Oil & Gas Execs: Market Moving Up

Monday, January 23, 2012
Pekka Paasivaara, member of the GL Executive Board

While forecasts of financial gloom dominate mainstream news casts, there is an emerging feeling of optimism in fo the near term prospects for the oil and gas business. Oil and gas industry leaders have forecast improved performance and higher levels of capital expenditure this year, despite concerns over global economic instability, according to a new report on the future of the sector. 

Increased investment across the industry will focus on exploration activity, with North America emerging as the area with the greatest opportunities in 2012.
Big Spenders: The outlook for the oil and gas industry in 2012, is the Economist Intelligence Unit’s second annual industry barometer, commissioned by GL Noble Denton, an independent technical advisor to the industry with considerable insight into many of the issues faced by those operating in the oil and gas sector. 
82% of the 185 board-level directors and industry policy makers surveyed for the report are either highly or somewhat confident about the business outlook for their company, compared with 76% last year. Just 8% of those polled described themselves as pessimistic over performance in 2012. 
Findings from the research also show that nearly two thirds (63%) of executives plan to invest either somewhat or substantially more over the next year, in contrast to 49% in 2011. 41% of industry professionals expect to see increased investment in exploration activities over the next year, with only 4.3% anticipating a decline.
There remains a caveat, however; if global economic conditions deteriorate, oil and gas companies will have to scale back their spending commitments where they can do so without creating damage to their wider portfolios, according to the report.
Other key findings from the research, as reported by the Economist Intelligence Unit, include:
- Rising operating costs emerge as the top barrier to growth. More than 50% of respondents say that they expect there to be an increase in wages over the next 12 months.  54% of respondents also expect the cost of contractors to increase, compared to only 11% anticipating a decline.
- Risk remains a key challenge. An overwhelming majority of respondents - 82% -     either strongly or somewhat agree that regulatory issues have become more important in the post-Macondo period. Increasing regulation is regarded by more than 30% of respondents as the main challenge for their company over the next 12 months. 
- Skills shortages are becoming more acute. According to the Economist Intelligence Unit’s research, this issue comes out of the survey as one of the major obstacles to growth over the next 12 months. Last year, skills issues came fifth on the list of barriers and were only identified as a top three issue by 25% of respondents. This year, the issue has risen to second on the list, and has been identified as a key barrier by 34% of respondents. 
 
Unconventional gas: A global game changer? 
The advent of projects like the Marcellus, Barnett, Haynesville and Fayetteville shales have created a supply glut that has affected global prices. Yet there is widespread doubt as to whether the shale gas revolution can be exported outside North America.
Scope for optimism for refiners: After a dismal few years, the downstream sector is showing some signs of life, at least in the US. Refining profitability has improved where robust margins have resulted from a revival of consumption of refined products. But Asia and Europe remain in the doldrums. 
Pekka Paasivaara, member of the GL Executive Board, said: “The second annual Economist Intelligence Unit oil and gas industry barometer sends a clear message: Companies are preparing to spend big in 2012, despite a slower growth in demand for oil and gas during the second half of last year, and concerns over the future of the global economy.
“But this doesn’t mean that our clients are sanguine about their prospects for the year ahead. Findings from the report highlight a wealth of barriers to success, from rising operating costs to the worry of an impending shortage of skilled professionals and an uncertain regulatory environment in the post-Macondo era. 
“While capital expenditure looks set to take off, industry leaders will need to invest selectively this year, keeping operating risks low during a period of prolonged uncertainty. Their success will be defined by an ability to develop innovative approaches to operating more safely, efficiently and sustainably than ever.”
Maritime Reporter September 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

VT Halter Begins Building LNG-powered ConRo Ships for Crowley

VT Halter Marine, Inc., a subsidiary of Vision Technologies Systems, Inc. (VT Systems), has commenced construction on the first of two liquefied natural gas (LNG)-powered,

NYK Line Joins PNW West Coast Metro Pool

Effective October 20, 2014, NYK Line has become a member of the PNW West Coast Metro Pool (WCMP) operated by Trac Intermodal. The WCMP operates chassis at all major marine terminals,

ISS Manages Heavy-lift Project at Port of Mombasa

Inchcape Shipping Services (ISS) announced it has completed another complex heavy-lift project in Africa, this time at the Port of Mombasa in Kenya. ISS was

Offshore

Renewable Energy: Schottel Tidal Turbines Ready For Use

In the last months Schottel  successfully tested its hydrokinetic turbines in Strangford Lough, Northern Ireland. The full-scale tests included 260 operating hours under realistic conditions.

Total CEO Killed in Moscow Runway Accident

Private jet collided with snow plow during takeoff; Total's CEO a defender of Moscow policies. Insiders Boisseau and Pouyanne long seen as potential successors.

Statoil: New Oil in the Grane Area

Statoil has together with PL169 partners proved new oil resources in the D-structure in the vicinity of the Grane field in the North Sea.   Well 25/8-18 S, drilled by the rig Transocean Leader,

Finance

Gulf Craft to Invest $100m in Dubai Shipyard

Company plans to invest $100 million over the next five years in the development of a new shipyard in Dubai Maritime City to build a global luxury yachts manufacturing

Pentair Reports 3Q 2014 Sales of $1.8 bi

Pentair plc today announced third quarter 2014 sales of $1.8 billion. Sales were up 3 percent compared to sales for the same period last year. Third quarter 2014

FortisBC Starts Expansion of Tilbury LNG Facility

FortisBC – a subsidiary of Fortis Inc. has officially started construction of its $400 million Tilbury LNG Facility expansion project today. The company is adding 1.

Energy

Russian Minister to Intervene with Gazprom on Slovakia Gas Flow

Russia's Energy Minister Alexander Novak will intervene with Gazprom to raise reduced gas shipments to Slovakia to contracted levels, Slovakia's economy ministry

Total Names Refining Boss to Replace de Margerie

French oil company Total has appointed refining boss Patrick Pouyanne as chief executive to succeed Christophe de Margerie who was killed in a plane crash in Moscow this week.

Asia-Pacific Solar Collaboration Conference

The Australian Photovoltaic Institute is holding the inaugural Asia-Pacific Solar Research Conference at the University of New South Wales in Sydney from 8-10 December 2014.

 
 
Maritime Contracts Maritime Security Navigation Pipelines Port Authority Salvage Ship Electronics Ship Repair Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2445 sec (4 req/sec)