Against the backdrop of the Hormuz crisis, MODEC has secured a position as one of the world’s two leading FPSO operators. Its long-term order backlog has reached approximately ¥4 trillion, and this could also affect the revival of Japan’s shipbuilding industry.
As the Hormuz crisis shakes a key artery for crude oil transport, deepwater oilfield development is accelerating, driving increased demand for floating production facilities known as FPSOs in waters off the west coast of South America and West Africa. Technological advances and the discovery of large oilfields have led to declining exploration and drilling costs for pre-salt oilfields, while some wells are now producing substantially more oil.
MODEC and SBM Offshore have established positions as the two global leaders in the FPSO market. Their track record includes 35 completed units, 4 currently under construction and 18 in operation. Their customers and builders are mainly overseas. MODEC uses Chinese shipyards, while its strengths include integrated design for long-term operation and a track record of meeting short delivery schedules.
Efforts such as “segmented construction,” which strengthens cooperation with domestic shipbuilders, are expected to move forward. The expansion of deepwater development in South America and West Africa could also contribute to the revival of Japan’s shipbuilding industry.
Looking toward 2030–40, the accumulated technical and operational expertise in FPSOs is regarded as a potential new source of demand for Japan’s shipbuilding industry, while also presenting a barrier to sustained market growth and new entrants.