Middle East and North Africa investment and cost trends: on the road to recovery?

Upstream capital investment in MENA has started to recover following US$30 billion of cuts over the past three years. In a lower for longer oil price environment, MENA's low development and production costs continue to attract company investment. More challenging projects, such as deepwater gas developments, are also being sanctioned. Although maintaining crude capacity remains the priority, domestic gas projects are driving new investment. Of the 12 projects we expect to have taken FID between 2015 and 2019, 10 are gas developments. While geopolitical instability continues to impact investment in some countries, confidence is up across the region. We expect more projects to take FID in 2017 than in 2015 and 2016 combined and total regional capital spend to be US$316 billion between 2017 and 2020.