According to Rystad Energy, an independent energy research and business intelligence company based in Norway, overall offshore project sanctioning in 2019 has surpassed the $50 billion mark. It was driven by Saudi Aramco’s recently announced $18 billion worth of project commitments associated with the Marjan and Berri expansion projects. This is yet another signal that the offshore industry has turned a corner and can reach a potential project commitment total of $123 billion in 2019, surpassing commitments in 2014 of $78 billion, according to Rystad Energy.
The Marjan Expansion alone is the largest field to be sanctioned globally since 2014. Later this year, the Hail and Ghasha Sour Gas projects, Lula’s Oeste FPSO in Brazil, and the feed gas systems to develop the Atum and Golfinho assets on the Area 1 LNG project are also expected to be sanctioned. Once that happens, four of the top 10 offshore projects since 2014 will have been sanctioned during this calendar year. Previously, the $4.7 billion Liza Phase 2 project was the largest offshore field to be sanctioned this year.
“With offshore free cash flows at nearly record highs, E&P’s are betting big on new projects. Offshore project sanctioning in 2019 looks ready to reach heights not seen since the $100 barrel of oil,” says Matthew Fitzsimmons, VP of Oilfield Service Research at Rystad Energy.
(Source: Rystad Energy)