Deepwater Growth Hinges on New Investment and Emerging Technologies

Deepwater production remains a crucial part of the long-term energy supply mix. According to Welligence, global deepwater oil production will grow from around 8 million barrels per day (MMbbl/d) to close to 10 MMbbl/d by the early 2030s.

However, post-2035, deepwater production is set to decline unless a new batch of pre-FID (final investment decision) projects is developed in the medium to long-term. To achieve this growth trajectory, a significant increase in investment is required, especially from international oil companies (IOCs).

IOCs are applying strict criteria for new investments and focusing on commercially attractive deepwater projects. New developments are being assessed through a carbon lens as part of project screening, with emission reductions built-in rather than added as an afterthought.

A key challenge is the high capital required for FPSO (floating production storage and offloading) topside costs, estimated to be between $50,000 and $60,000 per tonne. Emerging technologies such as moving processing equipment subsea could reduce emissions while cutting topside weight requirements, but potential costs and system reliability will be crucial to adoption.

Digitization and artificial intelligence (AI) are increasingly being used to streamline operations, with benefits including reduced process downtime by up to 30% and opex savings of between 10 and 20%. Early adopters such as bp and Shell in the Gulf of Mexico are paving the way for industry-wide adoption.