CAPEX Among Asia's O&G Companies Set to Reach $102B in 2018
Capital expenditure (CAPEX) among Asia's oil and gas companies is set to register a 37 percent year-on-year (y-o-y) increase in 2018, reaching $102 billion, oil and gas analysts at BMI Research have confirmed.
In a brief report sent to Rigzone, the analysts said this spending growth will largely be driven by the region’s national oil companies (NOCs).
“CAPEX among Asia's oil and gas companies is set to register double-digit growth in 2018, with the latest CAPEX guidance figures across 15 companies indicating a 36.3 percent y-o-y increase to $102.3 billion, from $75.1 billion,” the analysts stated.
“This spending growth will largely be driven by the region’s NOCs, many of which are armed with ample cash reserves and have become more lean and efficient due to stringent cost-saving measures undertaken over the past few years,” the analysts added.
BMI said the biggest CAPEX growth will be observed in China, with its three state owned enterprises accounting for 63 percent of the anticipated increase in Asia’s capital spend this year.
“CNOOC, PetroChina and Sinopec are targeting spending a combined $63.8 billion in 2018, an increase of 82 percent y-o-y from the $35.1 billion spent over 2017,” the analysts said.
“The focus will be on increasing gas production from existing projects and adding new domestic gas storage capacity, both to ease dependence on imported gas, especially during peak demand periods, and in support of Beijing 's broader clean-energy targets,” the analysts added.
BMI said Asia’s other large NOCs, such as Malaysia’s Petronas, Indonesia’s Pertamina, and Thailand’s PTT, have also put forth “substantially larger spending plans for the quarters ahead”.
“These largely focus on sustaining output levels at mature domestic oil and gas assets and expiring production licenses,” the analysts said.
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