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Study: North America to Hold Greatest Growth Opportunities in 2013

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For the U.S. oil and gas industry, 2013 will be a glory year despite pressures from increasing regulation and a mounting shortage in skilled professionals, according to research findings released by GL Noble Denton.

Seismic Shifts: The outlook for the oil and gas industry in 2013, is an annual litmus test for industry sentiment in the year ahead. The research has been produced with input from a survey of more than 400 senior oil and gas professionals and in-depth interviews with 20 industry executives.

Americas headline findings for 2013:

  • North America will hold the greatest growth opportunities in 2013, with the U.S. seen as the industry's number one investment destination
  • 60% respondents expect overall capital expenditure to rise in North America
  • Six in ten (58%) of those polled in the U.S. expect to increase spending on compliance in 2013
  • Latin America emerges as the second greatest region for growth, up from fifth place in 2011

The North American oil and gas industry looks set to achieve record performances this year, following the continued growth of unconventional gas and its biggest-ever increase in oil production in 2012. Forty-two percent of industry professionals questioned for GL Noble Denton's research singled out North America as the region with the greatest growth opportunities, signalling predictions for an ongoing upsurge in the region's pace of development. This is clearly reflected in the fact that nearly two thirds, or 60 percent, of oil and gas professionals in North America expect U.S. capital expenditure to rise.

According to the findings of the report, the Americas as a whole have already overtaken Asia as the oil and gas industry's preferred investment destination. The International Energy Agency (IEA) reckons the U.S. will be in a position to rid itself of its dependence on foreign oil within a decade. Latin America is also expected to develop significant growth potential, with Brazil leapfrogging countries in the Asia Pacific region to become the second most favorable country for investment in 2013. Asian countries have been pushed out of the top six preferred oil and gas investment destinations this year, suggesting that a shift in geographic balance has begun to occur.

Arthur Stoddart, GL Noble Denton's Executive Vice President for the Americas, said: "The findings of our research indicate that an east-west divide is emerging in the global oil market. It has been suggested by the IEA that the U.S. will be in a position to rid itself of its dependence on foreign oil and gas within a decade, and we are seeing the early signs of this potential.

"As the U.S. transitions to become a hydrocarbon exporter, and oil and gas activity in Canada and South America continues to thrive, there is potential for the majority of U.S.-bound Middle Eastern supply to be diverted to an increasingly robust and demanding Asian market in the future."

While confidence is high for the Americas' oil and gas industry in 2013, GL Noble Denton's research suggests that it won't all be easy going. In the wake of the Macondo oil spill, industry professionals are expressing increasing concern over the mounting cost of meeting tougher regulatory requirements. Globally, nearly six in ten (57 percent) of those polled contend that they have learned lessons from the Macondo spill and changed their operating practices as a result. In North America 58 percent say they will have to spend more on compliance, almost double the number in Europe (32 percent).

This rise in spending is compounded by fears of an industry-wide deficit of skilled oil and gas professionals. The issue is now seen as the number one barrier to growth, up from the second biggest barrier in 2012 and fifth biggest in 2011. The research has also revealed that gas prices are likely to remain depressed this year. The majority of those surveyed believe that the wholesale cost of the commodity will fluctuate by no more than 10 percent in 2013, sparking concern over the viability of some unconventional gas projects as the year goes on.

Mr. Stoddart said: "Our research shows huge confidence in the U.S. oil and gas industry which is clearly supported by strong growth in the Americas, despite a number of potential barriers. The growing cost of regulatory compliance in North America continues to surge sparking industry concern that regulation is being rushed into place. Indeed, only 10 percent of those surveyed agreed that the new U.S. regulations have been properly thought through.

"The growing concern over a global shortage of skilled professionals has not bypassed the Americas region either. As investment in the American oil and gas industry continues to rise, a question mark looms over the sector's ability to resource new projects at the same speed that new projects could potentially be developed."

WHAT DO YOU THINK?

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Merlin R Prosper | Jan. 21, 2013
Not sure if there is a global shortage, I have been looking far part time are full time in the Oil & Gas work for the pass year and half, I have 40 + years with much oil & gas experience that will go by the wast side. Could be an asset to some one.

Hi Merlin, have you visited our career center and posted your resume? If not, please do so. Good luck!


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