BAKU, Azerbaijan, Sept.9
By Leman Zeynalova – Trend:
The number of oil and gas contracts continues to drop globally due to lower oil prices, problems in the operation, as well as stressed capital,Trend reports citing GlobalData, a leading data and analytics company.
The company estimates that the value of the contracts in the global oil and gas industry stood at $31.96 billion in the second quarter of 2020, versus $18.01 billion in the first quarter. Thereby, the number of contracts went down from 1,267 in the first quarter of 2020 to 907 in the second quarter of 2020.
The number of contracts in the upstream, midstream and downstream/petrochemical sectors equaled to 658, 171 and 114 contracts, respectively during the reporting period.
The following key contracts were signed in Q2 2020: Qatar Petroleum’s $19.21 billion agreement with DSME, Hyundai and Daewoo for the construction of more than 100 LNG carriers, as well as the $2.85 billion contract with Hudong-Zhonghua Shipbuilding for the construction of 16 LNG carriers and Maire Tecnimont led consortium with Sinopec Engineering’s $1.31 billion contract from Amur GCC for the Engineering, Procurement and Site Services (EPSS) including the implementation of several large-scale polyolefin units in Russia.
S&P Global Ratings says that with 33 defaults this year, oil and gas leads the global default tally, followed by consumer products with 27 defaults and media and entertainment, with 25 defaults.
Oilfield parts and services suppliers are watching sales and revenues nosedive as oil and gas drillers slash their spending and activity as U.S. oil demand remains subdued as a result of the coronavirus pandemic, Ratings said.
"The oilfield services sector continues to face weak demand," Ratings said Aug. 19 as it rated Forum Energy Technologies Inc. CCC-plus with a negative outlook after the company exchanged $315 million of existing unsecured notes for 9% convertibles due in 2025, an exchange Ratings called a selective default because it did not make current noteholders whole.
"We expect oil and gas drilling and completion activity to remain subdued at least through the remainder of 2020 and likely in the first half of 2021, as producers take a cautious approach to increasing activity levels — particularly onshore North America," Ratings said.
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