opportunities in the oilfield services markets in malaysia and indonesia
TRANSCRIPT
Opportunities in the Oilfield Services Markets in Malaysia and Indonesia
Subbu Bettadapura
Director, Energy & Power Systems
Asia Pacific
2
Competition Overview
The Upstream Industry Value Chain
Table of Contents
Upstream Industry Overview - Malaysia
Market Potential
1
2
3
4
2
MALAYSIA
INDONESIA
5
Upstream Industry Overview - Indonesia
3
1 Upstream Industry Value Chain
3
Value Chain
Source: Frost & Sullivan analysis.
Products
Exploration Phase Production Phase
Crude oil and Condensate
Natural Gas
Development Phase
Abandonment Phase
The upstream O&G industry is involved in the exploration and production (extraction) of oil or gas from onshore or offshore oil or gas fields. The key activities include exploration for O&G, appraisal of the O&G field, development, production, operations and maintenance, and then abandonment.
Greenfield Services Brownfield Services
Upstream Sector Value Chain
4
1 Upstream Industry Value Chain
4
Activities
Exploration Phase Production Phase
• Seismic activities• Drilling services• Marine support
• Engineering and project management
• Operations and maintenance services Field review and optimization
• Retrofit work• Hook-up and
Commissioning• Fabrication of structures• Structural maintenance
and upgrade• Equipment maintenance
and upgrade• Marine support
Development Phase
Abandonment Phase
Greenfield Services Brownfield Services
• Hook-up and commissioning
• Drilling services• Construction
and fabrication of structures
• Marine support
• Well plugging• Dismantling of
structures• Decommissioning
machinery and equipment
• Marine support
Activities in the Upstream Sector Value Chain
5
1 Upstream Industry Value Chain
5
Market Segmentation
Exploration Phase Production PhaseDevelopment
PhaseAbandonment
Phase
Greenfield Services Brown Field Services
Marine Support Services Market
Brown Field Services Market
6
Malaysia - Upstream Industry OverviewGrowing Complexity of Malaysia’s Reserves
Source: PETRONAS
• Malaysia’s total reserves,(2010) ~ 20.56 bboe
• Deepwater potential for oil & gas reserves is estimated to be 10bboe
• Growing Complexity in extracting Malaysia’s reserves
• Malaysia’s deepwater presents unique challenges such as complicated sea-bed relief with slope and stability issues
• Shallow hazards • Hydrate management• High CO2 content in gas
• Reserves estimate increase due to• Additions from new discoveries• Revised estimates due to EOR
2
• In Malaysia, deepwater definition ranges from depth of 200m to 1200m. Beyond 1200 meters is considered as Ultra deepwater
• Generally accepted deepwater definition - greater than 300 metres depth up to 1500 meters; Ultra deepwater - greater than 1500 meters depth
6
0.00
5.00
10.00
15.00
20.00
25.00
2005 2006 2007 2008 2009 2010
17.27 17.42 17.66 17.13 17.21 17.58
2.09 2.49 2.52 3.00 2.97 2.98
Reserves, bboeDW Reserves
SW Reserves
Deepwater Reserves, at ~ 3 bboe (2010), are 14.5% of total reserves
7
2
Increasing number of PSCs and International Companies Participation
Number of active PSCs: 82
•Currently there are 33 exploration, 15 development and 34 producing PSCs
20 international oil & gas exploration companies are present in Malaysia
16 of these operate oil & gas assets in Malaysia
Source: Petronas; Compiled by Frost & Sullivan
Malaysia - Upstream Industry Overview
7
8
Malaysia’s Upstream Expenditure – Increasing Trend
• Malaysia’s upstream expenditure has steadily increased over the years• The country’s upstream expenditure was 28.72 billion RM in FY 2010• Malaysia Upstream Expenditure, FY 2011 ~ RM 34 Billion
6.3 8.46
10 11 12.5
16.3
