Saudi Arabia Offshore Support Vessel (OSV) Market Size, Share & COVID-19 Impact Analysis, By Vessel Type (Anchor Handling Tug Supply Vessel (AHTS), Platform Supply Vessel (PSV), Crew Vessel, Tug Boats, and Others), By Water Depth (Shallow Water, Deep Water, and Ultra-Deep Water), By Application (Oil & Gas, Offshore Wind, Offshore Desalination Plant, Patrolling, Research & Surveying, and Others), and National Forecast, 2021-2028

The Saudi Arabia offshore support vessel (OSV) market size was USD 0.68 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with offshore support vessels witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the Saudi Arabia OSV market exhibited a significant decline of -23.6% in 2020. The market is projected to grow from USD 0.72 billion in 2021 to USD 1.21 billion in 2028 at a CAGR of 7.6% in the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

Offshore support vessels or OSVs are a type of specialized ship utilized to seamlessly conduct operations on various platforms located across the mid-sea areas. Continuous efforts to harness the potential of offshore assets by constructing new non-renewable and renewable energy infrastructure are set to be a major catalyst for the Saudi Arabia OSV market. The increasing exploration of shallow, deep, and ultra-deep sea reserves requires a large amount of machinery and personnel transportation, generating demand for different scale supporting units.

COVID-19 Impact

Diminished Oil & Gas Demand and Investment to Impede Market Growth amid COVID-19 Pandemic

The abrupt increase in the number of patients struck with the COVID-19 viral infection has adversely influenced the economic stature of various nations. The governments have introduced stringent policies and guidelines to contain the spread of novel coronavirus strains. Consequently, the Saudi Arabia offshore support vessel market growth is set to observe a significant setback owing to the implementation of lockdowns across the industrial operations, deteriorating hydrocarbon requirements, negative energy demand, and inhibited project investments.

Furthermore, the supply chain constraints hindering the delivery of vessels between different regions hampering the industry landscape. Also, a steep decrease in the overall energy intake in residential, commercial, and industrial verticals all across the globe is one of the key factors impacting the market size. For instance, as per the Statistical Review of World Energy 2020 published by the energy giant British Petroleum (BP) in June 2020, the global primary energy consumption totaled 556.63 exajoules in 2020, decreasing by -4.5% from 581.51 exajoules in 2019. The report also stated that the oil production from Saudi Arabia contracted by -6.7% between 2019 and 2020. In contrast, South America or Latin America experienced the maximum yearly natural gas output decline of -11.5% in 2020, dramatically influenced by the COVID-19 pandemic.

LATEST TRENDS

Discovery of New Bulk Reserves to Play a Vital Role in Expanding Industry Landscape

Increasing drilling & exploration activities by different key players to unveil new high potential oil and gas reservoirs in the offshore environment to stimulate the Saudi Arabia offshore support vessel market. For instance, in December 2020, the national hydrocarbon giant Saudi Aramco uncovered four oil & gas sites in offshore waters. The Saudi Arabian Minister of Energy stated that unconventional oil and gas reserves were discovered across the Al-Reesh oil field and Al-Minahhaz well in the kingdom’s territorial waters.

New Collaborative Initiatives by Industry Participants to Propel the Market Growth

Different companies have introduced various short and long-term plans to conduct extensive research and surveying activities in different water depths. For instance, in October 2017, a Saudi Arabia-based support services provider, Zamil Offshore Services, announced a strategic partnership with UTEC, an Acteon company, to conduct new survey projects in the kingdom. The two organizations aim to expand their presence in the kingdom with a diversified portfolio for marine and offshore construction activities.

DRIVING FACTORS

New Offshore Projects to Favor OSV Demand

Saudi Arabia has emerged as one of the major oil & gas producers and exporters across the globe. Besides, the exploration & production companies are favored by the presence of less complex formations leading to the diminished overall cost associated with drilling rigs in onshore and offshore reserves propelling this market. Additionally, a paradigm increase in the rate of development to build new infrastructure is likely to lead to the adoption of new energy generation methods such as hydrocarbon fuels and renewable wind power.

Encouraging Policies by Key Organizations to Aid Market Growth in the Country

Various regional and global players & organizations are adopting significant measures to counterbalance the demand fluctuations stimulating the Saudi Arabia offshore support vessel market. For example, in July 2021, the Organization of the Petroleum Exporting Countries (OPEC) and its partner nations have introduced a new objective to control international crude prices in the post-COVID world. The organization planned to cut down the hydrocarbon output by 10 million barrels per day (Mbpd) to sustain during the pandemic fluctuations. However, it recently lifted the ban and further boosted production by 2 Mbpd between August and December 2021 to fortify the market.

RESTRAINING FACTORS

High Capital Expenditure along with Volatile International Crude Oil Prices May Obstruct the Market Pace

The building of new support vessels needs a large capital investment coupled with precise technical expertise to cater to the specific requirements based on the water depth and maneuverability. Furthermore, the assembled offshore supply vessels entail a dedicated large-scale infrastructure for constructing and holding the units. Additionally, the global crude oil prices are highly susceptible to sudden fluctuations caused by the altering supply-demand gaps. They can significantly affect the offshore E&P operations hindering the Saudi Arabia offshore support vessel market.

