Insight
Underspend threatens upstream corporate growth
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Report summary
Investment by 52 leading IOCs and NOCs in our Corporate Service is at a very low ebb. Four years of deep capital rationing has had a severe impact on resource renewal, particularly in the conventional sector. The result is a corporate sector divided in two: the US tight oil ‘haves’ with a strong outlook for investment and growth; and the ‘have nots’, many of which lack a hopper of substance. We analyse how the lack of investment has impacted growth prospects and look at the options for companies to sustain production next decade.
Table of contents
- Executive Summary
- Upstream growth in jeopardy?
- Investment has collapsed and future spending is trending down
- Over half of companies are failing to replace production
- Conventional growth hoppers have shrunk
- while US tight oil resource grows, and grows, and grows
- Production problems loom next decade
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What are the options to sustain output to 2030?
- 1. Contingent resource commercialisation: 3 million boe/d risked potential
- 2. Conventional exploration: 6 million boe/d but unevenly distributed
- 3. M&A: growth pressures will trigger more consolidation
- Additional investment of over US$1 trillion will be needed
- Conclusion
- Appendix
Tables and charts
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Companies analysed, broken down by peer group
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