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Opportunities For Service Providers In Indian Offshore
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Opportunities for Service Providers in Indian
Offshore was presented at Offshore Oil & Gas summit organised by IBC Asia. The presentation has brief mention of the offshore oil & gas projects in India and future opportunities in the sector for service providers such as offshore drilling companies, logistics providers, etc

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Opportunities For Service Providers In Indian Offshore Presentation Transcript

  • 1. 2nd Annual Offshore India Oil & Gas Summit, Mumbai, 2010 Opportunities for Service Providers in Indian Offshore Anand V Sharma Mantrana Maritime Advisory
  • 2. Summary of Ongoing activity in the offshore E&P in India www.mantrana.in 2
  • 3. Companies with large budgets for Offshore E&P - India • Reliance Industries has been spending annually more Discoveries by Company than US$ 2 billion on Offshore E&P activity • ONGC has budgeted about US$ 16 billion to be spent on Others Offshore Mostly 13% domestic E&P activity between 2007-12 Offshore Reliance • Offshore to have substantial share ONGC Industries 11% 36% • GSPC plans to raise close to US$ 1 billion from IPO Offshore • Roughly 35% to 40% to fund its KG Basin GSPC • About 20% to 25% to fund its other E&P activity 18% Cairn • Rest to settle previous debt Energy Mostly 22% Onland • Cairn India to invest to redevelop its depleting fields in Cambay basin and Rava Investment on E&P translates into revenue for service providers www.mantrana.in 3
  • 4. Opportunities for Service Providers - India Proposed development projects and ongoing redevelopment projects in Offshore Oil & Gas Sector Gulf of Cambay Existing fields of Cairn Mumbai Offshore Discovery of ONGC, Reliance, GSPC Redevelopment of Mumbai Offshore by ONGC Source : DGH www.mantrana.in 4
  • 5. India’s E&P companies • ONGC is the largest Exploration & Production company in India with maximum budget It is the largest producer of Offshore Oil & Gas in India Plans to invest US$ 2 bn for redevelopment of Mumbai Offshore It has maximum number and area for exploration and development It employs the maximum number of rigs and logistics support for Offshore E&P in India It mostly hires rigs and vessels on a long term time charter ranging between 3 yrs to 5 yrs ONGC also awards drilling and construction projects on a turnkey basis, hence service providers have opportunities to find employment with companies serving ONGC • Reliance Industries would be the 2nd largest E&P company in India Has discovered one of the largest offshore gas field in East Coast of India Hires vessels on long term and short term charters Aker Solutions is developing its deepwater field on the East coast of India, Bechtel has undertaken project management consultancy www.mantrana.in 5
  • 6. India’s E&P companies • Gujarat State Petroleum Corporation (GSPC) Discovery of 4 TCF gas reserves on East Coast on India Planning to drill 15 well on the East Coast of India Initial production estimated to be 400 MMSCFD Has commissioned 1 Jackup of Aban Offshore for field development Likely to hire more rigs • CAIRN It has existing production fields in Offshore India Looking to hire rigs for drilling 13 wells in 3 fields with option of 4 wells • There are other E&P operators such as Niko Resources, BG, ENI too have presence in India www.mantrana.in 6
  • 7. Demand for Marine Assets - India www.mantrana.in 7
  • 8. Statistics & Projections Related to Offshore Drilling - India Ideally, the future projection of wells to be drilled should be estimated from the committed MWP by E&P Companies. However, a more simplistic approach is as follows Cumulative drilling depth in Offshore India (‘000) Number of Wells drilled in Offshore India 700 Future Projection 200 600 180 500 160 140 400 CAGR 14% 120 300 100 CAGR 15% 80 200 60 100 40 CAGR 8% 0 20 CAGR 7% Fy -03 Fy-09 Fy-14 0 Fy -03 Fy-09 Fy-14 Exploratory Development Exploratory Development www.mantrana.in 8
  • 9. Drilling Fleet - India Water Depth < 100 m Drilling Rigs for Water Depth > 100 m Discovery Hydrocarbons Jagson Precision Drilling Northern Offshore www.mantrana.in 9
