BAKU, Azerbaijan, September 12. Oil and gas exploration acreages offered for leasing globally in 2022 are expected to reach 44, which is 14 less than in 2021, and the lowest since 2000, Trend reports via the research from Rystad Energy, independent energy research and business intelligence company from Norway.
“Only 21 lease rounds were completed globally through August this year, half of the 42 rounds held in the first eight months of 2021. The acreage awarded so far this year has shrunk to a 20-year low of 320,000 square kilometers,” the report said.
As Rystad Energy explained, global spending on oil and gas exploration has been declining over the recent years as energy companies seek to limit risks by focusing on key extractive assets and regions with guaranteed production, attempting to optimize their operations and build more sustainable businesses in the face of market uncertainty and the threat of recession.
Moreover, governments are less eager to invest in fossil fuel exploration due to the global trend towards net zero future.
According to the statistics, the onshore exploration sector is making a significant contribution to the reduction of allocated areas. The total land area leased has fallen drastically from more than 560,000 square kilometers in 2019 to just 115,000 square kilometers in 2022.
"Shelf leases also peaked in 2019, before falling off a cliff in 2020, and have remained relatively constant over the past two years. Concluded lease rounds have dropped significantly in Russia, the US and Australia this year. These countries have held five lease rounds put together so far this year - down from 17 rounds in the first eight months of 202. Asian licensing has bucked the trend with increased activity and blocks awarded in Malaysia, Indonesia, India and Pakistan," said the report.
"The global decline in licensing rounds has directly affected the awarded acreage, which has hit an all-time low for the January to August period of about 320,000 square kilometers. The decline in leasing activity has resulted in a considerable drop in Russian acreage awards, falling 90 percent from a year ago to 9,000 square kilometers, while licensed acreage in Africa shrank 70 percent to just 46,000 square kilometers spread across Angola, Egypt, Morocco and Zimbabwe, the only African countries to award new exploration acreage to date in 2022. On the other hand, new acreage awarded in Asia between January and August nearly quadrupled from the same period last year, while South American awarded acreage surged by 140 percent,” the report added.
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