Oil & Gas Editorial: A Pause Is Not The Same As The End
After 24 months of swingeing cuts to budgets and large-scale employee attrition, the commanding heights of the oil and gas industry are making positive noises.
According to market and financial analysts, the world’s seven largest oil producing corporations are gearing up to add another three million barrels of oil equivalent to the mix over the next five years. Projected growth will see Anglo-Dutch giant, Royal Dutch Shell, supplant ExxonMobil as the world’s largest producer by 2021.
As it stands today, if Exxon were a country, it would be the fifth largest producing nation on Earth, ahead of the likes of China, Iran and Canada.
A concerted effort by major corporations to embrace the tenets of “operational excellence” have enabled them to take on a $50 per barrel oil price in a leaner and meaner position than before. Statoil, for example, sitting at number six out of seven on the output scale, began their operational excellence push with Brent crude riding high at the $110 per barrel mark, Shell began a major divestment push in 2014 that will culminate in a $30 billion asset decortication by 2018.
Those that have taken operational excellence as a credo and not a buzzword are fit to broach the Brave New World of doing more with less in the $50 valley. Those that haven’t, have either breathed their last, been subsumed, or balance precariously on the edge of the abyss.
A suspension or non-compliance with the long-sought for production cut amongst the Organisation of Petroleum Exporting Countries (OPEC) and aligned nations may agitate afresh frayed nerves across the operator/contractor divide. We would do well to remember that a hiatus is just a break in continuity, not a cure-all....