Upstream oil, gas spending hits record highs – US consultant

30 April 2012 18:12  [Source: ICIS news]

HOUSTON (ICIS)--Upstream capital and operating expenses for oil and natural gas are expected to hit a record price of $1,230bn (€935m) in 2012 and rise to $1,640bn by the end of 2016, a US-based consultant said on Monday.

Current capital expenses for new plays should reach a record of $728bn, while operating expenses for existing projects will likely hit record prices of $500bn in 2012, the latest IHS upstream spending report said.

A significant jump in activity for the oil and gas industry, as sustained by strong oil prices and natural gas prices outside of North America, are maintaining profits for most proposed oil and gas project, the report said. This projection is based on increases in spending for each region of the globe.

The IHS upstream spending report tracks historical spending and builds out future spending projections based on analysis of construction plans for hundreds of major projects globally. The analysis covers a five year span.

“The brief lull in expenditures in 2009 and 2010 caused by the Great Recession is behind us, said David Hobbs, IHS chief energy strategist.

“Robust oil prices and the growth of North American unconventional gas  which already accounts for $128[bn] in 2012 spending will create new high water marks for investment in [capital expenditures] and [operating expenditures] that surpass pre-recession highs.”

Upstream spending in North American is the regional leader in capital expenses and operating expenses for upstream spending, with $392bn in 2012.

($1 = €0.76)

By: Sheena Martin
+1 713 525 2653

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly