2018 has started on a positive note for the global oil and gas industry. Global demand for energy is steadily developing and together with the combined effect of OPEC cuts to production volumes and the postponement of investment decisions, the industry is experiencing an upwards trend in crude oil prices.
Energy industry stocks are strengthening on the back of major players reporting healthier results and this renewed confidence is prompting a resurgence in industry investment that has been suppressed since the oil price collapsed in late 2014. GEIDCO has agreed to outline plans with the United Nations Department of Economic and Social Affairs; the UN Economic and Social Commission for Asia and the Pacific; the Arab League; the African Union, and the Gulf Cooperation Council Interconnection Authority.
Players in the U.S. unconventional sector are leading the return to growth and are increasing their exploration and production activities. This is reflected in most other oil producing regions of the world. Oil Field Service companies, such as Schlumberger, Halliburton and BHGE, who provide the equipment and expertise to explore and complete new wells, are positioned to benefit from this new market environment.
Prysmian Group, the worldwide leader in the cable industry, is also seeing increased activity across all segments of the O&G industry. Prysmian Oil & Gas is working with National and International Oil Companies (NOCs & IOCs) and are supporting major Engineering, Procurement and Construction (EPC) companies as they plan major industry infrastructure projects. NOCs and IOCs have used the period of lower energy prices to review their cost structures and have found ways to reduce their project breakeven prices. This means that they are now able to invest to bring marginal fields into production.
However, there has been significant consolidation and job cuts across the industry - it is estimated that headcount has reduced by 35% in the upstream segment since the 2013/14 peak – that will clearly impact the speed of recovery, but over the longer-term, commentators believe that this will encourage the development of advanced technology to drive cost efficiency and reliability.
Prysmian is responding to this demand. The company is working across our global manufacturing network to reduce lead-times and costs and are introducing new solutions that offer reliability, enhanced performance and extended service life.
Electrical Submersible Pump (ESP) cables are a good demonstration of this effort. ESPs are used to artificially lift and increase the flow of oil from a production well. It is critical that the pump motor has a reliable electrical power supply, so the ESP cable must perform over an extended operating life. Prysmian has pioneered the development of reliable ESP cables for more than thirty years and its success in the market with major oil field service companies has been a product of the continuous stream of innovations from the Group’s research and development teams. In a continuously challenging market, extended operating lifetime of an ESP cable is critical to ensure economic production.
Prysmian has created a family of products that operate in the harshest environment and we are committed to invest to help operators extend the operating life of our ESP cables.
The industry is experiencing an upwards trend in crude oil prices