Market Trends of Offshore Pipeline Industry
The Gas Segment is Expected to Witness Significant Growth
- The rising demand for natural gas has resulted in the discovery of new gas fields as well as the adoption of simple and low-cost transportation of natural gas exports via subsea (offshore) pipelines, which are anticipated to drive the offshore pipeline market.
- Global natural gas production was recorded at 4043.8 billion cubic meters in 2022. North America is the leading natural gas producer, accounting for about 1203.9 billion cubic meters, followed by the Middle East and Africa with 970.3 billion cubic meters. This is expected to drive the offshore pipeline market during the forecast period.
- In September 2022, EUROPIPE, located in Germany, was awarded by North American TC Energy (TCE) a contract to supply pipe for the Southeast Gateway Pipeline project in the Gulf of Mexico. TCE is constructing the USD 4.5 billion offshore gas pipeline in collaboration with the Mexican state-owned power utility Comisión Federal de Electricidad (CFE) to ensure southeastern Mexico's electricity supply. The project was awarded to EUROPIPE, a joint company of Salzgitter Mannesmann and Aktien-Gesellschaft der Dillinger Hüttenwerke, at the end of August. The project’s scope involves supplying 265,000 metric tons of pipe (365 kilometers) with anti-corrosion coating.
- Additionally, in January 2023, Eni reported a significant new gas discovery at the Nargis-1 exploration well in the Nargis Offshore Area Concession off the coast of Egypt in the Eastern Mediterranean Sea. The Nargis-1 well was drilled in 1,014 feet (309 m) of water and encountered roughly 200 net feet (61 m) of Miocene and Oligocene gas-bearing sandstones. The discovery can be developed by taking advantage of Eni's current facilities.
- Furthermore, recent waves of cost reductions and key technological breakthroughs have allowed many oil and gas exploration and production companies to diversify into sustainable deepwater and ultra-deepwater developments.
- As a result, the offshore pipeline market is anticipated to expand rapidly in the near future. As a result of the preceding, the gas segment is anticipated to grow at a rapid pace during the forecast period.
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North America is Expected to Dominate the Market
- During the forecast period, North America is anticipated to dominate the global offshore pipeline market. Several countries in the area are attempting to invest in offshore oil and gas exploration. During the forecast period, oil and gas pipeline infrastructure in countries such as the United States and Canada is anticipated to remain fully operational.
- With increased activity in the Gulf of Mexico, the offshore pipeline market in the United States is anticipated to expand significantly. The forthcoming new gas production projects are expected to significantly expand the region's subsea pipeline network.
- For instance, in January 2023, Talos Energy, headquartered in Houston, discovered commercial quantities of oil and natural gas in two deepwater discoveries in the United States Gulf of Mexico, which it intends to develop as subsea tie-backs to its Ram Powell tension-leg platform (TLP). According to the US player, 78 feet and 72 feet of net pay zone thickness were discovered in the main targets at Lime Rock and Venice, respectively, with excellent geologic qualities.
- As of December 2021, TC Energy Corp. and Mexican state power utility Comisión Federal de Electricidad (CFE) were in talks to build a new offshore gas pipeline to supply the Yucatán Peninsula, which has faced chronic gas shortages due to stagnant domestic production. Also, Sempra’s 3.25 million metric tons/year (mmty) Energia Costa Azul (ECA) liquefied natural gas (LNG) Phase 1 terminal reached a final investment decision in 2021. It is expected to start operation by 2024.
- Furthermore, technological advancements are anticipated to drive stable and robust growth in the Canadian pipeline business over the next several years. Pipelines are regarded as the safest, most dependable, and most cost-effective way of meeting the energy needs of high-value end-user markets in the Canadian oil and gas sector.
- As a result, North America is anticipated to be the major region in the offshore pipeline market during the forecast period, owing to increased investment in oil and gas projects.
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