 282 - 1,1 % 13 146 441 - - - 277 - 1,0 % - 206 483
- - - - 266 1,0 % - 621 886 - 256 - - - 1,0 % - 85 341
- - - 254 - 1,0 % 117 6 377- 246 - - - 0,9 % - 12 075 12 321- - - 233 - 0,9 % 189 537 959- - - 214 - 0,8 % 28 90 331- - - 210 - 0,8 % - 103 313
- 209 - - - 0,8 % - 52 261- - - 202 - 0,8 % 122 157 481
Operational and Professional Services revenue 2013, split by segment level 2 (1/7)
Note: 2012 figures where 2013 figures not availableSource: Company information, public sources, Rystad Energy research
1
RevenueNOK million
Government and Organizations ISS Operational Services
Professional Services
Support Services
Share of main segment
Other Oil and Gas in Norway Other Revenue Grand Total
- 2 222 - - - 8,4 % 188 1 489 3 899- 1 718 - - - 6,5 % 166 43 1 927
- - - 1 182 62 4,7 % - 13 990 15 234 - - - - 981 3,7 % - 109 1 090
- 949 - - - 3,6 % 282 - 1 231 - - - - 829 3,1 % - 32 861 - - - - 680 2,6 % - - 680
- - - 664 - 2,5 % 226 868 1 758 - - - - 630 2,4 % - - 630
- - - - 560 2,1 % 2 590 - 3 150- - 478 - - 1,8 % - 1 082 1 560
- - - 461 - 1,7 % 143 196 800 - 46 29 368 - 1,7 % 2 442 682 3 567
- - - 402 28 1,6 % 443 290 1 163- - - 390 - 1,5 % 1 169 - 1 559
- - - - 382 1,4 % - - 382 - - - 360 - 1,4 % 242 - 601
- 339 - - - 1,3 % 365 18 723 - - 331 - - 1,2 % - - 331
- 300 - - - 1,1 % - 17 317 - - - 292 - 1,1 % - - 292
- - - 282 - 1,1 % 13 146 441 - - - 277 - 1,0 % - 206 483
- - - - 266 1,0 % - 621 886 - 256 - - - 1,0 % - 85 341
- - - 254 - 1,0 % 117 6 377- 246 - - - 0,9 % - 12 075 12 321- - - 233 - 0,9 % 189 537 959- - - 214 - 0,8 % 28 90 331- - - 210 - 0,8 % - 103 313
- 209 - - - 0,8 % - 52 261- - - 202 - 0,8 % 122 157 481
Operational and Professional Services revenue 2013, split by segment level 2 (1/7)
Note: 2012 figures where 2013 figures not availableSource: Company information, public sources, Rystad Energy research
1
RevenueNOK million
Government and Organizations ISS Operational Services
Professional Services
Support Services
Share of main segment
Other Oil and Gas in Norway Other Revenue Grand Total
- 2 222 - - - 8,4 % 188 1 489 3 899- 1 718 - - - 6,5 % 166 43 1 927
- - - 1 182 62 4,7 % - 13 990 15 234 - - - - 981 3,7 % - 109 1 090
- 949 - - - 3,6 % 282 - 1 231 - - - - 829 3,1 % - 32 861 - - - - 680 2,6 % - - 680
- - - 664 - 2,5 % 226 868 1 758 - - - - 630 2,4 % - - 630
- - - - 560 2,1 % 2 590 - 3 150- - 478 - - 1,8 % - 1 082 1 560
- - - 461 - 1,7 % 143 196 800 - 46 29 368 - 1,7 % 2 442 682 3 567
- - - 402 28 1,6 % 443 290 1 163- - - 390 - 1,5 % 1 169 - 1 559
- - - - 382 1,4 % - - 382 - - - 360 - 1,4 % 242 - 601
- 339 - - - 1,3 % 365 18 723 - - 331 - - 1,2 % - - 331
- 300 - - - 1,1 % - 17 317 - - - 292 - 1,1 % - - 292
- - - 282 - 1,1 % 13 146 441 - - - 277 - 1,0 % - 206 483
- - - - 266 1,0 % - 621 886 - 256 - - - 1,0 % - 85 341
- - - 254 - 1,0 % 117 6 377- 246 - - - 0,9 % - 12 075 12 321- - - 233 - 0,9 % 189 537 959- - - 214 - 0,8 % 28 90 331- - - 210 - 0,8 % - 103 313
- 209 - - - 0,8 % - 52 261- - - 202 - 0,8 % 122 157 481
Operational and Professional Services revenue 2013, split by segment level 2 (1/7)
