Offshore logo
Feeling the brunt
Posted 07.07.2009 09:59:58 av John Bradbury
Vis RSS feed
Send nyhet til en venn
The UK's subsea industry is feeling the brunt of the economic downturn in the North Sea by being hit with a triple whammy of price pressure, cost-cutting and and fall in work backlogs.

And the short-term outlook remains a tough one for many businesses, says the organisation's chief executive Alistair Birnie, warning times will get worse before they begin to get better, “..With very limited visibility of new orders and enquiries.”

The gloomy industry outlook has been spelled out in the second of two specially commissioned economic reports compiled for Subsea UK by industry analyst Douglas Westwood. The only bright spot detected in the gloomy industry outlook was the resilience of the inspection repair and maintenance market where activity has held up well, reflecting the ongoing demand for maintaining ageing North Sea installations.

“Reductions in activity are persisting, backlog build is lessening and price pressure and cost reduction are the norm, within the 21 companies reviewed for the studies in 2009m” warns Birnie. “The impact of these measures will be felt across the Subsea UK membership through the supply chain as cost reduction initiatives are maintained.”

Subsea companies based in the UK are to some extent sheltered by the effects of the industry due to their commitments overseas in activity hotspots such as West Africa and Brazil, but even there, activity is slowing, said Birnie. “These effects are expected be more apparent toward the end of this year into 2010, so businesses need to be vigilant when considering cash flow and working capital requirements,” he warns.

Both the last quarter of this year, and early 2010 are showing a lack of orders, which is prompting concern for companies about future projects which may also be delayed. “This concern has been fuelled by a lack of front end activity on the ground that would normally be visible and which suggests that there may be further delays in new projects coming through,” Birnie underlines.

Subsea UK goes on to state that a further indication of the business downturn is the improving availability of equipment: “Where previously there would have been a lead time of several months for equipment, such as survey sensors, we are now seeing equipment being made available ex stock. A more opportunistic market is evolving where buyers are anticipating availability of equipment, delaying their purchasing patterns.

And the organisation adds: “There are two aspects to this – the backlog is visibly drying up but against that, the ability to respond quickly to enquiries is helping these businesses secure sales in the short term – providing, of course, that the suppliers are able to finance the stock holding.”
 
Apart from the UK, downturns are being seen onshore North America, Russia, Saudi Arabia, and the Caspian, while buoyant markets are seen in Norway, Africa and South America.

After taking soundings on market perceptions for next year, most of the 21 companies surveyed were more optimistic, with half of them expecting a growth in E&P expenditure, while 32% also expect spending to be up by 20% or more. And 13% said expenditure would increase by between 10% and 20%, and 13% expected expenditure to rise more modestly, by between 1% and 10%.
Advertisement
Latest news

Asset integrity expertise bought

British-based engineering expertise has been bought up by Norway's Aker Solutions to boost its integrity analysis for oil and gas assets.

[Les mer ] Company news

Sound signals big Italian gas

London-listed Sound Oil has logged a big new gas find in Italy.

[Les mer ] Exploration

Aker anchors new accommodation unit

A new offshore accommodation unit under construction in China is to be fitted with a mooring system supplied from Norway.

[Les mer ] Contracts

Big gas at Bianchi 1

Austria's OMV has reported a major new gas find while drilling offshore Australia following on from its earlier Zola discovery.

[Les mer ] Exploration

New drilling near Johan Castberg

Swedish explorer Lundin Petroleum has kicked off a new exploration well in the Norwegian sector of the Barents Sea.

[Les mer ] Exploration

Irish data acquisition underway

Seismic data acquisition has kicked off on a newly allocated Irish Frontier Exploration Licence.

[Les mer ] Exploration

Profilerte stillingerAlle stillinger »
Profilerte selskapFra OffshoreX.no
WellCem AS Logo

WellCem AS

WellCem is a Company providing Well Therapy solutions to the oil and gas industry. The Company has developed and patented a multi component resin based polymer with qualities far superior to cement. Head office in Tananger Norway Established operation and opened up office and warehouse in Saudi Arabia in 2011. APPLICATIONS Total Loss Circulation, Casing & Tubing leak repair, Plug for P&A

Se profil | offshorex.no
LOS Elektro AS Logo

LOS Elektro AS

LOS Elektro AS gjennomfører V&M-kontrakter innen EIT installasjoner på olje og gass inst. Ofte er disse underleverandørkontrakter til større multidisiplin kontraktører som betjener oljeselskapene. Tjenesten kan være ny installasjoner, utvidelse eller vedlikehold. Våre ansatte yter ingeniørtjenester, høyspentoppdrag, prosjektering, risikovurderinger, innkjøp, installasjon, testing og dokumentasjon.

Se profil | offshorex.no
PSSI AS Logo

PSSI AS

Focused on on-offshore with API pumps,filters,strainers,lub.systems. service - Rep.Mech.seals, couplings, coating, minimess equip.Rental pumps & filters.

Se profil | offshorex.no
SCANMATIC AS Logo

SCANMATIC AS

Scanmatic is a technology company utilising cutting edge multidisciplinary engineering competence within sensor technology and data acquisition to design and supply tailor made instrumentation, monitoring & control and communications applications specialised for Oil & Gas as well as marine environment.

Se profil | offshorex.no
Marwin Løfteteknikk AS Logo

Marwin Løfteteknikk AS

Marwin Løfteteknikk AS is exclusive dealer for Slingmax products in Scandinavia. A high end range of rigging solutions featuring their Twin-Path fibre sling; low weight, extreme braking load. Marwin Løfteteknikk AS are also authorized dealer for Dillon, the world leader in dynamometers since 1937.

Se profil | offshorex.no
Victor A/S Logo

Victor A/S

Victor A/S leverer services og løsninger til markederne energi, offshore og marine. Vi producerer og leverer EPCM løsninger i komplekse rørsystemer i alle metaller, plastik og fiberglas, tryksatte/ikke-tryksatte tanke, konstruktion af procesmoduler og konstruktion af køleløsninger til ethvert formål.

Se profil | offshorex.no
Tips oss
Kontakt oss
Offshore.no AS
Annonsere
Ansvarlige
Sjefsredaktør: Erlend Keilen
OPPHAVSRETT
Alt innhold er opphavsrettslig beskyttet.
Copyright Offshore.no AS