Douglas-Westwood (DW), a leading provider of market research and consulting services to the energy industry worldwide, has picked out offshore wind energy and decommissioning as two bright spots for the super-heavy lift shipping sector.
Kathryn Symes, an analyst with the company, says that whilst heavy lift vessel (HLV) contractors have faced a challenging market in recent years. The low oil price environment combined with a shift towards subsea installation and deepwater activity has seen fixed platform installations decline globally; offshore wind is increasingly attractive as the volume of installed turbines per year grows rapidly and the projects become larger and further from shore.
In regards to the offshore oil and gas industry, DW says the number of fixed assets installed in 2017 is expected to be around 45 percent less than 2014 levels, which has resulted in a troublesome outlook for heavy lift vessels within the market for topside and jacket installation, leading contractors to seek out opportunities in less traditional markets.
In the offshore wind, growth has historically been supported by government subsidy. Today, recent (and projected) reduction in capital costs makes the technology cost-competitive with conventional forms of power generation such as nuclear and combined-cycle gas turbine (CCGT).
DW notes that whilst the market for turbine installation is predominantly covered by purpose built Wind Turbine Installation Vessels (WTIV), the installation of foundations and substations is accessible to HLVs.
Symes sees a key requirement for entering this market is sufficient deck space with the ability to carry at least four monopiles typically preferred. Although turbine size, and hence the size of the supporting foundation, are increasing with water depth it is unlikely that HLVs will need lifting capacity greater than 3,000 tonnes; crane capacity in the range of 1,500-3,000 tonnes is suitable for most offshore wind installations.
For HLVs with lifting capacity greater than 5,000 tonnes, decommissioning represents a significant opportunity, particularly within the North Sea which is characterised by large platforms – around 40 percent of platforms within the UK and around 85 percent of platforms within Norway have a combined substructure and topside weight greater than 5,000 tonnes.
With the introduction of super-heavy lift vessels such as Allseas’ Pioneering Spirit, Heerema’s Sleipnir (due for delivery in 2019) as well as recent orders from Shandong Twin Marine for two vessels with lifting capacity of 34,000 tonnes, it is hoped that the decommissioning of the North Sea’s heaviest platforms will become more efficient.
DW concludes that the offshore wind and decommissioning markets both have a heavy emphasis on cost reduction, and the resultant requirement for cost-effective HLV solutions going forwards will be extremely important. As such, in a market where day rates are often driven by tonnage requirements, super-heavy lift vessels may have a somewhat limited market reach and vessels that are overspecified will risk lower day rates.
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Source: Douglas Westwood