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INTERNATIONAL GROWTH
Energy Industry’s Opportunities
FOR INTERNATIONAL GROWTH By Tsvetana Paraskova
Norway, Western Europe’s biggest oil and gas producer, is also increasing its hydrocarbon production as authorities in the summer approved applications from operators to boost production from several operating gas fields, to allow higher gas production as Norway’s key partners, the EU and the UK, scramble for gas supply ahead of the winter. However, Norway needs continuous efforts from operators on the shelf to increase production, develop new fields, and make new discoveries to offset a natural decline in production over time, Norway’s Minister of Petroleum and Energy, Terje Aasland, said in early October, when the government said it expected record revenues from oil and gas for 2023.
Energy firms and the oil and gas industry’s supply chain are preparing for a multi-year upcycle in conventional energy exploration and production in a new geopolitical reality where the UK, the EU, and the US are banning Russian oil imports and looking to find alternative supply. At the same time, the biggest international energy firms are increasingly looking at renewables and are investing more in clean energy solutions, including offshore wind, solar, EV charging, carbon capture and utilisation, and hydrogen. The industry and the supply chain are positioned to grow internationally if they seize the opportunities that short-term oil and gas supply shortages and long-term demand for renewables offer, analysts and industry associations say.
www.ogv.energy I November 2022
Energy Security Boosts Oil & Gas Prospects Security of oil and gas supply has been top of the agenda for every government in the West since the Russian invasion of Ukraine. And with oil and gas expected to continue playing an important role in the global energy mix and supply, companies could look at more projects in the short term. For example, The North Sea Transition Authority (NSTA) launched in early October applications for licences to explore and potentially develop 898 blocks and partblocks in the North Sea which may lead to over 100 licences being awarded. In this 33rd licensing round, the NSTA has identified four priority cluster areas in the Southern North Sea, to encourage production as quickly as possible. Those clusters have known reserves of oil and gas, are close to infrastructure, and have the potential to be developed quickly, therefore, applicants will be encouraged to bid for these areas so they can go into production as soon as possible. “Oil and gas currently contribute around three quarters of domestic energy needs and official forecasts show that, even as demand is reduced, they will continue to play an important role. As we transition, maintaining a clean domestic supply to meet that demand can support energy security, jobs and the UK’s world class supply chain,” the NSTA said.
Norway’s latest annual licensing round in predefined areas (APA) for the best-known exploration areas on the Norwegian shelf attracted applications from 26 companies. The authorities aim to award new production licenses in the announced areas at the beginning of 2023. In the Middle East, the state oil firms Aramco of Saudi Arabia and ADNOC of the United Arab Emirates are looking to boost their oil respective production capacity by 1 million barrels per day (bpd) each this decade and significantly increase gas exploration and production, for potential exports and for replacing oil with gas in their domestic power generation mix. Qatar, one of the top LNG exporters in the world, has entered into cooperation with some of the top international oil and gas firms who will be minority shareholders in what would be the biggest LNG expansion project in the world, ever. Commenting on the prospects of the energy industry and oilfield services in the coming years, Schlumberger’s CEO Olivier Le Peuch said at the end of October: “Against the backdrop of the energy crisis and limited spare global capacity, the world faces an urgent need for increased investment to rebalance markets, create supply redundancies, and rebuild spare capacity.” “Concurrently, we are witnessing a significant commitment from the industry to decarbonise oil and gas, with E&P operators all over the world deploying capital and adopting technologies— including digital—at scale, to reduce emissions. Taken together, we expect these constructive fundamentals and secular trends to support multiple years of growth,” Le Peuch added.
