The EU exit dampener on business confidence is in addition to the ongoing knock on effect of low oil prices and the subsequent negative impact on oil and gas production and exploration in and around UK and more distant waters.
There are far fewer contracts now compared to recent years with great competition for any on offer. Teekay Offshore Partners operate one of the largest shuttle tanker fleets which currently consists of 28 owned, three chartered-in, and three on order.
They recently announced, to quite a fanfare they had been awarded a new three-year shuttle tanker contract in the North Sea, signed with BP, Royal Dutch Shell and OMV Group to shuttle oil from the new Glen Lyon FPSO facility west of Shetland to terminals around the North Sea and in nearby waters, to commence early in 2017. But it should require just two tankers from within its current fleet.
The company state the contract helps bolster their leading market position in the North Sea and delivers “higher shuttle tanker fleet utilization.“ They go on to say that for the near future the North Sea shuttle tanker market will remain tight, but there will be more lifting points from new fields coming on-line. Though it appears there is enough tonnage available without the need to order more vessels.
The remarkable image from better days of three Teekay shuttle tanker sisters crammed into Stavanger’s inner port was a special naming celebration. An impressive, but no doubt expensive event that I doubt few North Sea oil businesses would countenance in these straitened times.