19.8 21.5 22.3
28.72
0
5
10
15
20
25
30
35
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
RM Billion
Year
Malaysia Upstream Expenditure, FY 2001 to FY 2010 Total number of producing fields: 106Oil : 68 Gas : 38
Oil and Gas Fields Discovered : 409Oil: 167; Gas: 242
Malaysia - Upstream Industry Overview2
Source: Petronas; Compiled by Frost & Sullivan 8
9
Deep Water is the Final Frontier – Its true for Malaysia too
Malaysia- Upstream Industry Overview
Increasing Depth
Malaysia is faced with the prospect of declining shallow water reserves – a phenomenon true for most countries (except a few OPEC and Russia)
Global Drivers for DW projects
•Decline in shallow water reserves•Strong growth in energy demand•Rising oil & gas prices•Long term sustainability•Technology now exists to tap oil at depths exceeding 3 km
Drivers specific to Malaysia
•Capability development & local participation•Goal to grow competency to be DW regional hub and global player
2010200620021983
Deep water projects more expensive and carry more risks
Oil price estimates for project to break even -•Shallow water: $40•Shallow water, marginal: $65•Deepwater: $ 80•Ultra deepwater: $80 to $100
2
9
10
2
Source: Compiled by Frost & Sullivan
Deepwater Fields Being Developed
Gumusut/Kakap (Block J & K)Development Stage
Recoverable: 620mboeDepth: 1,100m
Onstream: 2011/2012Operator: Shell
Malikai (Block G)Development Stage
Recoverable: 108mboeDepth: 480m
Onstream: 2012/2013Operator: Shell
KebabanganDevelopment StageRecoverable: 2.2tscf
Depth: >200mOnstream: 2012/2013
Operator: KPOC
Jangas (Block J)Pre-Development StageRecoverable: 81mmboe
Depth: >1000mOnstream: 2012/2013
Operator: Murphy
Ubah Crest (Block G)Pre-Development StageRecoverable: 215mmboe
Depth: >1000mOnstream: 2013/2014
Operator: Shell
Pisangan (Block J)Pre-Development StageRecoverable: 56mmboe
Depth: >1000mOnstream: 2013/2014
Operator: Shell
KamunsuPre-Development Stage
Recoverable: 2.2tscfDepth: >1000m
Onstream: 2014/2015Operator: KPOC
North Siakap – PetaiPre-Development Stage
Limbayong, Block GPre-Development Stage
Malaysia – Upstream Industry Overview
10
11
Deepwater Production Forecasts
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Deep Water Addition
Deep Water Existing
Shallow Water Addition
Shallow Water Existing
Mal
aysi
a O
il P
rodu
ctio
n (%
)
• Deep Water to contribute 30% of oil production in 2020• Shallow water existing includes production from SW marginal fields and EOR additions
2 Malaysia – Upstream Industry Overview
Source: Petronas; Compiled by Frost & Sullivan
11
12
Development Solutions for Malaysia Deepwater Projects
2
Malikai
North Siakap Petai
Gumusut Kakap
Kikeh Kebabangan
Sub-sea
TLP
Fixed PlatformSPAR
FPSO
FPSSabah Oil
& Gas Terminal
Malaysia – Upstream Industry Overview
12
13
Wells Drilling Forecast, Malaysia
2 Malaysia – Upstream Industry Overview
Forecast includes both shallow water and deepwater (Exploration, Appraisal and Development) Wells
•6 deep water fields (of the total wells forecast, 20% are in deepwater)•22 new Shallow Water Blocks•10 Marginal fields•6 fields identified for Enhanced Oil Recovery (EOR)
13
Source: Frost & Sullivan Estimates
0
10
20
30
40
50
60
70
80
90
2009 2010 2011 2012 2013 2014 2015
59 62 65 71 73 77 83 Wells Drilled
14
Upstream Expenditure
3 Indonesia - Upstream Industry Overview
14
• Indonesia’s upstream expenditure has increased steadily since 2001.The country’s upstream expenditure for FY 2011 is forecast to be $17.0 billion.
Upstream Expenditure, 2001-2010Indonesia
1.92.5 2.6 2.8
3.44.2
8.5
1210.8
13.2
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Year
Source: Frost & Sullivan analysis.
