Industry innovation rising to meet the Oil Price Mirage – AOG Conference 2017

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Last week, the annual Australasian Oil and Gas (AOG) conference took place in Perth, Australia,  It was an ideal opportunity to take the temperature of the current industry outlook in this part of the world.

Despite the reduced number of exhibitors and attendees on previous years, the temporal waves of panic from 2015/16 were replaced with a steely outlook of “the worst is behind us” in a spark of returning confidence. Companies having survived initially by trimming budgets are increasingly adopting an innovation mindset of “what worked previously may not apply now”, in a price environment that seems to have settled around the ‘new normal’ of $45-55 per barrel.

Analysts indicated $60 oil as a key tipping point fuelling additional spending on E&P activity while replacing gas reserves for LNG contracts in China and South Korea will remain a key driving force in Australia.

One area which may be of particular industry to our Drilling community, was a renewed focus on supply chain efficiencies and collaboration. A stream of the conference was exclusively set aside to share thoughts on this topic.

According to Wood Mackenzie a leading industry advisory specialist,  sanctioned projects for 2017 globally will double that for 2016. These approvals will generally apply to projects running at averages of just US$7 per barrel in capital costs as opposed to US$17 per barrel for 2014 projects.

These projects have a forecast IRR of 16% up from an IRR of 9% on 2014 projects (IRR is internal rate of return and is basically the interest companies earns on the money they invest in these projects).

Australia has been identified as one of the leading locations in the word for improved oil and gas expenditure. Australia’s strong LNG position is a catalyst for increased spending. Recent major discoveries at Phoenix South and Roc off the Northwest Coast of WA are also interesting blinks on the oil and gas radar.

Chevron’s proposed drilling campaign in the Bight Region and BP’s hunt for a new major gas field at the Ironbark Prospect all point towards a renewed buzz of interest for deepwater prospects.

Other projects are Greater Flank Phase 2, Greater Enfield, Gorgon Stage 2 and Waitsia Phase 2 all approved or in the process of getting the go ahead.

An increase in rig tenders also points towards increased activity that should lead to an increase in the number of rigs from its current 5 to perhaps 7-8 rigs at the end of the year and beginning of 2018.

All in all good news and a more positive atmosphere than the last couple of years with some tangible light appearing at the end of the tunnel.

Share your thoughts or feel free to get in touch at Martin.Flojgaard@rigforceglobal.com or +618 9389 2800.

 

Offshore On Topic

Oil drilling rig in sunset time.

Welcome to the Rigforce Blog; Offshore On Topic 

Offshore On Topic gives you regular updates on all things Rigforce, as well as keeping you abreast of industry trends and market forces. Each week we’ll send information, insights and updates from around the world and cover everything on:

  • International oil and gas jobs and the labour market.
  • Rig operators and Oil companies
  • Exploration and Production News
  • New and current drilling campaigns
  • Global Oil Industry News
  • The offshore lifestyle
  • Training and certifications

 

To get started here’s a snapshot of who we are and where you’ll find us this year.

Who is Rigforce?

We are an international recruitment and manning services company specialising in both offshore and shore-based personnel involved with the oil and gas drilling industry.

Where are Rigforce operating?

Rigforce are headquartered in Australia with offices in the UK and Singapore. We work with clients across major oil and gas regions worldwide, including Asia-Pacific, the Middle East, North Sea and Africa. We currently support crew rotating out of Saudi Arabia, Dubai, West Africa, Singapore and Australia.

For more information about anything we’re doing at Rigforce, please email us, register for our Quarterly newsletter or check our website.

 

Rigforce communications are intended to provide general information and commentary and should not be taken as professional or legal advice.  

Welcome aboard Martin Flojgaard

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This month we welcome Martin Flojgaard to Rigforce as our Principal Advisor in Employee and Industrial Relations matters.

Martin brings 38 years of experience in the offshore drilling industry to our team, having worked on rigs for Maersk Drilling and Reading & Bates Drilling Company, as well as shore-based support roles including country manager.

Based predominantly in Australia, Martin’s career has taken him to South America, Africa, the Middle East and Asia Pacific. Many people know him for his work on the Otway Gas Project in the Bass Strait in 2005, and for the conversion and commissioning of the Vincent FPSO. The respect he has in the industry is built on his vast expertise across the many different aspects of an offshore project.

“I am very happy to join the Rigforce Team, who I consider the benchmark in the offshore drilling manning industry, both from a client and an employee point of view,” Martin said. “I appreciate the Rigforce approach of ‘people working with people,’ which can often get lost with service providers in our industry.”

We welcome Martin to the team and look forward to sharing the benefits of his experience with our clients and personnel.

 

Rigforce communications are intended to provide general information and commentary and should not be taken as professional or legal advice.