As some independent oil firms relinquish or reduce their upstream asset holdings in Southeast Asia, new players have capitalized on these opportunities to establish a regional presence.
While independent oil companies (IOC) have disposed of or scaled back on their holdings of upstream petroleum assets in Southeast Asia, a few industry start-ups have taken advantage of these opportunities to gain a foothold in the one of the world’s fastest growing energy market.
Malaysia-based Tamarind Energy and Ping Petroleum as well as Singapore-based AziPac Ltd. are new entrants in Southeast Asia’s exploration and production (E&P) sector that seek to potentially fill the void left by the IOCs.
These include Hess Corp., Newfield Exploration Co. and Murphy Oil Corp., all U.S. based firms that had made the decision on their upstream business in Southeast Asia after having undergone a strategic review of their company operations in the past one to two years.
Despite the IOC’s move, Southeast Asia continues to be an attractive investment destination for the global oil and gas industry, with regional energy demand projected to grow by over 80 percent from 2013 and 2035, equivalent to the current consumption in Japan, the International Energy Agency (IEA) highlighted in its “Southeast Asia Energy Outlook” last year.
To cope with rising energy demand, the IEA has estimated that Southeast Asia would need cumulative investment of $210 billion and $460 billion for the oil and gas sectors, respectively. Of these 79 percent or $161.95 billion will be needed for the upstream oil sector, while gas will account for 81 percent or $372.6 billion.
The timing selected by Tamarind and AziPac in setting up their Southeast Asian operations to capture a slice of the booming regional E&P market coincided with relatively high crude oil prices – that had hovered at above $100 a barrel for several years prior to the recent slump that commenced in early September.
High crude oil price has been an important factor that prompted new E&P companies to “consider acquiring oil and gas assets in Southeast Asia,” Kong Ho Meng, an oil and gas analyst at Malaysia’s RHB Group told Rigzone.
View Full Article
WHAT DO YOU THINK?
Click on the button below to add 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.
More from this Author
Most Popular Articles
From the Career Center
Jobs that may interest you