Note: 2012 figures where 2013 figures not availableSource: Company information, public sources, Rystad Energy research
1
RevenueNOK million
Government and Organizations ISS Operational Services
Professional Services
Support Services
Share of main segment
Other Oil and Gas in Norway Other Revenue Grand Total
- 2 222 - - - 8,4 % 188 1 489 3 899- 1 718 - - - 6,5 % 166 43 1 927
- - - 1 182 62 4,7 % - 13 990 15 234 - - - - 981 3,7 % - 109 1 090
- 949 - - - 3,6 % 282 - 1 231 - - - - 829 3,1 % - 32 861 - - - - 680 2,6 % - - 680
- - - 664 - 2,5 % 226 868 1 758 - - - - 630 2,4 % - - 630
- - - - 560 2,1 % 2 590 - 3 150- - 478 - - 1,8 % - 1 082 1 560
- - - 461 - 1,7 % 143 196 800 - 46 29 368 - 1,7 % 2 442 682 3 567
- - - 402 28 1,6 % 443 290 1 163- - - 390 - 1,5 % 1 169 - 1 559
- - - - 382 1,4 % - - 382 - - - 360 - 1,4 % 242 - 601
- 339 - - - 1,3 % 365 18 723 - - 331 - - 1,2 % - - 331
- 300 - - - 1,1 % - 17 317 - - - 292 - 1,1 % - - 292
- - - 282 - 1,1 % 13 146 441 - - - 277 - 1,0 % - 206 483
- - - - 266 1,0 % - 621 886 - 256 - - - 1,0 % - 85 341
- - - 254 - 1,0 % 117 6 377- 246 - - - 0,9 % - 12 075 12 321- - - 233 - 0,9 % 189 537 959- - - 214 - 0,8 % 28 90 331- - - 210 - 0,8 % - 103 313
- 209 - - - 0,8 % - 52 261- - - 202 - 0,8 % 122 157 481
Offshore Market Report Norway
Property of Rystad Energy
NCS Maintenance Services – Overview
68
Total revenue 201338 BNOK
59%41%
Oil companies(direct supplier)
Oil service(sub-supplier)
Distribution of customer types
Total number of active players256
Top 3 players (by revenue 2013)AibelAker SolutionsWestcon
Key market drivers
Age of platforms: Increasing age of platform on the NCS increase the need for maintenance services. Several of the platforms currently in operations are beyond their original estimated life time, and continuous maintenance and upgrades are needed to maintain the integrity. 0
10
20
30
2005 2010 2015 2020 2025
Selected contract awards since last release
Contract scope Supplier Buyer Deal value (MNOK)
SPS for Borgland Dolphin to be executed Q4 2014 Bergen Gr./Semco M. Dolphin Drilling 350
MMO FA, Valemon; Q2 2014-July 2016 + 2*2 option Apply Sørco Statoil 180
Valve main. Draugen/Nyhamna, -2019 + 2*2 option Oss-nor Shell 160
Average age of platforms on the NCSYears
Selected transactions since last release
Transaction summary Seller Buyer Deal value (MNOK)
AMOF and Fjell Technology to Merge Fjell Technology AS AMOF AS
Important changes since last release
• 2014 estimates have been adjusted down with 2.4%, and estimates for 2015 down by 10% due to the cutbacks across several segments and layoffs within MMO players due to low expected activity in the short term. Forecast is adjusted accordingly, however with 2019 and 2020 levels only 1-2% below the forecast in Q2.
Chapter 3-13: Segment by segment overview
Introduction to segment with key drivers and recent contract awards and company transactions
Player overview: Graphical and tabled of 2010 revenue for all active players in segment Ideal for company screening (acquisition), competitor analysis, analyzing market shares, etc.
