Charter rates for platform supply vessels (PSVs) are forecast to jump substantially in the North Sea spot and term-contract markets as vessels leave the region to support international projects
Oslo, Norway-listed vessel owner Standard Supply expects rates for PSVs to reach all-time highs in the North Sea in 2024. Charter rates are already on the march with expectations term-charter prices will continue climbing during the rest of this year.
Standard Supply achieved time charter equivalent (TCE) earnings of US$16,900 per day and fleet utilisation of 94% in August 2023. Standard Supply chairman of the board Martin Nes expects average daily rates of US$19,400 per day from its charters during Q4 2023.
Rates for contract renewals are already far higher. On 1 September, Standard Supply’s 2008-built PSV FS Balmoral commenced a two to three-month contract at US$34,000 per day off Germany.
“We anticipate seeing new all-time highs set in the North Sea in the coming year,” said Mr Nes. “In the upcoming weeks, six large-sized PSVs will leave the North Sea for work internationally. This will leave fewer than 170 vessels in the region, marking a decline of approximately 100 vessels from the high in 2016-2017 and about 30 less than in 2021.”
Vessels are heading to support oil and gas projects in west Africa and South America from the North Sea, reducing availability at a time when energy companies are planning to ramp up field developments and drilling off northern Europe.
“As the contracting season for 2024 now unfolds, the reduced capacity’s impact is evident,” said Mr Nes. “We are witnessing less competitive bidding and heightened rate expectations from vessel owners. Our strategy leans towards long-term charters over spot market deals.”
Standard Supply sold 2012-built Standard Duke to new owners on 7 August for US$11M.
The company gained a three-month contract for 2008-built PSV FS Crathes for operations in the North Sea during Q4 2023.
Other Norwegian owners have won contracts for vessels operating in the region in recent weeks.
Eidesvik Offshore secured a contract extension from Wintershall Dea and OMV for its 2008-built PSV Viking Queen. This extension runs from May 2024, in direct continuation of the current contract, extending the firm period to October 2025.
“We are very pleased with this extension and consider it as a quality mark for the operations and services delivered,” said Eidesvik Offshore president and chief executive Gitte Gard Talmo.
Reach Subsea has exercised a one-year option for 2011-built multipurpose support vessel Havila Subsea that will keep this Havyard 855 design vessel providing inspection, maintenance and repair work and ROV operations with Reach Subsea until the end of 2024.
Ålesund, Norway-headquartered Golden Energy Offshore Services (GEOS) said it had achieved TCE earnings of US$20,317 per day and fleet utilisation of 98% in August. Presently, GEOS has three PSVs, with Energy Swan contracted on term business to Repsol Norway, Energy Empress working in the Caribbean and Energy Duchess trading on the spot or short-term market with very high utilisation.
“The market continues to improve in multiple regions and Energy Duchess is well positioned to capitalise on several attractive business opportunities going forward,” said GEOS.
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