With deepwater break-even prices slashed by 50% or more, expect oil company focus to remain fixed on cost efficiencies, says John Snyder.
The gains international oil companies have realised by investing in new technologies have been nothing short of astounding, particularly given they have come, in part, during an oil price crash. Through efficiency gains, Equinor, Shell and others say they now have a break-even price of US$30 per barrel of oil produced in deepwater offshore projects – less than half of what it was just a few years ago.
With this success, oil companies will continue to drive digitalisation and automation in the oil and gas industry as a means of improving efficiency, productivity and safety – and the bottom line. There will not be any backsliding to the ‘good old days’ of unchecked spending.
Speaking at the CeraWeek Conference on 6 March in Houston, Saudi Aramco president and chief executive Amin H Nasser called on the energy industry to take action in four key areas to ensure global oil and gas demand was met in the years ahead. Among "expanding exploration, offsetting declines in legacy fields, new and continued investment, and enhancing and creating new game-changing technologies," the final point stands out.
As charterers push these game-changing technologies in the energy business, they will look to OSV owners as partners in the digitalisation transformation. This will mean continued investment in fuel consumption monitoring, vessel tracking and other digital tools that will help improve logistics, fuel efficiency, increasing productivity and sustainability. For charterers, it will provide the verifiable hard data they need to improve decision-making.
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