Morten Iversen
ConsultantMr. Iverson was previously employed by BG and Karachaganak Petroleum Operating.
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Prophets of doom have argued that there will be no cyclical upturn this time, that conventional offshore oil and gas developments, with the odd exception, have been squeezed out of the cost curve by the rise of tight oil. Yet there are signs of recovery that might breathe life back into the sector. -
Deepwater capital expenditure has nosedived since the oil-price crash of 2014 and has not quite recovered because of the high level of break-even prices required, but some oil companies maintained their interest in the sector and went ahead with big-ticket projects anyway.
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As the resources that the industry develops become increasingly challenging, access to a broader range of options and new and developing approaches allows more-efficient and -effective recovery.
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The need to offset declining production from mature basins, as well as the ability of international oil companies to access larger reserves with the use of new exploration-and-production technology, will continue to drive deepwater expenditure.
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The high costs surrounding deepwater developments and the low price of oil are a challenging combination for operators and service companies today.
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There is no question that deepwater production will play a very important part in meeting the world’s future energy demand.
