Offshore Support Vessel Market

[316 Pages Report] The global offshore support vessel market in terms of revenue was estimated to be worth $25.6 billion in 2024 and is poised to reach $36.3 billion by 2029, growing at a CAGR of 7.2% from 2024 to 2029. Government policies and regulations are pivotal drivers shaping the market for offshore support vessel, particularly in the context of addressing pressing environmental challenges and advancing sustainable transportation agendas. Across the globe, governments are increasingly recognizing the urgent need to curb greenhouse gas emissions and mitigate the impacts of climate change. In response, they are enacting stringent regulations aimed at reducing vehicle emissions and promoting the adoption of low-emission alternatives.

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Offshore Support Vessel Market Dynamics

Driver: Increasing investments in offshore wind and oil & gas projects

The world's escalating population is a significant driver of global energy requirements, anticipated to climb from 8 billion in 2022 to 8.5 billion by 2030, as projected by the UN World Population Prospects. To cater to this surge in energy demand, a diverse array of energy sources—ranging from thermal and nuclear to renewable, oil, gas, and electricity—is essential. Notably, the offshore support vessel market experiences growth propelled by the demand for drilling and production activities stimulated by the discovery of substantial untapped oil reserves, as evidenced by the 1,729.7 billion barrels of oil remaining undiscovered globally in 2018, according to the BP Statistical Review of 2019.

Furthermore, regions with pronounced energy demands, such as the Asia Pacific, are gearing up to enhance their offshore production capacities. Countries like India and China, endowed with offshore oil and gas basins in the Indian Ocean and South China Sea respectively, hold immense potential for offshore exploration activities. Besides the Asia Pacific, notable discoveries are also being made in the offshore regions of Africa, particularly in the western African territories.

Restraint: Constant fluctuations in oil prices and requirement for huge capital to launch offshore support vessels

Oil prices wield significant influence over the demand for Offshore Support Vessels (OSVs), as they impact the economics of oil and gas operations. Fluctuations in oil prices directly affect the installation costs and profitability of oil and gas ventures. The day rates charged for OSVs are intricately linked to oil prices, necessitating substantial capital investment for the deployment of new vessels. The cyclical nature of oil prices can be attributed to fluctuations in crude demand and the production levels of both OPEC and non-OPEC nations.Furthermore, competition within the oil and gas market, particularly between the US and OPEC countries, along with the emergence of shale gas, has led to a surplus in supply, contributing to the downward pressure on oil prices. The drastic drop in crude prices, halving since June 2014, compelled oil companies to curtail their expenditures, leading to contract delays or cancellations with OSV providers, thereby dampening the uptake of these vessels.

Oil prices have exhibited volatility since the 2014 decline, with a downward trend until 2016, followed by a resurgence in 2017 and 2018, driving demand for production enhancement endeavors. However, prices experienced a dip again in 2019 and 2020, with a marginal uptick observed in the first quarter of 2021.

Opportunities: Increased ultra-deepwater exploration activities, especially in Arctic region

Oil and gas operators are aggressively venturing into uncharted territories, particularly ultra-deepwater regions like the Arctic, in pursuit of new reserves. In 2008, the Circum-Arctic Resource Appraisal (CARA) conducted by the US Geological Survey unveiled staggering estimates: 90 billion barrels of oil, 1,669 trillion cubic feet of natural gas, and 44 billion barrels of natural gas lie potentially within 33 Arctic provinces, with a substantial 84% of these reserves situated offshore. Moreover, the Arctic is believed to harbor approximately 30% of the world's undiscovered gas and 13% of its undiscovered oil resources, as per the US Geological Survey. Such monumental figures necessitate significant investments in the Arctic's exploration and extraction endeavors.

A closer examination by the US Geological Survey reveals that over 70% of these undiscovered oil resources are concentrated in five key provinces—Arctic Alaska, the Amerasia Basin, the East Greenland Rift Basins, the East Barents Basins, and West Greenland–East Canada. The Arctic, witnessing substantial petroleum resource development in recent decades, presents a lucrative landscape for offshore drilling service providers. Offshore drilling services play a pivotal role in navigating the intricate topography of lesser-known Arctic regions, making them indispensable for oil and gas activities in this challenging environment. Anticipated growth in demand for Anchor Handling Tug Supply (AHTS) vessels in the Arctic by 2020 underscores the burgeoning opportunities in this region.

Challenges: Stringent regulations for offshore activities

Government regulations concerning oil and gas field development are progressively tightening, posing challenges for the market. This market is characterized by fragmentation and local dominance. Cabotage laws, which regulate shipping and offshore activities within a country's waters, underscore the authority of nations to restrict the operations of foreign vessels within their maritime boundaries. These laws, unique to each country, aim to bolster the participation of local players.

In the Bahamas, cabotage legislation prioritizes job creation for the local populace, while Brazil has enacted several cabotage laws to bolster its domestic industry. Despite these regulatory efforts, the offshore sector in Brazil grapples with meeting Petrobras’ exploration and production (E&P) objectives. Malaysia's Petroleum Development Act and Petroleum Regulations mandate that all offshore support vessel service providers must possess a valid license issued by Petronas Malaysia.

