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Contractors hit as spending falls

Posted on 02.12.2009 - 03:53 UTC in GENERAL NEWS by Rons_ROV_Links

Contractors hit as spending fallsCapital expenditure on oil and gas developments is expected to fall 23% this year, with the majority of contractors expected to bid low amid deflationary pressures and a growing urgency to arrest a decline in order backlogs.


Despite a September quarter increase of 21.3% and two consecutive quarters of growth in new orders, contractors continue to struggle to replenish backlog levels, an ODS-Petrodata analyst said.

New orders this year are expected to be around 70% of last year’s as international oil companies hold back on project sanctions after a drastic plunge in commodity prices in the second half of 2008.

Only a handful of contractors surveyed including Hyundai Heavy Industries, Aker Solutions Subsea, JGC, Technip, Acergy and Subsea 7, are beneficiaries of large but fewer contracts awarded over the last two quarters.


Read the complete article on Upstreamonline.com

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