The floating storage and offloading (FSO) vessel market is anticipated to surpass USD 30 billion by 2025, said a study.

The FPSO market is set to witness vigorous growth on account of shifting trends toward offshore exploration & production driven by depleting onshore oil & gas reserves, said a market report by GM Insights.

Development challenges including excessive costs, material transportation, environmental conditions and decommissioning associated with fixed infrastructures will further shift the industry focus toward the utilization of these vessels as an alternative, it said.

Furthermore, advancement in subsea technologies along with growing focus toward fast-track floating solutions will continue to stimulate the industry growth.

The converted FPSO market recorded annual deployment of 7 units in 2018. High potential to refurbish & redeploy numerous obsolete single-hulled vessels will create a lucrative market for these units.

Furthermore, key industry players, driven by international maritime legislation are invariably seeking redeployment opportunity for such depreciating assets to FPSO vessels.

Short development schedule along with relatively lower capital investment associated with the converted units is another major factor encouraging their deployment across the industry.

Progressive trends toward discovery and exploitation of smaller reserves present at remote offshore locations in conjunction with the capability of FPSOs to operate without support of a fixed structure will strengthen the market growth.

For instance, in January 2018, Chevron Corporation announced the discovery of an oil reserve offshore in the U.S. Gulf of Mexico at a water depth of about 1,900 meters. Further, the redeployment capability of these units to multiple oil field upon exhaustion of one reserve, coupled with their resistance to harsh weather conditions will escalate product deployment rate.

New built FPSO market is set to witness robust growth owing to growing interest of investors toward production from deep and ultra-deep-water oil reserves, said the report.

Latin America market capex, in 2018 was valued over USD 18 billion. Discovery of vast oil reserves in pre-salt geological layers along with favorable government policies and growing investments will boost the industry growth.

Growing number of discoveries and exploitation of marginal oil reserves at remote offshore locations coupled with the ability of FPSOs to function without a fixed structure support will positively influence the market growth.

Notable industry participants across FPSO market comprise Saipem, Bumi Armada, BW Offshore, CNOOC, MODEC, Inc., SBM Offshore, Woodside Energy, Exmar, Hyundai Heavy Industries Co., Ltd, KBR Inc.