There are 2,511 identified pending, probable and possible subsea production wells forecast (base case) worldwide during the next six years. Some 18% of these subsea completions will be installed in North America, 30% in Africa and the Mediterranean, 8% in the Asia-Pacific region, 26% in the North Sea and 18% in Brazil. These subsea projects are in various development stages, including 23% at the pending/construction stage, 11% in bidding, 9% in detailed engineering and 16% at the front-end engineering design stage. Of the wells, 16% are probable and 26% are possible, indicating possible development in the future. Houston-based Quest Offshore Resources Inc. estimates there will be approximately 335 subsea completions installed this year worldwide, and the number will grow to 364 in 2003 and 372 in 2004 (base case). The Gulf of Mexico will account for about 18% of this activity or 188 subsea completions during the next three years. Last year, according to a Quest Offshore survey of operators and suppliers, there were about 260 subsea trees installed globally. Several major contract awards for subsea production trees have materialized during the past year-307 in total-which are keeping the world's five main subsea manufacturers utilized. Including the 307 subsea trees booked last year, there are presently 571 pending construction for installation between 2002-07, plus 302 bidding and 219 in the detailed engineering phase. ABB, Cameron and FMC Technologies are dominant suppliers of subsea production hardware to the worldwide market followed by Kvaerner Oilfield Products and Dril-Quip. Each of the manufacturers has strengths in specific regions; however, FMC Technologies has possessed a significant majority of the market during the past year in the Gulf. Meanwhile, ABB has a strong footing in the North Sea, with a 37% market share of trees booked during the last 12 months, along with FMC, which has 32% and KOP at 18%. With respect to the burgeoning African market for subsea trees, Cameron has a favorable market position with a 55% share, following on the heels of several significant ExxonMobil contracts including Kizomba in Angola and Erha in Nigeria. With the award of Shell's deepwater Bonga trees offshore Nigeria in early 2001, ABB will supply about 34 trees to the market or a 33% share of the 104 booked for Africa during the past year. The majority (65%) of identified subsea wells are in deep water. With respect to ultradeepwater subsea production, the present share of subsea trees worldwide in more than 3,437 feet of water (1,200 meters) is 39%. Of the remaining subsea wells forecast, 26% are planned for installation in 1,650 to 3,960 feet (501 to 1,200 meters) of water, and 35% in up to 1,650 feet (500 meters) of water. In the Gulf of Mexico The Gulf ranks second behind West Africa with approximately one-third of the world's estimated deepwater reserves. The great success of deepwater production in the Gulf is due in part to the technological advancements and reliability of subsea production systems. Despite declining oil and gas prices, deepwater and ultradeepwater drilling activity in the Gulf has held up reasonably well. An analysis of Gulf deepwater (in more than 1,000 feet of water) wells drilled during the past two years reveals a 6% composite increase in activity. According to the Minerals Management Service and Quest Offshore estimates, there were 116 deepwater wells drilled in 2001, compared with 109 in 2000. This seems modest, but it is quite steady compared with the measured 9% decline in shallow-water (less than 800 feet) wells drilled in the same period. According to RigZone.com, there are presently eight to nine deepwater drillships under contract in the Gulf-a 50% increase from five to six in 2000. The market for semisubmersibles also has held relatively steady at about 76% utilization with 30 to 32 under contract-up from an average 27 units working in 2000. Ultradeepwater (more than 3,000 feet) Gulf drilling activity experienced an extraordinary gain in 2001 with a 43% increase from 2000 activity. Once these discoveries are commercialized, these projects will be candidates for stand-alone subsea-development schemes or mixed with dry- or wet-tree floating production solutions. Statistics from Quest Offshore's Quest Subsea-Data-Base reveal a six-year forecast for 459 subsea production wells (trees/completions) in the Gulf and Canadian Atlantic waters. This compares with a five-year average of 22 subsea trees or 53 subsea trees in 2001, a robust year. Several major contract awards for subsea production equipment in 2001 have accelerated the pace of activity with 58 booked subsea trees in the Gulf last year for installation during 2001-05. The North American market for subsea suppliers has grown from approximately $600 million during the past six years to an estimated $1.8 billion during the next six years. This market size denotes subsea hardware supply comprising trees, wellheads and controls and excludes costs for flowlines, umbilicals and offshore installation activities. Noble Affiliates Inc. The Houston-based Noble Affiliates (Samedan Oil) Lost Ark development consists of East Breaks 420, 421, 464 and 465 in 2,750 feet (920 meters) of water, connecting to a platform 27 miles (45 kilometers) away at East Breaks 