![](/sites/default/files/styles/hart_news_article_image_640/public/image/2019/02/new-construction.jpg?itok=i4qEyztb)
Newbuild production capacity from projects onstream in 2017 is reaching a peak. More than 60 projects with total newbuild capacity of 6.3 million barrels of oil equivalent per day (MMboe/d) are expected to reach their first production this year.
The newbuild capacity was 4.9 MMboe/d on 54 projects in 2016. Looking forward, 2018 will only see about 4.1 MMboe/d of new capacity on 33 projects, and 3.6 MMboe/d on 43 projects in 2019. The trend indicates that the gluts of projects sanctioned in the high-price era will be subdued after this year.
Among the projects starting in 2017, 52% of the total capacity is liquids production, down from 59% in 2016. The trend will continue as the liquids capacity will be 48% in 2018 and only 41% in 2019.
Oil capacity expansion
The Middle East is dominating on new capacity additions in 2017 with 1.5 MMboe/d, where 70% (1 MMboe/d) is oil. There are several large projects with capacities of more than 100,000 bbl/d coming online this year in the UAE and Saudi Arabia. South East Full Field developments, UZ250 and SARB projects, all three in the UAE, have a combined oil production capacity of about 500,000 bbl/d. Saudi Arabia’s Khurais expansion project will add 300,000 bbl/d of capacity.
Latin America, mainly Brazil, will have four FPSOs in operation this year. Each one has an oil production capacity of 150,000 bbl/d. Two of the floaters will be on pre-salt Lula Field (Lula Sul and Lula Norte), another on pre-salt Buzios Field (Buzios 3) and the fourth in the Tartaruga Verde and Mestica developments.
Other notable oil projects coming online this year include: the Hebron heavy oil project offshore Canada with 150,000 bbl/d, the 160,000-bbl/d Canadian oil-sands mining project Fort Hills Phase 1, the Schiehallion Quad 2014 project built with an FPSO with 130,000 bbl/d oil production capacity in the U.K. North Sea, the Moho Nord project offshore Congo with an FPSO with a capacity of 100,000 bbl/d and the Yurubcheno-tokhomskoye development onshore Russia with a new capacity of 100,000 bbl/d.
Gas capacity expansion
In Africa, 72% of the 1.2-MMboe/d newbuild capacity is gas, driven by two major projects: the Zohr project offshore Egypt with a capacity of 2.7 billion cubic feet per day (Bcf/d) and the Touat project onshore Algeria with a capacity of 425 MMcf/d.
In Asia-Pacific, 80% of the 1.1-MMboe/d newbuild capacity is gas. The boost of gas production mainly comes from two LNG projects: Ichthys (Australia), with 1.1 Bcf/d, Wheatstone (Australia), with 1.5 Bcf/d, and the North Malay Basin integrated gas development in Malyasia, with 425 MMcf/d.
Other notable gas projects coming online this year include Yamal LNG in Russia with a capacity of 2.4 Bcf/d, the Khazzan tight gas project in Oman with a capacity of 1 Bcf/d and the Juniper gas field development offshore Trinidad and Tobago with a capacity of 590 MMcf/d.
Offshore shallow-water dominance
Offshore shallow-water projects are the dominant force of the 2017 projects, which count for about 42% of the new-build capacity, followed by deepwater projects, which count for 30%. Onshore projects count for the remaining 28%.
Recommended Reading
Mexico’s Nearshoring Attracts $36B in Investment as US Energy Benefits
2024-07-03 - Mexico saw the highest level of foreign investment in 18 years as companies were attracted to low wage workers, but U.S. energy producers, among others, continue to fuel power for the country’s new factories and projects.
Williams Wins Latest Louisiana Court Battle with Energy Transfer
2024-07-03 - Williams and Energy Transfer, at loggerheads over pipeline rights of way, are also awaiting a FERC ruling over the Louisiana Gateway Project.
Oil Prices Up Slightly as US Crude Oil Inventories Fall
2024-07-03 - The U.S. Energy Information Administration reported a 12.2 million draw in the country's crude oil barrels in storage last week.
EIG Refinances $11B in Senior Debt for Aramco Pipeline Deal
2024-07-03 - EIG subsidiary Pearl Pipelines will use the proceeds to repay financing related to its $25.3 billion acquisition of 49% interest in Aramco Oil Pipelines Co. three years ago.
Nuclear in a Box: Mobile Nuclear Reactors May Answer Permian’s Power Ask
2024-07-03 - A top Permian producer has signed up for a small-footprint nuclear plant. A top pressure-pumper has invested in the developer. Industry members say interest in Permian nuclear is hot.