Offshore Support Vessel: Global Market Analysis

(Image Courtesy: Offshore Energy Today)

Offshore vessels are ships that specifically serve operational purposes such as oil exploration and construction work on the high seas. There are a variety of offshore vessels, which not only help in exploration and drilling of oil but also for providing necessary supplies to the excavation and construction units located at the high seas.

Leading Players in OSV Market

Some of the leading players in the offshore support vessel market, on the basis of their recent developments and other strategic industrial activities, are Bourbon (France), Seacor Marine (US), Swire Group (Hong Kong), Tidewater (US), Gulfmark Offshore, Inc. (US), Havila Shipping (Norway), Hornbeck Offshore Services (US), The Maersk (Denmark), and Siem Offshore (Norway), among others.

These players have adopted growth strategies such as new product launches, contracts and agreements, partnerships, collaborations, alliances, and joint ventures, mergers & acquisitions, and investments and expansions to capture a larger share of the offshore support vessel market.

Market Predictions for OSVs

The Asia Pacific market led the offshore support vessel market, with the largest market share, by value, in 2018, and the trend is projected to continue until 2023. The market in Europe will also play an important role in driving demand for offshore support vessels.

North America is a fast-growing market for offshore support vessels during the forecast period. This growth is due to the increasing focus on offshore robust investments in the offshore oil and gas sector. And growing offshore exploration activities, combined with the growth in offshore wind farms and in order to replace production from mature onshore fields.

Current Scenario

The global offshore support vessel market was valued at USD 19.21 Billion in 2017; it is projected to reach USD 25.66 Billion by 2023, growing at a CAGR of 5.04%, from 2018 to 2023. Deepwater production and exploration activities in Europe and the Middle East would boost the growth of the offshore support vessel market.

The growth in the deployment of offshore wind farms in countries such as China and the US would drive the offshore support vessel, for installation, maintenance, and during the replacement of offshore wind turbines. The cost of renting offshore supply vessels (OSVs), servicing oil and gas firms, will continue to rise as many ships that were mothballed up during the downturn will not return to the market, the CEO of Norway’s DOF had said recently.

Market Dynamics

Drivers – Investments in Offshore Oil & Gas and Renewable Sectors

Restraints – Capital-Intensive Market and Oversupply of Offshore Vessels

Opportunities – Aging of Offshore Infrastructure Leading to Replacement and Decommissions, Increased Exploration Activities in Ultra-Deep Water and Artic Region

Challenges – High Operational Risks and Governmental Regulations for Offshore Activities in Key Regions

(Image Courtesy: Wartsila)

Types of OSVs:

  1. Anchor-handling tug supply vessels
  2. Platform supply vessels
  3. Multipurpose supply vessels
  4. Emergency response/standby and rescue vessels
  5. Crew vessels
  6. Chase vessels
  7. Seismic vessels

Supportive Trends

A number of offshore vessel companies went bankrupt after oil prices plunged between 2014 and 2016 or were forced to merge with competitors to survive as oil companies cut spending for exploration and new developments. But the rates for hiring specialised vessels, which include platform supply, diving support (DSV) and anchor-handling vessels, have increased in the last year. While the North Sea has been leading the increase in demand for OSVs, with rates for some vessel segments improving by 30% from a year ago, activity is starting to pick also elsewhere in the world.

(References: Reuters, E&P, Business Wire, The Insight Partners, Markets And Markets, Marine Insight)

Sea News Feature, April 17