Offshore Support Vessel Market Ecosystem

In this market, prominent companies stand out as well-established and financially stable providers of offshore support vessel. With years of experience, these companies boast a diverse product portfolio, cutting-edge technologies, and robust global sales and marketing networks. Their proven track record in the industry positions them as reliable and trusted partners for customers seeking offshore support vessel. These companies have demonstrated their ability to adapt to market dynamics and consistently deliver high-quality products and services, making them leaders in meeting the demands of the energy and power sector. Prominent companies in this market A.P. Moller - Maersk (Denmark), Tidewater Inc. (US), BOURBON (France), Edison Chouset Offshore (US), and Deltamarin Ltd (Europe).

The multipurpose support vessel, by type, is expected to be the fastest growing market during the forecast period.

Multipurpose support vessels (MSVs) are essential for operations in remote and harsh environments, such as deepwater locations, Arctic regions, and ultra-deepwater fields. These vessels are designed with advanced technology and robust construction to withstand extreme conditions like severe weather, high seas, and icy waters. In deepwater locations, MSVs utilize dynamic positioning systems and specialized equipment to perform tasks like drilling and pipeline laying with precision and safety at significant depths. In the Arctic, MSVs are equipped with ice-class hulls, reinforced structures, and winterization measures to navigate ice-covered waters and extreme cold, supporting oil and gas exploration, environmental monitoring, and research. Ultra-deepwater operations benefit from MSVs' cutting-edge technology and high-capacity equipment, which handle immense pressures and technical challenges, ensuring efficient and safe subsea installations and production activities.

By end-user, offshore wind is expected to be the second largest growing segment during the forecast period.

This report segments the offshore support vessel market based on end-user into two segments: offshore oil & gas and offshore wind.  Enhanced operational and maintenance (O&M) strategies, including predictive maintenance and remote monitoring technologies, have improved the reliability and longevity of offshore wind turbines. This reduces downtime and maintenance costs over the lifespan of the project.

North America: The fastest growing region in the offshore support vessel market.

North America is expected to be the fastest growing region in the offshore support vessel market between 2024–2029. Stringent environmental regulations and the growing push for sustainability in offshore operations are significantly reshaping the offshore support vessel (OSV) market. Governments and international bodies are implementing increasingly rigorous environmental standards aimed at minimizing the ecological impact of offshore activities. These regulations cover various aspects, from emissions and waste management to the protection of marine biodiversity.

Key Market Players

The market is dominated by a few major players that have a wide regional presence. The major players in the offshore support vessel market include A.P. Moller - Maersk (Denmark), Tidewater Inc. (US), BOURBON (France), Edison Chouset Offshore (US), and Deltamarin Ltd (Europe).  Between 2020 and 2024, Strategies such as new product launches, contracts, agreements, partnerships, collaborations, acquisitions, and expansions are followed by these companies to capture a larger share of the market.

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Scope of the Report

This research report categorizes the Market based on materials used, fuels used, type, application, end-user and region.  

On the basis of materials used, the Offshore support vessel market has been segmented as follows:

• Offshore support vessel materials
• Cladding materials

On the basis of fuels used, the Offshore support vessel market has been segmented as follows:

• Fuel oil
• Liquified natural gas (LNG)

On the basis of type, the offshore support vessel market has been segmented as follows:

• Volume-and value-based market analysis
• Anchor-handling tug supply vessels
• Platform supply vessels
• Multipurpose support vessels
• Standby & rescue vessels
• Crew vessels
• Seismic vessels
• Chase vessels
• Other vessels

On the basis of application, the offshore support vessel market has been segmented as follows:

• Shallow water
• Deepwater

On the basis of end-user industry, the offshore support vessel market has been segmented as follows:

• Offshore oil & gas
• Offshore wind

Based on region, the offshore support vessel market has been segmented as follows:

• North America
• Europe
• Asia Pacific
• RoW

Recent Developments

• In May 2024, Edison Chouest Offshore has announced the acquisition of ROVOP, a prominent remotely operated vehicle (ROV) company. This acquisition, combined with Chouest's subsea service company, C-Innovation, significantly expands their capabilities, now boasting a fleet of over 100 ROVs and 6 autonomous underwater vehicles (AUVs). Integrating ROVOP into the Chouest family not only broadens Chouest's service portfolio but also provides ROVOP with access to greater resources. ROVOP will benefit from the support and expertise of other Chouest companies, including vessel-based operations, Caltex Oil Tools, Bram Offshore, and C-Innovation. This synergy will enable ROVOP to better serve its existing clients and attract new business with an expanded range of services. This acquisition is a strategic move to enhance Chouest's integrated subsea services, demonstrating its commitment to advancing its technological capabilities and service offerings globally. Chouest looks forward to this new chapter with ROVOP, strengthening its leadership position in the subsea services industry.
• In May 2024 Deltamarin and ECOLOG have jointly developed a new design for an LCO2 carrier, aimed at tendering at shipyards globally. This design focuses on intra-EU, short-range, low-pressure, and shallow draft specifications. It incorporates LNG dual-fuel propulsion, shore power (AMP), and wind assistance, all of which contribute to minimizing the vessel's environmental footprint.
• In February 2024, Deltamarin and BAR Technologies have unveiled their new wind-optimized hull design, showcasing their commitment to decarbonization and innovative progress. The co-developed Aframax/LRII design, named Aquilo, marks a significant advancement in performance by combining advanced hull design with WindWings technology. The design features aerodynamic optimization through the strategic positioning of four WindWings and the AeroBridge, an aerodynamically superior deckhouse design. The hull’s main dimensions and characteristics have been tailored for optimal operation with substantial wind assistance, leading to a notable improvement in fuel efficiency.

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