Advantages of an FPSO – 15 Key Advantages of an FPSO

advantages of an fpso

In today’s world of offshore oil and gas production, FPSOs or Floating Production Storage and Offloading systems, are the primary method used in production. You might ask, what are the advantages of an FPSO?

In this article, we look at the advantages of an FPSO. However, before we list them let us define what an FPSO is.

What is an FPSO?

An FPSO is a floating production system that receive fluids, mostly crude oil, water and other things, from a subsea reservoir through risers, which then separate fluids into crude oil, natural gas, water and impurities within the topsides production facilities onboard.

Crude oil stored in the storage tanks of the FPSO is offloaded onto shuttle tankers to go to the market or for further refining onshore.

Most FPSOs or FSOs are ship-shaped and can be secured to the seabed using a variety of mooring systems. The choice of the mooring system used is determined by the specific environment of where the oil and gas production is taking place.

You should know that FPSOs are created to suit a wide range of water depth, environmental conditions and can be designed with the capability of staying on location for continuous operations for over 25 years or longer.

15 Top Advantages of an FPSO

There are several advantages of an FPSO in the oil and gas industry. Here, we list fifteen key advantages which include;

  1. FPSOs saves time.
  2. They are safer.
  3. Provides convenience.
  4. Makes more oilfields viable.
  5. Increase oil storage capacity.
  6. Quick roll out.
  7. Less overheads hence less costly.
  8. Do not have to be custom made.
  9. They can withstand harsh weather.
  10. FPSOs are mobile.
  11. Costs less to demobilize.
  12. Great for deep water production.
  13. Asset integrity costs are lower.
  14. Eliminates the need for underwater infrastructure.
  15. FPSOs are environmentally friendly.

As you can see in this list, there are many benefits that using an FPSO provides. Investors in the oil and gas industry, especially in offshore production find great value in investing in buying or leasing an FPSO or FSO.

Benefits or Advantages of a Floating Production Storage and Offloading (FPSO) System.

  1. FPSOs Saves Time

FPSOs can connect to any pipeline. In addition, when an existing oilfield is depleted, an FPSO can move to another location. This saves time and money and mitigates the need to build expensive permanent pipelines and facilities. As such, FPSOs make an ideal solution for smaller oil and gas fields that will be depleted in a matter of years.

  1. They are Safer 

FPSOs can be disconnected from the pipelines and oil wells they are moored to. This makes FPSOs a safer option in areas with severe weather conditions.

  1. Provides Convenience

Oil producers can lease the vessels, giving oil and gas companies greater flexibility over their assets ensuring they can react to market forces. An oil and gas producer can conceivably lease as many or as little FPSOs as they want. This kind of flexibility isn’t feasible with fixed assets which take years to build and finance. This not only saves costs but it bridges the gap between small and large oil and gas organisations, ensuring healthier competition.

  1. Make More Oilfields Viable.

Some oil and gas fields lack commercial viability due to weather hazards, the distance to the shore or the cost-inefficiency of building and maintaining traditional infrastructure. FPSOs mitigate this by being insensitive to deep-water and adverse weather.

  1. Increases Oil Storage Capacity

FPSOs can store a substantial amount of oil and gas, increasing the commercial viability of hard to reach fields.

  1. Quick Roll Out

The average semi-submersible oil rig takes 3-4 years to kit out and build, and a jack-up rig 2-3 years. An FPSO could be rolled out in months to a year, from laying the keel in dry dock to first launch, even less if an existing vessel is simply being modified into an FPSO.

  1. Less Overheads hence less costly

As an example of how much a rig costs, the Deepwater Horizon was commissioned for $560 million in 2001 whereas an FPSO refit or fresh construction would cost considerably less. The largest FPSO in operation today – Exxon’s Kizomba A – cost $800 million to construct, but with the ability to be easily refitted at regular intervals, it will outlast its fixed position counterparts by decades.

With FPSO, oil and gas companies are not required to build permanent structures like pipelines and piled buildings. FPSOs have the capability to store processed oil and gas and offload it to shuttle tankers for transportation to refineries.

