According to an analysis by Westwood Global Energy group, a rebound is expected next year allowing the signing of dozens of EPC contracts for a total value of $45 billion. A specialist consultant from the company announced that offshore EPC contracts worth $6bn are expected to be signed in the fourth quarter of this year, bringing the total amount awarded this year to $17bn. A rebound in the sector next year is expected to see 72 final investment decisions materialise for an EPC contract value of between $44 and $45 billion.
Thom Payne, Westwood’s head of offshore energy services, says a significant number of LNG projects are expected to come on stream in 2021. According to him, offshore EPC contracts will be worth $45bn in 2022, then $55bn in 2023, dropping to nearly $4bn in 2024. NOC (National Oil Companies), including Qatar Petroleum and Saudi Aramco, will be responsible for this rebound through their respective upcoming mega-projects. Moreover, these NOCs are expected to own only 16% of the value of the contracts for 2021, including Shell and Woodside among the top 10 global buyers.
The net debts of the big five international oil companies (BP, Shell, Exxonmobil, Chevron and Total) have increased by $48.6 billion this year as they have failed to cover their expenses and will therefore reduce their investments for 2021, as BP and Total have already done for example.
Positive notes are yet to come thanks to most of the operators who will normally make final investment decisions on several offshore projects including Tolmount E (Premier oil) in the British North Sea, the Umm Shaif (Adnoc) project in Abu Dabi and the Bacalhau (Equinor) project off the coast of Brazil.
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by Nicolas Boudou