In the ongoing high price environment there are some major, looming challenges, an APPEX London gathering of about 300 was told in March.
APPEX London, which ran over three days in March, is operated by AAPG with endorsement from the Geological Society of London, the Energy Institute and the International Association of Oil and Gas Producers. It included an international prospect expo that drew 33 exhibitors and information forums.
IHS coordinated the APPEX Global Perspectives Forum, with ABN-AMRO sponsoring the Finance Forum.
Challenges cited by speakers include:
- Heightened political uncertainties, as free market politics give way to leftist “populist” governments with increasing state control of resources.
- A more competitive landscape, as national oil companies begin competing outside the country boundaries and with each other.
- E&P costs are rising at a double-digit pace while the discovery size is shrinking.
All this while a manpower crisis is looming as companies look to replace half of its work force that will retire in seven-10 years from a populace which, according to an October 2005 Harris Poll, ranks the petroleum industry reputation at less than that of the tobacco industry.
Despite these obstacles, however, there are opportunities, including:
- Expanded capacity expansion plans.
- Growing investment.
- More drilling in mature areas.
- New technology.
- New frontiers becoming available.
The program also looked at the opportunities in specific geographic areas. A Latvia official at the meeting told Upstream magazine that a second offshore licensing round was forthcoming. Upstream also included a report on a talk on reservoir evaluation by President Pete Rose.