Company deep dives on segment level 3 revenue for selected chapters
Historic development and forecast by level 2
Offshore Market Report Norway
Property of Rystad Energy
NCS Maintenance Services, historic development
Source: Industry interviews; Rystad Energy research and analysis; Company information
69
Maintenance Services by segment level 2NOK million
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1985 1988 1991 1994 1997 2000 2003 2006 2009 2012
Ship and Rig Repair
Metal, pipes and valves
Inspection and Maintenance
Automation and ElectroMaintenance
Deep dive on most recent years by level 3
Offshore Market Report Norway
Property of Rystad Energy
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Inspection and Maintenance Metal, pipes and valves Ship and Rig Repair Automation and Electro Maintenance
Instruments and Measurement Maintenance
Electro and Power System Maintenance
Control Room, Tele and IO Maintenance
Ship and Rig Repair
Piping Steel
Valve Services
Valves
Machining and coating
Onshore maintenance
Offshore maintenance
Inspection
MMO frame agreements
NCS Maintenance Services, historic development by segment level 2 and 3
Source: Industry interviews; Rystad Energy research and analysis; Company information
73
Maintenance Services, split by level 2 and 3NOK million nominal
Offshore Market Report Norway
Property of Rystad Energy
* Only companies where 2013 revenue is availableSource: Company information, public sources, Rystad Energy research
77
0 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 5 000
Aibel Aker Solutions
Westcon Fabricom
IKM Gruppen Bergen Group
ABB Agility Group MRC Global
Apply Sverdrup Hanssen Spesialstål
Reinertsen Mento
Petrolvalves Kongsberg Gruppen
Oceaneering Linjebygg
GMC Group Bandak Group
Valco Group SFF group
Siemens SAR
Karsten Moholt Proserv
Albatross Services Aarbakke Group
Norwegian Piping TDW Offshore Services
Invensys PLC Vinje Industri
Nymo Bilfinger
WIS Gruppen Oss-Nor
CAN Semco Maritime
Fluid Control Multi Industrier
On & Offshore Holding Axess
Sønnico Storesund Marine
Eurotechnology BR Industrier
Euro Offshore Freudenberg Oil & Gas
AAK Honeywell Norge
Wepco
Automation and Electro Maintenance
Inspection and Maintenance
Metal, pipes and valves
Ship and Rig Repair
NCS Maintenance Services Revenue 2013 split by level 2NOK million
Change in revenue from 2012 to 2013*Percentage growth-30% -10% 10% 30% 50% 70%
Aibel Aker Solutions
Westcon Fabricom
IKM Gruppen Bergen Group
ABB Agility Group MRC Global
Apply Sverdrup Hanssen Spesialstål
Reinertsen Mento
Petrolvalves Kongsberg Gruppen
Oceaneering Linjebygg
GMC Group Bandak Group
Valco Group SFF group
Siemens SAR
Karsten Moholt Proserv
Albatross Services Aarbakke Group
Norwegian Piping TDW Offshore Services
Invensys PLC Vinje Industri
Nymo Bilfinger
WIS Gruppen Oss-Nor
CAN Semco Maritime
Fluid Control Multi Industrier
On & Offshore Holding Axess
Sønnico Storesund Marine
Eurotechnology BR Industrier
Euro Offshore Freudenberg Oil & Gas
AAK Honeywell Norge
Wepco
NCS Maintenance Services Revenue 2013 – top 50 players
2012 Figures
Offshore Market Report Norway
Property of Rystad Energy
NCS Maintenance Services Revenue 2013 – all players
Source: Company information, public sources, Rystad Energy research
79
NCS Maintenance Services Revenue 2013 split by level 2 (Note: Different axes)NOK million
0 500 1 000 1 500 Aibel
Aker Solutions Westcon
Fabricom IKM Gruppen
Bergen Group ABB
Agility Group MRC Global
ApplySverdrup Hanssen …
Reinertsen Mento
Petrolvalves Kongsberg Gruppen
Oceaneering Linjebygg
GMC Group Bandak Group
Valco Group SFF group
Siemens SAR
Karsten Moholt Proserv
Albatross Services Aarbakke Group