110. Kvaerner Oilfield Products won the contract to supply an electrohydraulic multiplex control system. Platform equipment includes a hydraulic power unit to generate hydraulic pressure for operating the subsea tree valves and manifold valves; a master control station; an uninterruptible power supply; and a topside umbilical termination assembly. Subsea equipment includes a subsea umbilical termination assembly, flying leads and a subsea control module. Samedan Oil inked a letter of intent with Global Industries for its Lost Ark pipeline at East Breaks Block 421. The scope of the project comprises the installation of one 26-mile, six-inch-diameter rigid-steel flowline. The 1,100-ton umbilical (incorporating both super duplex and carbon steel tubes-six in total) will be tied-back to a platform at East Breaks Block 110 in 660 to 700 feet of water. The contract includes saturation diving work and the installation of a new riser at the platform. TotalFinaElf SA. A record-setting deepwater development presently under way in the Gulf is TotalFinaElf E&P USA Inc.'s Canyon Express project. The scope of the work includes a single methanol distribution line and the deepest installed flowlines (two at 12 inches diameter) and electrohydraulic umbilical ever, in up to 7,200 feet of water. Kvaerner Oilfield Products is designing, manufacturing and supplying the subsea controls and a single continuous-length subsea umbilical. The route length initiates from Marathon's Camden Hills prospect (Mississippi Canyon 348) and is then routed to TotalFinaElf's Aconcagua prospect (Mississippi Canyon 305). The pipeline is also linked to BP's King's Peak development (Mississippi Canyon 217) and finally onwards to the Canyon Station platform at Main Pass 261 for termination on the Shelf in 1,132 feet of water. Sonsub Clough Partnership's MSV Maxita (soon to be owned 100% by Saipem) is installing the primary Canyon Express 57-mile (91-kilometer) super-duplex umbilical plus more than 20 kilometers of infield umbilicals. The umbilical system will control four subsea wells at King's Peak, three to four subsea wells at Aconcagua and two subsea wells at Camden Hills. Transocean Sedco Forex's Discoverer Spirit drillship will install and complete the approximately 10 Canyon Express subsea wells. TotalFinaElf estimates completion costs at approximately $21 to $30 million per well. Offshore Africa West Africa is certainly a bright spot for deepwater exploration and development around the globe. It ranks first in estimated deepwater reserves with about a 38% share. West Africa also possesses the world's largest deepwater fields with an average deepwater field size ranking significantly above the rest with Brazil a distant second and the Mediterranean a close third. Quest Offshore estimates a significant 735 subsea wells for Africa and the Mediterranean regions-approximately 29% of the world market. Shell Oil Co. Bonga, the first deepwater development offshore Nigeria, is in 3,609 feet (1,100 meters) of water. Shell Oil awarded the biggest contract to U.K.-based Amec-a $435 million contract to build the process system for the massive Bonga floating production, storage and offloading (FPSO) vessel. The fabrication and assembly of the 225,000-barrel-per-day process deck, expected to weigh in at 17,000 tons, will be centered at Amec's Wallsend yard on Tyneside. The FPSO hull, designed to store up to 2 million barrels of oil, is being fabricated at Samsung in South Korea and is due to arrive in the UK during the third quarter of 2002. Early last year, ABB seized a final $180-million contract for the subsea production hardware. Delivery for the equipment will begin in mid-2002 and carry on through 2009. As a result of the contract, ABB is building a $2-million subsea operations base at Onne. Shell International ordered 29 conventional deepwater trees plus the control system and five manifolds. An added bonus for ABB is supply of the control umbilicals, subcontracted to Kvaerner, and the gas-lift risers. Single Buoy Moorings (UK) Ltd. is executing the main contract for the mooring and installation of the FPSO system. ExxonMobil Corp. Well under way is ExxonMobil's $3.1-billion deepwater Kizomba A development offshore Angola in up to 4,022 feet (1,219 meters) of water. The development scheme for Kizomba Phase 1 incorporates a tension-leg platform plus an FPSO, approximately 32 dry production wellheads, approximately 28 Cameron spool trees for reinjection of the gas into the reservoir, and crude export to a surface buoy. BP Plc. Elsewhere offshore Angola, BP issued prequalification documents for the engineering, procurement, installation and commissioning of umbilicals, flowlines and risers for its Block 18 Greater Plutonio development in 1,300 meters of water. An FPSO, spar or tension-leg platform and multiple-subsea-well development scheme is being evaluated for the multifield development. In the North Sea Quest Offshore forecasts 341 subsea wells in the U.K. North Sea, a mature province which has become increasingly dependent on more numerous, but smaller, fields where subsea developments play a large role. The U.K.'s Oil and Gas Directorate approved a further $244 million in development for Madoes and Mirren using a total of five new wells tied back through multiphase pipelines