15
Oil Production and Consumption
3 Indonesia – Upstream Industry Overview
15
Oil Production & Consumption, Indonesia
Oil Exporter Turned Importer
•Increasing domestic demand•Falling domestic production
Remediation
•Brown fields to be rejuvenated•More exploration to improve reserves•Reduce demand
The demand for oil is expected to ease as natural gas increasingly substitutes oil in the power sector.
Approximately $10.0 billion is needed to halve the current oil consumption and replace it with gas.
16
Oil Production Outlook
3 Indonesia – Upstream Industry Overview
16
Oil Production Outlook, 2010-2015Indonesia
• To meet these two targets, E&P investments and good project management have become important
• Data acquisition techniques are necessary for new discoveries
Source: BP MIGAS
954
MBOPD – 1000 Barrels per Day
Actual(MBOPD)
920* 920*
• Oil production to decrease or at best stay at current levels in 2011 and 2012
• Forecast
Source: Frost & Sullivan analysis.
17
Natural Gas Production Outlook
3 Indonesia – Upstream Industry Overview
17
Natural Gas Production Outlook, 2010-2020Indonesia
Source: BP MIGAS, Frost & Sullivan analysis.
• If this potential is not realized, Indonesia is likely to be a net gas importer by 2021
Bringing projects onstream on time assumes importance if all contracted commitments and projected demand increase are to be met
18
Offshore Prospects
3 Indonesia – Upstream Industry Outlook
18
Source: Planning Dept, Govt of Indonesia; Petroleum Geo-Services; Frost & Sullivan analysis.
Offshore Potential, IndonesiaDeepwater Potential: Tarakan basin; Papalan Basin
Thrust from Government for faster development of gas projects for meeting domestic and export gas demand
East Kalimantan
Masela Block10 TCF Reserves; water
depth 300m to 1000mInpex to invest $ 4.9 billionfor floating LNG plant (2.5 mmtpa) with production
start-up in 2016
Makassar StraitGehem, Gendalo, Gandang, Maha and Bangka
fieldsChevron to develop East Kalimantan deepwater
fields, and Gehem and Gendalo projects.Investment $7.0-$8.0 billion.
Plan Of Development approved
Shallow Water Bukit Tua
Deep Water•Gehem•Gendalo
• INPEX Masela FLNG• Petramina FSRU
Prospective FPSO Projects
19
4 Competition OverviewKey Players
19
Note: Licensing is an essential pre-requisite to compete in this industry.
Key Players in Malaysia include SapurCrest Petroleum, Kencana, Petra Energy, Dialog Group, Bumi Armada, etcKey Players in Indonesia include Apexindo, Elnusa, Gearindo, PT Wintermar Offshore Marine, etc
TRENDDecreasing Stable Increasing
▼ ●● ▲
Competitor Overview , Oilfield Services Market: Malaysia & Indonesia
Source: Frost & Sullivan analysis.
20
5
Source: Compiled by Frost & Sullivan
Offshore Potential in the Asia Pacific Region; Offshore Prospects
KG Basin6.76 TCF
Offshore Sabah (10 TCF) & Sarawak (45
TCF) 4.2Bboe proven; 8Bboe potential
Gulf of Thailand
Arthit 1.9TCF
Bohai Bay 7.35 Bboe
Carnarvon 95.5 TCF
East Kalimantan 47 TCF
Makassar Strait6 TCF
Kikeh 700 mmboe
Masela 10 TCF
Phu Khanh Basin
2.48Bboe
Shwe Gas Field
8 TCF
Browse 30.3 TCF
M9 Field, Gulf of
Martaban 1.76 TCF
Bonaparte29.5 TCF
Gippsland10.65 TCF
• Asia Pacific – a significant deepwater region
Market Potential
20
21
5 Market PotentialMalaysia as the Oilfield Services Hub: Key Success Factors
Infrastructure
Government Policies
Location1
2
3
Cost Competitiveness4
21
22
Development of Labuan and Sabah Region as the Deep Water Services Hub
5
Labuan and Sabah region has the potential to be developed into a deep water services hub
Drivers for Development of Labuan and Sabah
