Baker Hughes expects Latin America to help underpin upstream activity

International hydrocarbons exploration and production growth will be driven in part by Latin America, according to Lorenzo Simonelli, CEO of energy technology provider Baker Hughes.

“Looking out beyond 2024, we expect global upstream growth to be led by Latin America and western Africa offshore markets, and the Middle East, albeit at a decelerated pace,” the executive said in the company’s second-quarter results call.

Simonelli placed emphasis on continued strength in onshore and offshore production orders, led by the FPSO market.

“Over the next few years, we anticipate the market awards seven to nine FPSOs per year, driven by growth in Brazil and Guyana.”

Another market segment highlighted by the CEO is gas tech equipment, pointing to gas infrastructure opportunities in Latin America.

In 2Q24, Baker secured two offshore topside contracts to provide power generation systems for two FPSOs to be installed in Latin America and picked up a 25-year service agreement to support a customer's offshore operations in the region. The customers’ names were not disclosed.

Baker’s revenue from Latin America for the three months ended June 30 totaled US$663mn, up 4% sequentially but down 5% year-on-year, and accounted for 16.5% of total revenue in the period.