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UPDATED 1 Sept: The EI library in London is temporarily closed to the public, as a precautionary measure in light of the ongoing COVID-19 situation. The Knowledge Service will still be answering email queries via email , or via live chats during working hours (09:15-17:00 GMT). Our e-library is always open for members here: eLibrary , for full-text access to over 200 e-books and millions of articles. Thank you for your patience.
Wood Mackenzie has completed its annual global upstream capital spending report ...
Wood Mackenzie has completed its annual global upstream capital spending report for 2012, which draws out key trends in investment and the impact of cost inflation on the industry across the globe. The key conclusions are:
That 2012 will be another record year for upstream development spending - capital spending will reach around $550bn, $55bn higher than 2011.
The most spectacular growth story is North American tight/shale oil. The change is having a major impact on production - whilst sustained investment is contingent on the WTI price remaining north of $70/b, Wood Mackenzie’s upgraded forecasts for US tight oil supply are now around 4.6mn b/dy by 2020. Investment in US unconventionals overall has increased by 20% a year, for the last three years.
The pace of growth in global capital spending appears to be slowing; leading to the suggestion that upstream investment has peaked. The market analyst does not expect this to be the case. As companies complete their planning and budget processes, it expects that investment in 2013 will be between 5% and 8% higher than in 2012.
Other findings include:
Investment in Nigeria has slowed steadily since the Petroleum Industry Bill (PIB) was proposed in 2008, with upstream capital spending around 30% down from its peak in 2009. Despite this, Nigeria is still a key area for investment, as a number of major projects sanctioned before the PIB are under development.
East Africa has been one of the world’s most successful exploration provinces in recent years, but full-scale gas developments in Tanzania and Mozambique are unlikely to be implemented before the second half of the decade.
While the US dominates investment in shale gas and tight oil, there are also huge projects in tight gas, sour gas and coal bed methane (CBM) underway in Oman, Abu Dhabi, Russia, Turkmenistan and Qatar. In 2013, Wood Mackenzie expects around 28% of global upstream investment to be on some form of unconventional play.
That 2012 will be another record year for upstream development spending - capital spending will reach around $550bn, $55bn higher than 2011.
The most spectacular growth story is North American tight/shale oil. The change is having a major impact on production - whilst sustained investment is contingent on the WTI price remaining north of $70/b, Wood Mackenzie’s upgraded forecasts for US tight oil supply are now around 4.6mn b/dy by 2020. Investment in US unconventionals overall has increased by 20% a year, for the last three years.
The pace of growth in global capital spending appears to be slowing; leading to the suggestion that upstream investment has peaked. The market analyst does not expect this to be the case. As companies complete their planning and budget processes, it expects that investment in 2013 will be between 5% and 8% higher than in 2012.
Other findings include:
Investment in Nigeria has slowed steadily since the Petroleum Industry Bill (PIB) was proposed in 2008, with upstream capital spending around 30% down from its peak in 2009. Despite this, Nigeria is still a key area for investment, as a number of major projects sanctioned before the PIB are under development.
East Africa has been one of the world’s most successful exploration provinces in recent years, but full-scale gas developments in Tanzania and Mozambique are unlikely to be implemented before the second half of the decade.
While the US dominates investment in shale gas and tight oil, there are also huge projects in tight gas, sour gas and coal bed methane (CBM) underway in Oman, Abu Dhabi, Russia, Turkmenistan and Qatar. In 2013, Wood Mackenzie expects around 28% of global upstream investment to be on some form of unconventional play.