Norwegian Piping TDW Offshore Services
Invensys PLC Vinje Industri
Nymo Bilfinger
WIS Gruppen Oss-Nor
CAN Semco Maritime
Fluid Control Multi Industrier
On & Offshore Holding Axess
Sønnico Storesund Marine
Eurotechnology BR Industrier
Euro Offshore Freudenberg Oil & Gas
AAK Honeywell Norge
Wepco
0 10 20 30 40 50 MBO
Unimek Teco Maritime Group
SGS Halvorsen
Applus Addtech Wärtsilä Promet
Acel Uvdal Maskinfabrikk
Prosessmetall Inspecta
Jansen og Willums… Ågotnes Sveis
Hymek Benor
Heinsa Mekaniske Certex Norge
Maritim Service Vest ventil
FLEKKEFJORD ELEKTRO JB Maskinering
Simplicity Ulmatec Nemko Rotork Simex
Noske Ventiler Bagges
Fjelde Mek Verksted Niras
Scandcon AS Regulator
OSWO Fmv
Well Innovation Tubedrill
OneSubsea Reins Maskinering
HTS Maskinteknikk Samson
West Elektro Tronrud Engineering
Sotra Contracting Teknisk Produksjon
Thune Produkter AS Delprodukt
Align
0 50 100 150 AGR
Langset PSW Group
Helgeland V&M Brattvåg Elektro
EagleBurgmann Norway NTOS
IK Stavanger Cameron Norge
North Well Gefro Rolf Lycke
Hermes Marine Service Voith
Delta Group Tratec
Flow Control Norway J S Cock
Haakon EllingsenEmerson Process M…
NLIKristiansands Skr… Slåttland Mek Ind…
GMV Score
Malm Orstad Scana Industrier
Rightech ConsultingFORCE Technology …
Petroleum Technol… Otic
Kværner Intermec
Sub Sea Services Furmanite
Stamas Gruppen Radøygruppen
Anlegg og Marine … Westcontrol
Maskinering Og Sv… Mikromekanikk
Kitron Fosstech
Pipetech Internat… Solid Offshore
K Lerøy Metallind… Quickflange
Stryvo Parker Hannifin
Ktn Rush Maskinering
0 5 10 15
Cosalt OffshoreMekanisk Service …
Goodtech Proweld
HS-Maskin Forus Elektro
ElmoMjøs Metallvarefa…
Os Maskinering Jæren Maskinering
TeamUp Automasjon TechPart Ekstrand
Tri tool Norge Metso
Ultra-Technology BEL Valves Norway
Grenland Mekaniske Norner
VTT maritimeHitec Products Dr…
Berget Mandal Maskinering
Levo Watech
Yokogawa Norge Norwegian Valve Group
Aasen Dreierverksted Miras
Axflow Jergo
T Bruvik Dameco
Raufoss Offshore Semek
Ship and Rig RepairMetal, Pipes and ValvesInspection and Maint.Automation and El. Maint
2012 Figures
Offshore Market Report Norway
Property of Rystad Energy
NCS Metal, pipes and valves Revenue 2013 – all players
Source: Company information, public sources, Rystad Energy research
88
NCS Metal, pipes and valves Revenue 2013 split by level 3 (Note: Different axes)NOK million
0 100 200 300 400 500 600 700 800
MRC Global Sverdrup Hanssen Spesialstål
Mento Petrolvalves
IKM Gruppen Bandak Group
Valco Group SFF group
Proserv Aarbakke Group
Norwegian Piping WIS Gruppen
Oss-Nor Euro Offshore
Freudenberg Oil & Gas Wepco
Langset Fluid Control
EagleBurgmann Norway IK Stavanger
Cameron Norge Metso
North Well Gefro Rolf Lycke
Hermes Marine Service BR Industrier
Flow Control Norway J S Cock
Haakon Ellingsen Slåttland Mek Industri
Vinje Industri GMV
Score Malm Orstad
Petroleum Technology Company Kværner
NLI Intermec
Stamas Gruppen Kongsberg Gruppen
Westcontrol Maskinering Og Sveiseservice
Mikromekanikk Fosstech
K Lerøy Metallindustri Stryvo
Parker Hannifin Rush Maskinering
Oceaneering Unimek
Valves
Valve Services
Piping Steel
Machining and coating
0 10 20 30 40
Promet Scana Industrier
Uvdal Maskinfabrikk Prosessmetall
Heinsa Mekaniske Maritim Service
Vest ventil JB Maskinering
Simplicity Ulmatec
Noske Ventiler Bagges
Aker Solutions Fjelde Mek Verksted
Niras Rotork
AS Regulator OSWO
Fmv Well Innovation
Tubedrill Furmanite
Reins Maskinering HTS Maskinteknikk
Samson Tronrud Engineering
Sotra Contracting Teknisk Produksjon
Anlegg og Marine Service Thune Produkter
AS Delprodukt Mekanisk Service Halden
Halvorsen Ågotnes Sveis
Proweld HS-Maskin