  • 10. Demand for Rigs - India Demand for offshore rigs due to contract completion 2010 2011 2012 2013 2014 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Hercules Offshore 1 1 Jagson 1 Noble Drilling 1 1 Northern Offshore Precision Drilling 1 Transocean 1 2 2 3 1 Aban Offshore 1 2 2 1 GreatShip 1 1 Jindal Drilling 1 1 Total 2 0 1 3 3 3 2 2 1 1 0 1 3 1 1 0 1 0 0 • The above rigs could be rehired on nomination basis • ONGC planning to hire 6 rigs in the year 2011 • ONGC has two ultra deepwater rigs scheduled to join in Dec, 2010, independent of the above table > 100 m water depth < 100 m water depth www.mantrana.in 10
  • 11. Demand for Offshore Logistics - India • Long Term Demand (Results in Long Term Charter) Every cluster of rig or production platforms should be supported by 2 vessels at least 1 for supply and 1 as standby to handle all emergency response E&P company look for long term charters Drilling companies such as Transocean, which undertake turnkey contracts for drilling wells charter Supply vessels for longer term • Short Term Demand (Spot Charter) Every Year there is demand for AHT/AHTS for offshore towage prior to monsoon Roughly 25 to 30 Anchor Handlers are chartered every year between March to May 15 There is demand of Supply vessels, construction barges, heavy lift vessels, etc by PMC for short term www.mantrana.in 11
  • 12. Supply of Marine Assets for Marine Assets - India www.mantrana.in 12
  • 13. Future Supply of Drilling Rigs in India •3 Rigs on the building berths √ Self propelled Jackup by Great Offshore at Bharati Shipyard √ 2 x Jackup rigs by Essar Oil Field services at ABG Shipyard • All 3 rigs are built at Greenfield Shipyards • Both the Shipyards namely ABG Shipyard and Bharati Shipyard do not have prior rig building experience • Great Offshore rig at Bharati Shipyard is running more than a year behind schedule, may get delivered by end of 2011 • Essar rigs at ABG Shipyard could get delivered in 2012 www.mantrana.in 13
  • 14. Future Supply of Supply Vessels in India Calendar Years 2010 2011 2012 Total Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Garware Offshore MSV 1 1 1 Great Offshore MSV 1 1 GreatShip (India) AHTS 1 1 2 MSV 1 1 1 1 4 PSV 1 1 1 3 ONGC AHTS 1 1 1 1 2 2 2 2 12 Samson Maritime PSV 1 1 1 3 TAG Offshore AHTS 1 1 Shipping Corporation AHTS 1 1 1 1 1 1 6 Total 2 3 5 5 3 3 3 3 2 2 2 33 •Above list excludes ships built by shipyards for themselves •Greatship (India) limited has committed a Capital investment of US$ 365 for ongoing fleet expansion •A new company with young fleet, subsidiary of India’s largest shipping company in private sector •Proposed IPO to fund future expansion •Samson Maritime has 3 ships on orderbook •ONGC ships are managed by Shipping Corporation, would be deployed in India for ONGC project •ONGC has ordered 12 ships to Pipavav Shipyard (A Greenfield Shipyard), delayed delivery likely •Shipping Corporation would deploy all its ships in India, most likely on ONGC projects www.mantrana.in 14
  • 15. Conclusion Offshore E&P • India is a lucrative market for service providers to Offshore oil & gas segment • ONGC should be the target client followed by Reliance, GSPC, CAIRN and others • Firm investments in E&P is planned till 2012, post 2012 investments are likely to increase Offshore Drilling • Demand for rigs to remain robust in India, especially above 100 m water depth • Very few local supply is in pipeline • Rigs are mostly hired for 3 to 5 years by ONGC and Reliance • Companies such as (GSPC, CAIRN, ENI, etc) with smaller blocks (by number) hire it for short term on per well basis Offshore Logistics • Demand for Offshore logistics is robust • Demand supply gap is high • A substantial number of supply vessels on building berth are likely to face delayed delivery www.mantrana.in 15
  • 16. About Mantrana •Undertakes research & consultancy on the Indian Maritime Sector •Undertakes economic advisory on the following maritime segments √ Offshore Drilling & Logistics Sector √ Shipbuilding √ Shipping √ Ports & Logistics •Following are key services provided by Mantrana Team √ Market Study √ Project Feasibility Study √ Business Plan √ Bid Advisory √ Due Diligence for investment www.mantrana.in 16
  • 17. Thank you for your Attention Mantrana Maritime Advisory Pvt. Ltd. A-207, Sai Chambers, Plot No. 44 Sector -11 CBD Bealpur Navi Mumbai - 400 614. Maharashtra, India Landmark : Near CBD Station, Opp IDBI Bank Bldg. Tel : +91-22-6609 8010 Fax : +91-22-6609 8013 Email : info@mantrana.in Web : www.mantrana.in www.mantrana.in 17