GlobalData Flags Oil and Gas Industry Resilience in 2023

In a release sent to Rigzone recently, GlobalData outlined that the oil and gas industry exhibited “resilience” last year.

The sector saw a “significant decline” of 22 percent in disclosed contract volume from 7,550 contracts in 2022 to 5,915 in 2023, GlobalData noted in the release. The company added, however, that, despite this decrease, “the industry managed to maintain momentum in contract value”.

This was primarily fueled by contracts for major projects such as North Field South LNG, Golden Pass LNG, Hail and Ghasha field, Agogo FPSO, and the expansion of the Amiral petrochemicals facility, amidst challenging market conditions, GlobalData stated in the release.

The company highlighted in the release that its latest report on oil and gas industry contracts revealed that “the total disclosed contract value kept momentum at $187.48 billion in 2023, only slightly lower than the $189.94 billion reported in 2022”.

According to a chart included in the release showing oil and gas industry contracts by scope in 2023, operations and maintenance deals took the largest share, with 3,040 contracts, followed by procurement deals, with 1,457 contracts, deals with a multiple scope, which totaled 725 contracts, design and engineering deals, which totaled 454 contracts, construction deals, with 209 contracts, installation deals, with 22 contracts, and asset retirement deals, with eight contracts.

“This resilience is attributed to high-value contracts from notable contractors such as Technip Energies and Consolidated Contractors’ that secured $10 billion EPCC contract for QatarEnergy’s North Field South LNG project,” Pritam Kad, an Oil and Gas Analyst at GlobalData, said in the release.

Kad also highlighted “Tecnimont’s $8.7 billion, Saipem and NPCC Consortiums’ $8.2 billion EPC contracts for the Hail and Ghasha Development Project in the UAE, Yinson Holdings’ $5.3 billion Agogo FPSO charter and maintenance, and Hyundai’s $5 billion EPC work for Amiral petrochemicals facility expansion in Saudi Arabia”.

“The oil and gas industry’s ability to secure high-value contracts for major projects underscores its enduring strength and adaptability in navigating turbulent times,” Kad went on to note in the release.

In a release posted on its website in March last year, GlobalData announced that the oil and gas industry witnessed a year on year increase of three percent in overall contract value in 2022, “despite a four percent decrease in contract volume”.

In that release, the company highlighted that its latest report at the time on oil and gas industry contracts showed that overall contract value increased from $178.86 billion in 2021 to $183.63 billion in 2022, “though contract volume saw a marginal decrease from 6,972 in 2021 to 6,668 in 2022”.

“The roller coaster ride during the Covid-19 pandemic appears to be coming to an end, with contract activity returning to normal for the global oil and gas industry, despite the ongoing Russia-Ukraine conflict and volatility in crude oil prices,” GlobalData stated in that release.

Operation and maintenance represented 50 percent of the total contracts in 2022, followed by contracts related to procurement accounting at 24 percent, and contracts involving multiple scopes at 13 percent, the company outlined in that release.

“Petrobras’ three floating production storage and offloading (FPSO) contracts worth $8.75 billion to Keppel Shipyard (P-80 and P-83 FPSO) and Sembcorp Marine (P82 FPSO) for the Buzios field in the pre-salt Santos basin, Brazil, were the significant contributors to the overall contract value during the year,” Kad stated in the 2022 release.

“The oil and gas industry is likely to see some relief in the short term for now, but the environmental concerns and the recent advances towards sustainable green fuel, and energy transition projects will present some significant challenges to growth in long run,” Kad added in that release.

To contact the author, email andreas.exarheas@rigzone.com