ROVs: down but not out

October 20, 2015

Following the fate of the global oil industry, the short-term outlook for the remotely operated vehicle (ROV) market is set to be sluggish – but long-term these machines will play a key role in deepwater development and the technology they use is set for a leap forward.

Image from Schilling Robotics. 

Both the market outlook and where ROV and autonomous underwater vehicle technology could go were discussed at Subsea UK’s ROV Conference, in Aberdeen, late September.

Kieran O’Brien, an analyst at Infield Systems, told the event that the key drivers for ROV demand are drilling rigs, at about 74% of demand for ROVs usually, but down to 71% more recently, as well as subsea Xmas tree orders.

Thanks to the persistently low oil prices since late 2014, drilling rates have plummeted – Baker Hughes’ showed the offshore rig count dropped 20% to 304, between August 2014 and August 2015 – predictably sending ROV demand down. Subsea Xmas tree orders have suffered a harder fate, tanking over the past year by some 39%, based on an annual compound growth rate (CAGR) in 2013-2015, following a record year for orders in 2013 – levels we are not likely to see again, O’Brien says. But, despite the recent drop, 2015-2019 is set to see 27% CAGR for subsea tree orders, dominated by Africa in the early years and then Latin America in the later years.

Taken together, these factors will see a fall in demand for ROVs, he says, up to 2017, when demand will rise again, but then remain flat in the later years of the decade, compensated to a degree by a still active marine construction market, as shallow water construction projects still go ahead.

   

Graph: Data from InfieldROV - Infield Systems Ltd.

The largest geographic area of demand for ROVs is the US, with an anticipated 306,000 ROV operating days in 2011-2020, followed by Brazil, at 258,000 days, O’Brien says. Demand in the US is predicted to be largely flat, through 2011-2020, however. Brazil is expected to see stagnant growth this year and next, but then increase gradually through 2020. Offshore Angola, demand is expected to pick up in 2017 and then remain fairly flat.

Looking at 2016-2020, drilling will continue to take up less of the ROV market, as deepwater and ultra deepwater construction comes in to play, O’Brien says, highlighting figures that show generally stronger predicted growth rates (6-14%) when drilling is removed from the figures (3-6% including drilling), except for in North and South America, which generally show slugging rates for both, i.e. 3% for North America (1% excluding drilling) and 2% for South America (-5% excluding drilling).

Currently, the market is also well served for ROVs after work class ROV newbuilds saw a high of nearly 140 in 2008, compared to fewer than 50 in 2005. The newbuild rate fell in 2009-10, but rose again in 2011-2013, at between just over 100 and nearly 120 per year, with Oceaneering leading the pack, followed by Forum Energy Technologies, and FMC Technologies Schilling Robotics.

Exactly what shape and how future ROVs function was also discussed at the Subsea UK event. ROV systems developers such as Schilling Robotics and Subsea 7, which is developing its autonomous inspection vehicle (AIV), are aiming to push boundaries in subsea robotic technologies, using automation both in terms of operation and navigation.

Jim Jamieson, technology manager at Subsea 7, gave an update on the firm’s autonomous inspection vehicle (AIV). With it, the firm makes to make a step change in underwater robotics by creating an untethered system that can fly off on pre-programmed missions, initially to just inspect – “see and sense” – but, eventually to also “touch and do.” It could be basket deployed from a ship or FPSO or be based from a platform. Subsea 7 has reached the see and sense stage with it, with touch and do next on the hit list.

Peter MacInnes, VP Sales & Marketing at FMC Schilling Robotics, outlined his firm’s vision for more highly automated intelligent ROVs, to increase productive time, consistency, use of data and repairability. 

However, while companies such as Subsea 7 and Schilling Robotics continue to push boundaries, ROV and AUV operators still have some way to go to persuade some operators their tools, initially designed in the 1970s to stop the need for use of divers, are worth using. In a presentation by Apache’s North Sea project services manager, Richard Stark, delegates were told using ROVs was new to Apache in the North Sea, following its acquisition of the Beryl fields and that it had tried out an AUV on the Forties pipeline, as part of an inspection, for the first time last year. But, he said he was keen to see what the technology could offer and try new solutions.

With the existence of such operators yet to fully use ROVs and AUVs, there could be a bigger market than some think – if the developers can get prove to those operators these tools offer value for money, especially in today’s market.

To find out more, pick up your copy of OE’s November issue.

Read more

Sea change 

The ROV Renaissance man

Sparking a ROVolution

 


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