Mjøs Metallvarefabrikk Os Maskinering
Jæren Maskinering TechPart Ekstrand
Tri tool Norge Ultra-Technology
BEL Valves Norway Grenland Mekaniske
Berget Mandal Maskinering
Lilaas Levo
Watech Norwegian Valve Group
2012 Figures
0 1 2 3 4
Aasen Dreierverksted Miras
Hymek Jergo
Dameco Raufoss Offshore
Ekro Semek
Cody Fjell Industries
Torgy Mek. Industri
Offshore Market Report Norway
Property of Rystad Energy
0 1 000 2 000 Bilfinger
Beerenberg DNV GL
ESS Support Services Kaefer Energy
Sodexo Remote Sit… Master Marine
BOA Group Prosafe Offshore
COSL Drilling Telenor
Add Energy Group IKM Gruppen
Acona Omega
Norsk Offshore Ca… Ross Offshore
LinjebyggTeekay Petrojarl …
StS gruppen Falck Nutec
Axess OSM Group
G4S Secure Solutions Norisol Norge
Petrolink Jotun Sintef
Fosdalen IRIS
NSE Industry Langset
TS Group Harris Corp
Lloyd's Register Global Maritime
Norges Geoteknisk… Safetec Nordic
IFE Vinje Industri
Norconsult FMC Technologies
Norsea Group Solid Vedlikehold
Proactima AGR
Data Respons Intertek
Stillasgruppen
NCS Operational and Professional Services Revenue 2013 – top 200 players
Source: Company information, public sources, Rystad Energy research
101
NCS Operational and Professional Services Revenue 2013 split by level 2 (Note: Different axes)NOK million
0 5 10 15 20 Applus
IBM VEX-gruppen
Kunnskapsparken Nord ADB
KTV groupONS offshore Nort…
Senergy Tel-Tek
ITCKunnskapsparken H…
SafemarAalesund Oljekled… Offshore Simulato…
Front Group VisSim
Oil Infomation Idevekst Energi ODS-Petrodata
Aluhak Stillas Spesial Produkter Sør
Grip Maling Korro… Intelecom Promineo
Facilium Ceragon Networks
Real marine FIMAMEC Aquateam
RealGroup Norwater
EpsisBentley Systems S…
Petromedia C. Christoffersen
Ocean Riser SystemsScandinavian Oil-…
Nordan Consult Soludyne
Weldindustry Jotne Group
Haugaland HMS Aker Solutions
iSurveyAdvokatfirma DLA …
Thor Dahl BemanningsbyråetOljeindustriens K…
Fred. Olsen Produ…
0 50 100 150 CGI
HANSEN PROTECTION Bjellcon
Cerno HoldingFORCE Technology …
Engineering Consu… HERNIS Scan Systems
Centerpoint Software Innovation
Manpower IFS
JJS Prosjektpartner Tampnett
Marine Cybernetics Ressurspartner
Accpron Wikborg, Rein & CoAstrium Services …
Techconsult Hytech Personell
Hoover Container … Marine Installasjon
Xervon Seabrokers
Statech Offshore Media Group
Well Partner On & Offshore Holding
PSW Group SAP
Ship Modelling & … Servicegrossistene
Sharecat Karmsund Maritime
Industri MekanikkTrelleborg Offsho…
Westcon Bestra
Emerson Process M… Aveva
Hillevåg elektro … NetApp Corp
Herøya Industripark Unitech Power Systems
Resq NITO
Carboline Conventor
Båtservice Contra… Nosefo
0 10 20 30 40 50 60 Vrs Installasjon
NOTECHHitec Products Dr…
Gard Orange Offshore
Verdande Technology Marin Teknikk
Odda Plast Møre Teknikk
MirasChristian Michels…
Schlumberger Mudenia Elektro
Pbs Intergraph Norge
INTSOK Rignet
MIDT NORSK STILLAS Lie Overflate Teknikk
NUIAdvokatfirmaet Se…
ExproSoft BR Industrier
GIEK Drager Safety Norge
ApplyInventas Produktd…
Skipsteknisk Logiteam
Slagen GruppenNorsk Gjenvinning…
3M Norge Pöyry Align
ASK Safety Baze Technology
Akzo Nobel Xait
Noreq Trac-ID Systems
StormgeoOilfield Technolo…
Teknologisk InstituttStord Offshore Co… Inmarsat Solutions
Geogroup Norkem
KongshavnSimonsen Advokatf… Norges Maritime U…
Support ServicesProfessional ServicesOperational ServicesISOGovernmental and Organizations
2012 Figures
Tabled view
Graphical view
Offshore Market Report Norway 14
Chapter 14 – platform by platform overview – Example: Southern North Sea, Valhall
Valhall Field Information
