BW Offshore swings to loss

FPSO operator BW Offshore booked a loss for the second quarter of the year but the company is experiencing improved FPSO market activity. 

According to BW’s report on Friday, the company’s operating revenues for the second quarter of 2018 were $200.2 million compared to $163.4 million in the prior-year period.

The company recorded a net loss of $7.5 million for the second quarter 2018 compared to a profit of $5.2 million in the same period last year.

Looking ahead, the FPSO operator said that offshore production of oil and gas is expected to decline after several years of under-investment. This will likely become more evident in coming years, as production tied to investments made in the previous up-cycle has now started and will start to decline. The global balance of crude oil supply and demand has tightened further. Combined with lower break-even costs as a result of increased cost efficiency, this is expected to lead to sanctioning of new projects which will improve the market outlook for offshore field developments, BW said.

Initially, the company expects increased focus on incremental investments to existing infrastructure, while more green-field investments may emerge later in the cycle.

BW Offshore noted it is experiencing improved FPSO market activity as the majority of its fleet remains on long-term contracts with national and independent oil companies.

It is important to note that BW Offshore’s subsidiary, BW Energy, made an oil discovery in the Ruche North East Marin-1 (DRNEM-1) well drilled in the Dussafu Marin PSC, offshore Gabon.

BW’s Dussafu development is progressing according to plan and start- up from the Dussafu field is expected in late September or early October this year.

Offshore Energy Today Staff