Oil and Gas Breakbulk & Project Cargo
Stream of oil and gas business keeps project sector humming
By Keith Wallis
Reports of the demise of fossil fuels — and , by extension , the oil and gas project cargo market — may have been exaggerated or , at the very least , a bit premature .
Flouting predictions of a slowdown in exploration and production as the world transitions to more environmentally friendly energy sources , oil and gas projects are continuing alongside renewable energy generation , fueling strong cargo demand , according to engineering , procurement and construction firms ( EPCs ), forwarders , and ocean carriers .
“ We have seen quite a bit of activity this year from both traditional offshore oil and gas and renewable projects ,” Peter Hansen , president of Cosco Shipping Heavy Transport , told the Journal of Commerce . “ We have signed many forward contracts of both types this year .”
During the Breakbulk Americas conference in Houston in October , oil and gas-focused cargo owner , forwarder and carrier executives described the environment as “ robust ” but “ challenging ,” even “ chaotic .”
“ We have seen quite a bit of activity this year from both traditional offshore oil and gas and renewable projects .”
Chevron
While projects are picking up for all sectors , the trend favors relatively small projects , upgrades and expansions , one project forwarder who asked not to be identified said during the event . He singled out the US oil and gas market as “ definitely moving ,” while South America is a busy area for both oil and gas and power generation .
He said shippers and carriers are now actively engaging with forwarders , whereas before they were making loose enquiries , another sign that planned projects are starting to move from the drawing board to the real world .
“ We are having more ‘ real ’ conversations — more tangible discussions — and engagement with carriers , although they are still conservative about commitment ,” the forwarder told the Journal of Commerce .
Global capital spending on oil and gas generation — a major source of heavy and oversized project cargo — is expected to increase 20 % year over year in 2024 and a further 13 % in 2025 , according to S & P Global Commodity Insights . S & P Global is the parent company of the Journal of Commerce .
With renewable energy generation still augmenting , rather than replacing , traditional sources , oil demand is www . joc . com November 2024 | Journal of Commerce 11