SEGMENTATION

By Vessel Type Analysis

Anchor Handling Tug Supply Vessel (AHTS) is Likely to Dominate the Industry Size

This market can be broadly categorized based on vessel type into anchor handling tug supply vessel (AHTS), platform supply vessel (PSV), crew vessel, tug boats, and others. AHTS segment is anticipated to hold the leading position during the forecast period owing to their reliable & sturdy designs to transport heavy loads across different water depths. Additionally, the steadily increasing requirement of logistics transfer coupled with the shifting of advanced equipment and tools is set to complement the platform supply vessel (PSV) segment outlook.

Tug boats are also projected to observe a substantial growth rate owing to their powerful & multi-functional designs with the ability to perform efficiently in port and near-shore activities. Furthermore, essential need to transfer working personnel to and from structures in various sea depths to favor the crew boat segment growth.

By Water Depth Analysis

Shallow Water to Observe Significant Expansion

This industry can be broadly trifurcated into shallow, deep, and ultra-deepwater based on water depth. The availability of hydrocarbon reservoirs in the nearshore continental shelves and plans to build new offshore wind farms to augment the shallow water segment size. Additionally, the growing placement of semi-submersible rigs in more profound depths of up to 1,500 meters can produce hydrocarbon in bulk quantities to favor the deepwater segment growth. The ultra-deep segment size is backed by the deployment of large-scale Floating Production Storage and Offloading (FPSO) vessels requiring reliable anchoring and mooring services.

By Application Analysis

New Investments in Exploring Renewable Generation Capabilities to Favor Offshore Wind Segment Demand in Long-Term

Based on application, the market is divided into oil & gas, offshore wind, offshore desalination plant, patrolling, research & surveying, and others. Oil & gas application is projected to account for the lion’s share in the national industry landscape. This factor is due to the regular discovery of new reserves with growing investments across present structures in various depths. Encouraging policy framework to reduce the dependency on fossil fuels and explore new technologies with high installation potential is set to complement the offshore wind segment size.

Additionally, the research & surveying application vertical is supported by the uninterrupted efforts to study and analyze geographical structures to minimize the risks from natural & unnatural calamities. The growing need for surveillance activities, especially near the marine borders, and an emergency need for rescue vessels are likely to add to the size of the patrolling segment.

REGIONAL INSIGHTS

The market has been analyzed across Saudi Arabia to exhibit precise insights based on various segments. The market was estimated at USD 0.68 billion in 2020 and will observe significant growth over the forecast period. Rapidly growing energy demand, shift towards new green wind power technology, the discovery of new reserves, and investments in prevailing assets are some of the key factors boosting the national landscape.

KEY INDUSTRY PLAYERS

SEACOR Marine is Focusing on Initiating New Organic and Inorganic Expansions to Strengthen its Position

Numerous players operate across Saudi Arabia's offshore support vessel market, with offerings delivered at the national, regional, and global levels. The market participants strive to present advanced design and structure of supply vessels with the ability to withstand harsh conditions and enhance their presence across the value chain.

SEACOR Marine Holdings Inc., a global marine service provider for offshore hydrocarbon and wind power facilities, expands its fleet portfolio and geographical footprint through different expansion strategies. For instance, in June 2020, the company announced its acquisition of the remaining 50% in its joint venture called SEACOSCO Offshore LLC. The consolidation of SEACOSCO will enable SEACOR to include eight Rolls-Royce-designed PSVs with six vessels integrated with a battery energy storage system to magnify SEACOR’s horizon globally.

LIST OF KEY COMPANIES PROFILED

• Zamil Offshore Services Company (Saudi Arabia)


• Makamin Offshore Saudi Ltd. (Saudi Arabia)


• Hadi H Al Hammam Est (Saudi Arabia) 


• Aramco (Saudi Arabia)


• Bumi Armada (Malaysia)


• Britoil Offshore Services Pte Ltd (Singapore)


• SEACOR Marine Holdings (U.S.)


• Tidewater (U.S.)


• Jana Marine Service Company LLC. (Saudi Arabia)


• VM Marine International Ltd. (UAE)


• Bin Nowiran Establishment (Saudi Arabia)

KEY INDUSTRY DEVELOPMENTS

• April 2021 – Eidesvik, a Norwegian shipping company, announced to upgrade Acergy Viking, the company’s offshore wind support vessel, to equip hybrid propulsion and battery pack system. The company aims to diminish the carbon footprint of its fleet by half by 2030 and completely by 2050.


• December 2020 – Havila shipping declared to attain a three-year contract to supply platform supply vessels (PSVs) from Equinor. The total value for the agreement was estimated to be close to USD 90 million with seismic support operations.

REPORT COVERAGE

The market research report provides detailed information regarding various insights into the market. Some of them are growth drivers, restraints, competitive landscape, geographical analysis, and challenges. It further offers an analytical depiction of the offshore support vessel market trends and estimations to illustrate the forthcoming investment pockets. The market is quantitatively analyzed from 2021 to 2028 to provide the financial competency of the market. The information gathered in the report has been taken from several primary and secondary sources.

Report Scope & Segmentation