SPECIAL REPORT: State of the Offshore Market
By Kathy A. Smith
Increasing capital investments in offshore vessels indicate the market is steadily on the rise. The annual spend on OSVs has boomed from almost $500 million to nearly $1.4 billion during the last five years, says a report by Douglas-Westwood Associates. And according to a late 2010 study by Germanischer Lloyd, the number of OSVs worldwide is projected to increase beyond 2,500 through 2020, with demand not only in the oil and gas markets but the offshore wind industry as well.
Clearly the need for these specialized ships is growing, as is the gradual recovery of work in the Gulf of Mexico after the Macondo blowout of April 2010. As of the end of October, 65 of the 116 offhore rig units in the region were under contract with fleet utilization at 56 percent, according to ODS-Petrodata, with the numbers creeping up toward those at this time last year. "We are once again beginning to see deepwater drilling permits issued, albeit at a much slower pace than before," says John S. Cook, Senior Vice President of Hornbeck Offshore Services in Covington, Louisiana, which owns a fleet of 80 vessels primarily serving the energy industry.