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%.

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