• Thu
  • Jul 24, 2014
  • Updated: 7:39am

Oil industry tips surge in tanker storage

PUBLISHED : Wednesday, 13 April, 2011, 12:00am
UPDATED : Wednesday, 13 April, 2011, 12:00am

Burgeoning development of offshore oil and gas fields buoyed by higher oil prices will lead to a surge in the use of floating production and storage ships between now and 2018. Industry experts say 17 of these static tankers are being designed in China or are in operation there alone.

Robin Allan, Asia director for Britain's Premier Oil, said 186 of the floating production, storage and off-take (FPSO) tankers are being designed, installed or in operation worldwide. He indicated that in Asia, the mainland is the second largest market for the ships, while a further 18 are earmarked for offshore projects in Australia and eight in Vietnam.

Stig Hoffmeyer, chief executive of Maersk FPSO, identified 196 offshore projects globally that are being developed between 2011 and 2018 that will need floating production facilities. He said tanker-type storage and production vessels will be the likely solution for 127 of these schemes.

The peak will be reached in 2013 when 42 projects, out of the 55 that are expected to go ahead that year, will use FPSOs.

Hoffmeyer said the use of these ships, which are designed to produce and store oil or gas from offshore fields before offloading the product to conventional tankers, is cheaper than building undersea pipelines. With the cost of these tankers topping US$1 billion each, this would represent an investment of at least US$127 billion.

Speaking on the sidelines of an FPSO conference in Singapore, Hoffmeyer said Maersk currently operated in Australia and the North Sea.

He said China was potentially a possibility long-term for the company. Most of the FPSOs operating in China are overseen by mainland oil giants including China National Offshore Oil in joint ventures with foreign companies such as Chevron.

Hoffmeyer said: 'We think there will be dramatic growth over the next 10, 20, 30 years.'

Most of the floating production and storage units in use have been converted from existing oil tankers but mainland shipyards are developing designs for new production and storage ships which are expected to remain in service for 30 years.

Big investment

Production of new storage tankers by 2013 is estimated to represent an investment of, in US dollars, $127b

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