Manup Industry Roundup - W0923: NEWSL -02
Good morning!
The roller coaster ride during the COVID-19 pandemic appears to be coming to an end, with contract activity returning to normal for the global oil and gas industry, despite the ongoing Russia-Ukraine conflict and volatility in crude oil prices
As a result, the oil and gas industry witnessed a year-on-year increase of 3% in overall contract value in 2022, despite a 4% decrease in contract volume, reveals GlobalData.
Below are the oil and gas stories and news that made headlines this week carefully curated by?Manup.
Summary of the news
Global Oil & Gas Contract Value Up By 3%
Contract activity appears to be returning to normal for the global oil and gas industry, despite the Russia-Ukraine war and volatility in crude oil prices, according to GlobalData.
GlobalData’s latest report, “Oil and Gas Industry Annual Contracts Analytics by Region, Sector (Upstream, Midstream and Downstream), Planned and Awarded Contracts, and Top Contractors,” reveals that the overall contract value increased from $178.86 billion in 2021 to $183.63 billion in 2022 - A 3% increase - , though contract volume saw a marginal decrease from 6,972 in 2021 to 6,668 in 2022 - A 4% decrease
Pritam Kad, oil and gas analyst with GlobalData, said, “Petrobras' three FPSO contracts, worth $8.75 billion to Keppel Shipyard (P-80?and?P-83?FPSO) and Sembcorp Marine (P82?FPSO) for the Búzios Field in the presalt Santos Basin, Brazil, were the significant contributors to the overall contract value during the year."
Operation and maintenance (O&M) represented 50% of last year’s overall contracts in 2022, followed by procurement with 24%. Contracts with multiple scopes, such as EPCI, design, and O&M, accounted for about 13%.
Other major awards included Saipem’s $4.5 billion contract from Qatargas for the engineering, procurement, fabrication, and installation of two natural gas compression facilities for the North Field Production Sustainability Offshore Compression Complex Project – EPC 2, offshore the northeast coast of Qatar.
ADNOC’s three framework agreements worth AED14.68 billion ($4 billion)?with ADNOC Drilling, Schlumberger and Haliburton for the provision of integrated drilling fluids services in the UAE was another standout award.
Kad concluded, “The oil and gas industry is likely to see some relief in the short term for now, but the environmental concerns and the recent advances toward sustainable green fuel and energy transition projects will present some significant challenges to growth in the long run."
Renewable Energy Investments Hit $1.3trn - A Record High
According to IRENA?“Global Landscape of Renewable Energy Finance 2023” report, global investment in energy transition technologies, including energy efficiency, reached a record high of USD 1.3 trillion in 2022.
However, annual investments need to at least quadruple to remain on track to achieve the 1.5°C Scenario in IRENA’s?World Energy Transitions Outlook 2022.
The report shows that the new record-high moved up 19% from 2021 investment levels and 50% from before the pandemic in 2019
Investment in renewable energy was also unprecedented – at USD 0.5 trillion – but represented less than 40% of the average investment needed each year.
However, Investments are also not flowing at the pace or scale needed to accelerate progress towards universal energy access; investments in off-grid renewable energy solutions in 2021 – at USD 0.5 billion – fell far short of the USD 2.3 billion needed annually.
Investments have become concentrated in specific technologies and uses.
In 2020, solar photovoltaic alone attracted 43% of the total investment in renewables, followed by onshore and offshore wind at 35% and 12% shares, respectively.
Based on preliminary figures, this concentration seems to have continued to the year of 2022.
To best support the energy transition, more funds need to flow to less mature technologies as well as to other sectors beyond electricity such as heating, cooling, and system integration, according to the report.
Comparing renewables financing across countries and regions, the report shows that glaring disparities have increased significantly over the last six years.
About 70% of the world’s population, mostly residing in developing and emerging countries, received only 15% of global investments in 2020.
Sub-Saharan Africa for example, received less than 1.5% of the amount invested globally between 2000 and 2020.
In 2021, investment per capita in Europe was 127 times that in Sub-Saharan Africa, and 179 times more in North America.
