M3 - Asian OSJSubsea 2015

Panel Discussion Country-specific finance challenges and opportunities in

subsea sector

Mike Meade, M3 Marine Group

Asian Offshore Support Journal Subsea Conference Singapore 18 & 19 March 2015

M3 MARINE GROUP PTE LTD1 Commonwealth Lane, #09-19, ONE Commonwealth, Singapore 149544 T +65 6327 4606 M [email protected] W www.m3marine.com.sg All rights reserved.

• E & P spending down

• We saw signs of this as early as Q1 2014

• Demand for subsea services is down in 2015 and 2016 which coupled with increasing supply is a problem for the industry

• Oversupply will leave some Owners exposed, especially in commoditised tonnage (ie ROV support)

• One glimmer of hope could be a drive towards consolidation leading to market discipline

Setting the scene……


Setting the scene (2)……

Demand growth still apparent in Mexico and Brazil… but…

Neither place is easy to work, Brazil especially so

Project lead times have increased, caused by delays introduced by the oil price ‘shock’

It is estimated we will not see activity levels reach 2014 levels until at least 2017

Big Oil starting running out of cash BEFORE the decline in the oil price


Setting the scene……

It’s not just about the oil price….

• The drop in the oil price is compounded by a massive increase in costs across the E&P industry

• The O&G industry has ‘lunacy’ levels of costs associated with it

• We have all witnessed the knee jerk reaction as big oil gets its red pen out


How is the market reacting ?


A ray of hope..?

Often asked what I would invest in.

I have invested in the Subsea ‘true’ DSV space.

Only 10 ‘true’ DSV’s being built in the world

2 of these are about to be cancelled (whose you may ask !)

Graphic courtesy of


A ray of hope..?

THE END

Asian Offshore Support Journal Subsea Conference Singapore 18 & 19 March 2015

M3 - Asian OSJSubsea 2015

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Transcript of M3 - Asian OSJSubsea 2015