Nippon Steel Engineering Enters Subsea System Business Field

Nippon Steel Engineering announced on Tuesday the firm enters subsea production system business field. Subsea production systems involve flowlines for subsea producing, processing and containing facilities of oil or gas wells in deep sea. Nippon Steel Engineering will prepare working vessels dedicated to subsea systems with investment of several ten billion yen per ship and start the business within 3 years. The firm aims to follow the rapid market growth of subsea systems mainly in Asia and expand its annual sales for overseas oil and gas engineering to 100 billion yen from present 50-70 billion yen.

Subsea production systems are suitable for subsea oil and gas wells in very deep sea or with small sizes since the systems need no construction of large scale structures. There are approximately 3,000 subsea oil wells worldwide at present. For next 5 years, there exist new construction projects for additional 3,800 subsea wells.

Nippon Steel Engineering has covered design, procurement and construction businesses of fixed platforms or subsea pipelines for oil and gas productive systems in shallow sea in cooperation with its business sites in Singapore, Thailand, Indonesia and Malaysia. The firm newly establishes a subsea business unit with total 13 staffs to enter the business field.

Global subsea market is estimated at approximately 2-3 trillion yen per year, in which Asia accounts for 500 billion yen. Nippon Steel Engineering targets the business sales at 5-10% of Asian market.