BAKU, Azerbaijan, May 21
By Leman Zeynalova – Trend:
The oil and gas industry has an opportunity to optimize 6 percent of its future production (equivalent to about 7.5 MMboed) at $55/bbl over the next 10 years (2020- 2030), Trend reports with reference to Deloitte.
The industry can also redeploy 20 percent of its future capex amounting to $838 billion over the next 10 years toward more economical hydrocarbon projects and/or promising new ventures, says the company.
“About 90 companies lie in the top right troubled quadrant (“strained business model”), which together have 6.1 MMboed in production and over $557 billion in capex to optimize. In comparison, companies lying in the bottom left quadrant (“opportunity cost to switch”), which have the most competitive and optimal hydrocarbon portfolio, have a big opportunity cost to switch from their economical hydrocarbons business to lower carbon businesses. Among the company groups we analyzed, the resource-rich NOCs are most comfortably placed with low-cost operations and highly productive fields—only 2 percent of their production and 13 percent of their capital allocation need to be optimized at $55/bbl. Supermajors and publicly traded companies have a bigger opportunity, and supermajors on average have the potential to redeploy future capital expenditure of approximately 36 percent—a proportion high enough to continue to position them well in the changing energy landscape,” reads the latest report released by Deloitte.
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Follow the author on Twitter: @Lyaman_Zeyn
