This article focuses on global pipeline projects, including how the state of the oil and gas sector will drive future activity and potential areas for growth.
Recently we at Mirage took a quick look at the World Oil and Gas Review produced by energy company Eni, which provides an in-depth analysis of the statistics from 2015. Some notable highlights include:
- World oil production saw the biggest increase in the past 10 years — up 2.2 percent.
- The U.S. overtook Saudi Arabia and Russia with record growth of 15.4 percent.
- The growth in global oil demand halved to 0.7 percent.
- Global refining capacity grew by 4 million bpd, with Asia contributing 3 million bpd.
- European refining capacity curbed due to foreign competition and falling domestic demand.
- Gas production increase was led by the U.S. due to shale gas resources.
- Gas consumption saw an overall decrease of 0.4 percent. Europe and Russia saw falls, but the U.S., Middle East and Asia saw increases.
Outlook for pipeline projects
As you might expect, the state of the oil and gas sector as described above has a huge impact upon pipeline construction projects. In September 2015, Audrey Leon from www.oedigital.com spoke with Infield Systems’ analysts James Hall and Wei Liu to get their assessment of what the future may hold. Below is a snapshot of their views.
The offshore pipeline installation market over the next 12 months will be “challenging.” Infield has downgraded its three-year forecast for pipeline installation capex by approximately 25 percent, and spending for the period is now anticipated to be about 10-percent lower than in the 2012-14 period.
North America is likely to see pipe-laying demand shrink in the coming years, as shallow water activity in the Gulf of Mexico has been negatively affected by the onshore shale boom.
European pipe-laying activity in 2015-17 will be moderate, with an annual installation of 1,200 kilometers (a 50-percent drop from forecasts a year ago).
Hall and Liu also suggested countries driving pipe-laying demand growth may include Africa, but with the risk that continued low oil prices may end up delaying large-scale projects in Angola, Egypt and Nigeria.
Moderate growth is expected in Latin America, and by the end of the decade, Australasia demand will be driven by expansion of the Darwin LNG projects.
Some recovery will be felt in the second half of 2017, although the pipe-laying fleet will experience a six-12 month lag.
Outlook for project engineers
As you might expect, what the future holds really depends upon where you’re located or which countries you want to operate in. Accurate predictions are difficult in such volatile times, but what is clear is the emphasis in Europe has shifted away from construction toward decommissioning.
If construction is your area of expertise, then Africa, Latin America and Australia show more promise for project opportunities.
The difficult economic climate and the maturity of installations are making many companies look toward extending the lifetime of their assets.
This is good news for those looking to work on maintenance projects. In places such as the Arabian Gulf, where the extreme environment includes high humidity, temperatures 20 degrees above global average and salinity levels higher than anywhere else in the world, facility owners are said to be looking for a service life beyond original design.
In the U.S., many offshore pipelines are more than 40 years old. One incident illustrating the importance of maintaining pipeline integrity is the onshore Plains All American pipeline, which leaked more than 100,000 gallons of heavy crude oil onto the California coast. Working on such maintenance demands project engineers use robust and reliable equipment that performs efficiently and quickly.
For more information, visit www.miragesubsea.com or call (281) 859-1234.