The report emphasizes how lending to developing countries looking to deploy renewables must be reformed and highlights the need for public financing to play a much stronger role, beyond mitigating investment risks.
Recognising the limited public funds available in the developing world, the report calls for stronger international collaboration, including a substantial increase in financial flows from the Global North to the Global South.
Read full report?here
领英推荐
Woodside Progress Reports For Gulf of Mexico, West Africa & Australia
Woodside Energy has issued progress reports on its development and exploration programs in the US Gulf of Mexico (GoM), West Africa and Australia.
GoM projects
Last June ocean-bottom seismic acquisition finished at the bp-operated Atlantis project in the GoM (Woodside 44%) to support future development opportunities. This year’s focus includes water injection expansion and a horizontal well trial to improve infill productivity.
Elsewhere in the US sector, the bp-led Mad Dog Phase 2 project should start up later in 2023, along with A-spar debottlenecking.
Studies continue for the Trion oil project 180 km offshore Mexico in a water depth of about 2,500 m, with final investment decision readiness targeted later this year.?The chosen concept is a subsea development to a semisubmersible producing 100,000 bbl/d of oil for transfer to an FSO.
Excess gas would likely head via a pipeline to existing offshore gas export infrastructure.
Main components of the reservoir development plan include crestal gas injection, peripheral water injection, and phased development drilling (24 wells in total).
Work completed last year included the FPU FEED, offshore seabed surveys and ocean-bottom node seismic data interpretation, with subsea hardware vendor engineering underway and main tender packages issued for competitive bids.
Offshore Africa and Australia
In 2022 Woodside successfully relocated an FPSO facility to Singapore to complete topsides integration and pre-commissioning.
Offshore Senegal, Woodside drilled a well to appraise a near-field tieback opportunity close to the deepwater Sangomar Field development. The well encountered gas at the target depth and was then plugged and abandoned.
In the Egyptian Red Sea, Woodside participated in a 3D seismic acquisition over offshore blocks 3 and 4, and a 2D survey was acquired over acreage offshore northern Australia.
International update
Following completion of the merger with BHP’s petroleum business, Woodside exited exploration offshore Canada and South Korea.
Workforce Watch
Will There Be a Hiring Boom in Oil and Gas in 2023?
According to Gladney B. Darroh, the founder and president of Houston based Piper-Morgan Search, there will not be a hiring boom in the oil and gas sector in 2023.
“There will continue to be market-sensitive, even paced hiring for new grads and experienced hires”.
“For new grads it is because they are replenishing a company’s pipeline for talent and talent development as existing employees move up the career ladder or age out”.
“For experienced hires it is because they offer specific play/regional talent to fill a void created by a departure from the company, or to staff a role in a brand new area of interest of the company for which there is no existing talent, or hired into a newly created position with a start-up”.
When asked if the oil and gas industry was poised for a hiring boom this year, Chad Spencer, the CEO of Houston headquartered Hazeltine Executive Search Partners, a member of the Sanford Rose Associates Network, said, “despite some recent positive developments in the sector, there are several factors that suggest a hiring boom may not be in the cards for the industry this year”.
One key factor is the shift toward more disciplined spending by oil and gas companies, according to Spencer.
“In recent years, many companies have prioritized drilling within cash flow and returning value to shareholders, rather than simply drilling for the sake of drilling”
“This focus on financial discipline has helped many companies weather the recent downturn in the industry, but it has also meant that they are less likely to ramp up hiring in the near future,”
According to Spencer another factor that may limit hiring in the industry is the ongoing skills gap. So even if companies were inclined to hire more workers, they may struggle to find qualified candidates to fill the roles
“Moreover, the ongoing energy transition may further reduce the demand for traditional oil and gas jobs in the long run. As the world shifts toward renewable energy sources, the demand for workers in sectors like solar, wind, and battery storage may grow faster than the demand for oil and gas workers”
The Hazeltine Executive Search Partners CEO said the recovery in oil prices and increased investment in exploration and production “may create some hiring opportunities in the short term”.
“However, it remains to be seen whether these factors will be enough to spur a full-fledged hiring boom in 2023”.
Other stories we are following…