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Report: U.S. Gulf of Mexico Has Largest Number of Laid-Up OSVs

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Graphic courtesy VesselsValue

By MarEx 2019-04-16 18:57:47

Out of all the major offshore oil and gas regions, the U.S. Gulf of Mexico has the largest number of laid-up OSVs, according to a new analysis by VesselsValue. 

"By observing the figures, we can see the market with the highest layup is the US Gulf.  Even with the increased scrapping seen in this region the US Gulf is still suffering, especially within the OSV and OCV sector," said VesselsValue head of offshore Robert Day in a recent statement.

The U.S. offshore vessel segment has experienced multiple bankruptcies and mergers since the oil sector downturn began in 2014. Large operators have sought to deleverage and gain scale to offset the challenging market conditions, leading to a wave of consolidation. Tidewater and Gulfmark both went through Chapter 11 bankruptcy in 2017, then merged when Tidewater bought Gulfmark for $340 million in 2018. Competitor Harvey Gulf also emerged from bankruptcy last year.

VesselsValue assesses that an OSV is in layup when it has not broadcast AIS activity in eight weeks. Based on this evaluation method, 390 OSVs, 76 offshore construction vessels and 13 MODUs are laid up in the Gulf of Mexico - a reflection of the continued low level of offshore drilling activity in the region. The OSV layups constitute 38 percent of the total supply. 

"At the other end of the spectrum is Northwest Europe, with a layup at 14 percent for OSVs. We have recently witnessed several North Sea owners reactivate vessels due to increased sentiment and opportunity in the region," said Day.