According to reports, a purpose-built FPSO can cost north of $800 million, especially if their production capabilities exceed 250,000 barrels per day (BPD).

Meanwhile, a traditional offshore oil platform can cost up to $650 million. While the initial cost of an FPSO is slightly higher, FPSOs prove to be more cost-effective in the long run.

The cost of a traditional offshore oil platform can skyrocket when other expenditures are taken into account, such as maintenance, well completion costs and platform decommissioning costs.

  1. Do not have to be custom made

Unlike their fixed platform and semi-submersible counterparts, an FPSO does not have to start its life as an FPSO. The first ever floating production, storage and offloading unit, BP’s Castellôn, was an oil tanker in a former life, and many of its descendants are also vessels that have been converted from transporters to harvesters of hydrocarbons. “Recycling” assets in this way brings inherent cost-saving benefits.

  1. They can withstand harsh weather

Unlike their fixed position cousins, FPSOs are mobile units and, as such, are able to navigate away from potentially perilous weather conditions. Permanent installations would be vulnerable in the hurricane-riddled Gulf of Mexico, cyclonic activity zones like the South China Sea and iceberg-infested waters around the Arctic circle, whereas FPSOs are able to relocate and elude these dangers.

10. FPSOs are mobile

FPSOs were conceived as the perfect solution to develop marginal fields – and so find themselves ideally disposed to a world with rapidly exhausting conventional reserves. Once the source of hydrocarbons has plateaued in a specific site, an FPSO unit can then move on to its next target. In this way, owner/operators are dispensing with the need to build and maintain costly platforms in economically dubious situations, whilst retaining value with the employment of a reusable unit.

11. Costs less to demobilize

When a well becomes economically unviable due to under-production or depletion, the removal of equipment, capping of the well and any environmental clean up that has to be enacted before the well can be abandoned, could reach into the hundreds of millions of dollars. An FPSO considerably minimises this expenditure as little permanent infrastructure has to be considered.

12. Great for deep water production

With operators having to drill deeper than ever before to hit the black gold, deep and ultra-deep water plays like the Santos Basin, the US Gulf Lower Tertiary and the Arctic region are becoming more plausible choices for an oil-thirsty world.

In areas such as these, where subsurface pipelines would be logistically challenging and export by shuttle tankers is increasingly expensive, an FPSO provides the best of both worlds as a tailored upstream and midstream unit rolled into one.

13. Asset integrity costs are lower

Safety and maintenance is always a game of margins, and with fixed structures invariably located in harsh climates and rough waters, risks and costs are high. With smaller crews, the ability to dodge adverse weather events, and the mobility to put into port or dock for regular repair and inspection, the FPSO is its own solution to the problem of offshore asset integrity.

14. Eliminates the need for underwater infrastructure

In a situation where laying pipelines is not a cost-effective solution, the FPSO is particularly well-adapted. FPSOs tap in to existing well centres with its retractable risers, negating the need for extensive undersea hydrocarbon transportation.

15. FPSOs are environmentally friendly

In the post-Macondo era, the potential of the oil and gas industry to do severe and life-changing damage to the environment has been highlighted to an extent not seen since the Exxon Valdez disaster of the 1990s. While many rigs have been in operation for several decades and have a permanent ecological footprint, an FPSO can be designed and redesigned for more environmentally friendly field operations than their immovable brethren.

Related: Components of an FPSO Vessel

Disadvantages or Limitations of an FPSO

While there are numerous advantages to FPSO, it does have a few limitations.

Long Conversion time 

Converting a tanker into an FPSO can take up to two years. While this is something to consider, it is still substantially faster than building a pipeline.


Companies may find that they are competing with their own pipeline-based infrastructure.

Initial Cost

The upfront cost of an FPSO can be more than the cost of building a large fixed offshore platform.


In conclusion, and as listed above, the advantages of an FPSO are many. They provide you or an investor in the oil and gas industry with benefits especially when undertaking offshore oil and gas production.