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10 must-know facts from the challenging climates report 2014

Lifecycle stage
Drilling Production Late-Life

3.  CAPEX BUDGETS SET TO TIGHTEN

Optimism may be high, but CAPEX budgets are set to shrink. Since 2012 respondents expecting to increase CAPEX in the year ahead has dipped from 63% to just 45%.

The report has found that the impact of budget cuts means businesses plan to both cut their headcount (16% of respondents), whilst 60% intend to pressure suppliers to curb increases until the following year.

4.  WEAK ENERGY PRICES

Overall 23% of survey respondents agreed that energy prices will continue to be weak into 2015 – whilst 39% disagreed with the outlook.

A larger majority believed the rise of unconventional oil and gas supplies (69%), and the weak global economy (55%), were key factors in reducing the prices in the long term.

5.  LARGER COMPANIES WILL DOMINATE

Over half of the respondents believed that larger companies will begin to dominate the industry in the future as they push towards ‘consolidation’.

This change is believed to have been driven by the emergence of tougher regulation and the rising operating costs. 37% say that their ‘large’ companies intend to acquire specialist knowledge partners as they move into tougher E&P sites.

6.  AMERICA AND AUSTRALIA ARE TOP DESTINATIONS

US, Brazil and Australia are the go-to destinations for 2014/2015 according to industry experts, whilst Nigeria has been labelled the ‘least favourable’ after security issues, corruption and political uncertainty.

Malaysia and China have both risen up the rankings to 4th and 5th respectively as fresh investment in new fields has moved up the agenda.

7.  SIGNIFICANT INVESTMENT IN SUBSEA TECHNOLOGY

53% said that subsea technology will see greater investment in the coming years, along with other new technology, as operators look towards tougher E&P zones.

Other technology areas on the investment list include floating liquid natural gas (FLNG), enhanced oil recovery, and unconventional oil and gas extraction.

8. HEALTH AND SAFETY HAS IMPROVED

As we featured on our blog recently, 2014 has seen the rise of better health and safety practices throughout the industry – respondents agreed that the changes have genuinely led to a better working environment.

60% believe that developing a more widespread safety culture will continue to enhance the procedures already laid out in 2014.

9.  SUPPLY CHAIN STANDARDISATION IS HAPPENING

Due to the complexity of new fields and the ever-growing supply chain, operators are looking towards efficiencies to reduce their spending going forward.

22% said that their company will increase its use of larger partners to attempt to centralise, standardise and streamline their supply chain.

10.  POPULARITY OF ASSET LIFE EXTENSION INCREASING

47% of all respondents acknowledged that their companies are now planning for far longer asset life spans than ever before.

54% have also admitted looking for new recovery technology and techniques, including slot recovery, to help them collect more reserves than the original asset life.

Claxton Engineering themselves have worked on key slot recovery projects across the North Sea and beyond. Delivering subsea conductor drilling and pinning solutions as well, Claxton has assisted operators in extending their asset life of ageing platforms.

For more information on Claxton’s asset life extension expertise, download the Slot Recovery Case Study Pack here.

Photo Credit: DNV GL

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