into the existing central North Sea eastern trough-area project (ETAP) infrastructure. Shell Oil and BP. The Shell-operated 22/23b Madoes will be tapped with three horizontal subsea wells tied to a subsea manifold. Multiphase production will be exported via a 12-mile (19-kilometer) pipeline to the central processing facility within the ETAP complex, which is situated over the Marnock Field. The BP-operated 22/25 Mirren will use two horizontal subsea wells and export via a second subsea manifold and another multiphase pipeline 7.5 miles (12 kilometers) into the system. Oil and gas from the new fields will be exported via the Forties Pipeline and central-area transmission systems. BP expects first production in early 2003. Shell U.K. Exploration & Production. Meanwhile, Shell is developing its Penguin Field, 93 miles (150 kilometers) northeast of the Shetland Islands, with four horizontal wells at a cost of $333 million. Successful results from these wells will result in the drilling of up to five additional horizontal wells, increasing the total investment to $507 million. Penguin's cluster comprises a group of five fields with reserves of oil, gas and condensate estimated at about 90 million barrels of oil equivalent. The Norwegian North Sea sector comprises 311 forecast subsea wells from 2002-07 or 12% of the worldwide total. For 2002, the Norwegian Petroleum Directorate (NPD) sees investment hitting around $5.9 billion, of which spending on production wells will comprise around half of the total and investment in new facilities around 25%. The NPD anticipates a 15% increase in overall spending in 2003 and 2004 to an estimated $6.7 billion annually and sees average spending of $24.7 billion during 2002-05, excluding investments in ongoing operations and exploration. Investments for the most notable development targets include: • Statoil's $4.5-billion Snow White development, for which bids are imminent. • Norsk Hydro's $2.8- to $3.3-billion Ormen Lange development, for which bids are expected to be called either later this year or in 2003, and • BP's $1.6-billion Skarv development, for which bids are expected to be called in late-2002 or 2003. In addition, a number of smaller oil and gas fields such as Svale, Norne expansion, Skirne and Byggve are expected to be developed during 2002-05. Statoil SA. Partners in Norway's Barents Sea Snohvit (Snow White) Field submitted a plan for development and operation to authorities for approval, following tax concessions by the finance ministry. The scope of work comprises pipelines, subsea production facilities, receiving facilities and a gas-liquefaction plant. Field-development work is slated to begin in this spring, with production to be brought onstream in 2006. Contracts in the first phase of the $6-billion Snow White (Snohvit) liquefied natural gas (LNG) project are soon to be issued to fabrication contractors and subsea facilities suppliers. Design work for a newbuild steel barge, measuring 492-by-164-by-30 feet, on which the LNG plant will be built is close to completion, and a contract for the construction of the barge is likely to be awarded during this half. The $500-million-plus facility will accommodate up to 38,580 tons of topsides and can produce up to 203 billion cubic feet of LNG per year. Phase One of Show White will comprise eight subsea production wells and one CO2-injection well. Drilling and completion of these wells will be carried out in 2004 and 2005, with production to start in 2006. A further eight subsea wells for Askeladden and five subsea wells for Albatross are intended for later phases. Requests for quotes for the subsea facilities and 66-mile (106-kilometer) 27-inch-diameter export pipeline from the field are imminent with contract awards anticipated this year or early 2003. Kvaerner Oilfield Products received a letter of intent worth $110 million to provide equipment for 10 subsea wells, production controls and support structures for the Statoil-operated Kristin Field. The scope of work includes the delivery of wellheads, valve-trees and subsea production-control systems for 10 wells plus four, four-slot wellhead templates. Houston-based Kvaerner Oilfield Products will provide high-pressure components for the valve-trees, and Kvaerner in Aberdeen will build control systems. The company will assemble the wells at its Tranby site outside Oslo. The templates will be built at Kvaerner's yard in Egersund, Norway, where it will also undertake integration testing of the wellhead equipment. Elsewhere Quest Offshore forecasts 203 subsea completions during the next six years in the Asia-Pacific region, led by 17 projects in Australia comprising 138 subsea trees and nine projects in Indonesia comprising 72 subsea wells. Woodside, Western Australia Petroleum (Wapet) and BHP Billiton are the most active operators in Australia. Woodside Petroleum plans to invest $2.54 billion in growth projects by year-end 2005, including the Laverda/Enfield oil project by year-end 2002 offshore Western Australia and the Greater Sunrise gas project in the Timor Sea. M Paul Hillegeist is president and co-founder of Quest Offshore Resources Inc., Houston and London, a provider of specialized market intelligence information and consulting services to the offshore oil and gas industry worldwide.