Gumusut / Kakap, Malikai, Jangas, Ubah Crest, Pisangan and Kamunsu deep water fields are being developed
Sabah Oil and Gas Terminal (SOGT)
Development of logistics - MOU between Labuan Shipyard & Engineering (LSE) and Asian Supply Base (ASB)
Important to leverage the deepwater oil & gas reserves, operators, specialised equipment manufacturers, service providers and offshore engineering companies
Market Potential
22
23
Key Activities Kikeh Gumusut
Kakap
Malikai Kebabangan, North
Siakap–Petai, UbahCrest,
Pisangan, KemunsuEast
All future
deep water
projects
Subsurface
Studies/Field
Development Plan
Malaysia North America Malaysia Malaysia Malaysia
Engineering
•pre-FEED
•FEED
•Detail Design
Malaysia
North America
Europe
Malaysia
North America
Malaysia Malaysia Malaysia
Procurement Malaysia
North America
Europe
Malaysia
North America
Malaysia Malaysia Malaysia
Fabrication
•Topside
•Hull
•Subsea
Malaysia
Europe
Malaysia Malaysia Malaysia Malaysia
Petronas Aspires to Transfer Development and Operation Activities to Malaysia
5 Market Potential
23
Source: Petronas
24
5 Market PotentialEstimation of Market Potential: Malaysia
24
Source: Frost & Sullivan analysis.
Revenues ($
Million)
Y-o-Y %
Growth
Rate
2010 243.0 19.9%
2016 415.4 9.0%
Brownfield Services Market
Marine Support Services Market
Revenues
($ Million)
Y-o-Y %
Growth
Rate
2010 131.8 12.0%
2016 230.4 8.5%
This estimation assesses the outsourced component for Marine Support
(includes marine support for both greenfield and brownfield services)
The Market Size includes marine support assets such as:
Work Boat, Work Barge, Crew Boat, Utility Vessels (UV), Diving Support
Vessels, Platform Service Vessels (PSV), Anchor Handling Tug Supply
(AHTS)
This excludes FPSOs, Drill Ships, Semi-Subs and Jack-ups
This estimation assesses the outsourced component.
Includes brownfield services (including marine support services for
brownfields)
•Equipment Packaging & Supply
•Marine Support
•Retrofit
•Minor Structure Fabrication
•Operation & Maintenance
•Decommissioning Services
25
5 Market PotentialEstimation of Market Potential: Indonesia
25
Source: Frost & Sullivan analysis.
Revenues
($ Million)
Y-o-Y %
Growth
Rate
201
0585.4 18.5%
201
61707.8 19.2%
Brownfield Services Market
Marine Support Services Market
Revenues
($ Million)
Y-o-Y %
Growth
Rate
2010 317.3 17.5%
2016 910.5 16.5%
This estimation assesses the outsourced component for Marine Support
(includes marine support for both greenfield and brownfield services)
The Market Size includes marine support assets such as:
Work Boat, Work Barge, Crew Boat, Utility Vessels (UV), Diving Support
Vessels, Platform Service Vessels (PSV), Anchor Handling Tug Supply
(AHTS)
This excludes FPSOs, Drill Ships, Semi-Subs and Jack-ups
This estimation assesses the outsourced component.
Includes brownfield services (including marine support services for
brownfields)
•Equipment Packaging & Supply
•Marine Support
•Retrofit
•Minor Structure Fabrication
•Operation & Maintenance
•Decommissioning Services
26
http://twitter.com/frost_sullivan
Follow Frost & Sullivan on Facebook, LinkedIn, SlideShare, and Twitter
http://www.facebook.com/pages/Frost-Sullivan/249995031751?ref=ts
http://www.linkedin.com/companies/4506
http://www.slideshare.net/FrostandSullivan
27
For Additional Information
Donna JeremiahCorporate CommunicationsAsia Pacific+603 6204 [email protected]
Carrie LowCorporate CommunicationsAsia Pacific+603 6204 [email protected]
Subramanya BettadapuraDirectorEnergy & Power [email protected]
Dewi NurainiCorporate CommunicationsIndonesia+62 21 571 [email protected]