Offshore Decommissioning Market Is Estimated to Witness High Growth Owing to Rising Global Energy Consumption
Offshore decommissioning involves dismantling offshore oil and gas infrastructure and facilities at the end of their productive lives. This includes plugging and abandoning wells, removing structures above and below water, and removing platforms and pipelines. The global offshore industry continues to mature, with many fields in the decommissioning phase of their lifecycle. With aging assets and increased regulation around decommissioning, the offshore decommissioning market is expected to grow significantly over the next decade.
The global offshore decommissioning market is estimated to be valued at US$ 7.07 Bn in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
Rising global energy consumption is one of the key drivers propelling the growth of the offshore decommissioning market. According to the U.S Energy Information Administration, global energy consumption is projected to grow by nearly 50% between 2018 and 2050 worldwide. This rapid increase in demand for oil and gas is expected to lead to the increased investment in the development of new offshore fields, which will subsequently increase the volume of offshore infrastructure reaching the end of operational life over the next few decades.
Higher energy consumption is driving more exploration, production and infrastructure investment in the offshore oil and gas sector. This is leading to the establishment of aging assets that will require proper and responsible decommissioning in the future. Regulations around decommissioning of offshore oil and gas structures are also becoming more stringent to minimize environmental impact, ensure safety and inform future infrastructure development. These factors are expected to contribute significantly to the growth of the offshore decommissioning market size over the forecast period.
SWOT Analysis
Strength: The offshore decommissioning market is expected to grow significantly in the forecast period due to growing requirement to decommission aging offshore infrastructure. Stringent government regulations regarding the abandonment and decommissioning of offshore assets are also encouraging market growth. Availability of advanced technologies such as robotics is helping players provide decommissioning services efficiently.
Weakness: High initial costs associated with decommissioning projects can restrict market growth. Lack of expertise and standardized regulations in some regions also poses challenges. Uncertainties regarding liability issues after asset relinquishment pose risks.
Opportunity: Growing decommissioning of assets in deep waters and harsh environments will drive demand for specialized vessels and equipment. Supportive government policies and tax incentives for decommissioning are encouraging investments. New players can leverage opportunities in emerging markets in Asia Pacific and Middle East regions.
Threats: Fluctuations in crude oil prices impact investments in the oil & gas industry. This may lead to delays or cancelation of planned decommissioning projects. Strict environmental norms increase compliance costs. Competition from alternative energy sources can reduce future exploration and production activities.
Key Takeaways
Global Offshore Decommissioning Market Size is expected to witness high growth in the forecast period from 2023 to 2030 owing to the large number of aging offshore infrastructure and assets requiting decommissioning. The growth is estimated to be at a CAGR of 12% during the forecast period.
The offshore decommissioning market in Europe region currently dominates with over 30% market share due to stringent government regulations and a large number of mature oilfields in the North Sea requiring decommissioning. Major projects are ongoing or planned in the UK, Norway and Netherlands. The Asia Pacific region is expected to grow at the fastest pace owing to upcoming decommissioning of offshore projects in China, Indonesia, Malaysia and Australia.
Key players operating in the offshore decommissioning market are GlaxoSmithKline Plc., Sanofi SA, Bharat Biotech, Bio-Med Pvt. Ltd., PT Bio Farma, PaxVax, Inc. Shanghai Institute of Biological Products Co., Ltd., and Prokarium. These players are focusing on expanding service capabilities and technological advancements to strengthen their market position.
Get More Insights on this topic- https://www.zupyak.com/p/3965994/t/offshore-decommissioning-market-growth-accelerated-by-reusing-and-recycling-of-materials
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