Right now, we’re looking at a 70%-30% spread for total global onshore and offshore oil and gas production, respectively. Of that 30% of offshore production, subsea oil and gas production represents 9%. That is about to change as E&P companies go deeper and deeper, taking advantage of new technology that can handle higher pressure and higher temperatures to ward off declining production.
Subsea production systems are wells located on the sea floor rather than the surface. Petroleum is extracted at the seafloor, and then 'tied-back' to an already existing production platform. The well is drilled by a moveable rig and the extracted oil and gas is transported by riser or undersea pipeline to a nearby production platform. Subsea systems are typically in use at depths of 7,000 feet or more, and do not have the ability to drill, only to extract and transport.
The real advantage of subsea production systems is that they allow you to use one platform—strategically placed—to service many well areas. And as the cost of offshore production rises, this could represent significant savings.
Subsea production could rival traditional offshore production in less than 15-20 years, and we’re looking at expected market growth for subsea facilities of around $27 billion in 2011 to an amazing $130 billion in 2020.
Subsea capital expenditure is set to grow at 14.8% to 2017, according to Infield Systems, and driving this growth is…