Global spending on deep-water wells will surge to $114 billion by 2022, compared to $43 billion last year, creating a critical need for offshore rig workers, according to a new analysis by Wood Mackenzie.
Deep-water markets are expanding rapidly, the research and consulting firm notes, projecting a 150 percent jump in the number of exploration, appraisal and development wells drilled by 2020. It also projects expansion of Arctic drilling by the end of the decade, though Arctic wells will remain a fraction of all wells drilled — just three percent through 2022.
“To meet the forecasted well demand, the fleet will require 95 additional deep-water rigs to be constructed between 2016 and 2022, representing $65 billion of investment,” Malcolm Forbes-Cable, senior management consultant at Wood Mackenzie and author of the study, in a written statement. “This will require the longest period of deep-water rig construction to date, representing a change for the deep-water sector from cyclical to sustained growth.”
The Future of Global Deepwater Markets report projects rig contractors will need to expand their payrolls by 37,000 workers over the next decade to meet demand for rigs. That’s an impossible target to meet under the current rate of recruitment, Wood Mackenzie says.
The analysis notes that deep-water projects have become central to growth plans for many international oil companies, but that creates challenges for budget constraints, risk management and human resources.
“Deepwater has accounted for most of the discovered volumes during this time, but this has not been without increasing technical and commercial challenges,” said Malcolm Forbes-Cable, Senior Management Consultant at Wood Mackenzie and author of the study.
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