Platform FactsValhall PH (started production Jan 2013)Steel platform; Process and hotel (180); Installed 2012; Start-up: Jan 2013; Capacity: 120 kbbl/d; Topside weight: 11,85 kt; Base: Kværner; Deck: Heerema; Installation: Saipem; W. depth: 69mValhall PCPSteel platform; Process; Installed Dec 1981; Start-up: Oct 1982; Capacity: 168 kbbl/d; Topside weight: 13 kt; Base: McDermott; Deck: Aker Stord/Kvaerner Brug/Vigor; Installation: Heerema; W. depth: 69 mValhall WPWellhead Platform; Process; Installed May 1996; Start-up: May 1996; Capacity: 40 kbbl/d; Topside weight: 2 kt; Base: Heerema; Deck: Heerema; Installation: Heerema; W. depth: 69 mValhall IPSteel platform; Drilling; Installed Aug 2003; Start-up: Jan 2004; Topside weight: 10 kt; Base: Aker Verdal; Deck: Aker Stord; Installation: Saipem; W. depth: 69 mValhall DPSteel platform; Drilling; Installed Jan 1981; Start-up: Oct 1982; Topside weight: 7 kt; Base: Aker Verdal; Deck: Aker Verdal; Installation: McDermott/Heerema; W. depth: 69 mValhall QPSteel platform; Hotel(209); Installed Apr 1980; Start-up: Oct 1982; Topside weight: 3 kt; Base: Aker Stord; Deck: UIE/Sterkoder/Vigor; Installation: McDermott; W. depth: 69 mValhall Flanke NordWellhead Platform; Installed Jul 2003; Start-up: Jan 2004; Topside weight: 2 kt; Base: Heerema; Deck: Heerema; Installation: Heerema; W. depth: 69 mValhall Flanke SørWellhead Platform; Installed May 2003; Start-up: Fall 2003; Topside weight: 2 kt; Base: Heerema; Deck: Heerema; Installation: Heerema; W. depth: 69 m
Recent modification projectsAll Platforms• New subsea pipeline systems 2008• Late life redevelopment - new production and
accom. platform 2010-ongoing, Aker Solutions (NOK 450 mill)
• Water Handling, PorPure and NLI, 2010• HVAC, Apply Oil & Gas, 2011• Life of Field Seismic system – LoFS, Technip (NOK
50 mill)• Office modules, HB Rentals, 2010/11 (NOK 5 mill)• Gas lift modules at Valhall Flanke Nord and Valhall
Flanke Sør. New modules at Valhall WP (2009-2011) including Riser/ESDV facility.
• Electrification from shore from 2011
Recent redevelopment projects• Valhall PH (production and hotel) platform started
production January 2013. Part of Valhall redevelopment program with total development cost of BNOK 49,6 (+98,2% compared to original PDO estimate)
Upcoming modification projectsAll Platforms• Gas lift modules at Valhall Flanke Nord and Valhall
Flanke Sør. New modules at Valhall WP (2009-2011) including Riser/ESDV facility.
• Longer term, need wave protection/prolonge legs due to subsidence
• Modifications related to decommissioning and shut-down of old platforms
• Candidate for drilling facility upgrade• Candidate for gas treatment upgrade• Pumps, Eureka Pumps (Align), frame agreement with
BP for three years
Upcoming redevelopment projectsAll Platforms• PCP, QP and DP platforms decommissioned by 2020• "The Greater Valhall Programme" - possibly two new
platforms, drilling of 20 to 30 wells, 43 BNOK investments, includes investments at Ula
– New Wellhead Platform at Valhall: cancelled 2014– New process and living quarter platform at Valhall
(Valhall PH)– New platform at Hod: Cancelled 2014– Upgrades at Ula
• Maersk Reacher drilling contract renewed for drilling untill Q3 2016. In addition, new Jack-up ordered by Maersk for Valhall from Daewoo Shipbuilding and Marine Engineering. Delivery 2016, value 3,8 BNOK.
Source: NPD; Company information; Rystad Energy research and analysis; Industry sources
1
Operator BPSupport org. StavangerMMO FA Aker SolutionsISO FA Bilfinger IndustrierOther FA Safety and autmation systems: ABBDrilling op. ArcherWells since 2005 42
2008 2009 2010 2011 2012
Total OPEX 1015 1063 961 1505 2036Total CAPEX 6445 7781 7063 4866 6170
Offshore Market Report Norway
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