talk about meaningless soothing platitudes!
by Andreas Exarheas Rigzone Staff
Tuesday, May 02, 2017
Now is the time for the deepwater industry to “come back,” according to Roger W. Jenkins, president and CEO of Murphy Oil Corp.
Jenkins conceded that 2016 was a “very difficult” year for the deepwater oil and gas sector during a presentation at the Offshore Technology Conference (OTC) in Houston, but was optimistic about the future of the industry.
“We’re at a very low point in the cycle here,” Jenkins told oil and gas delegates at OTC.
“This has gone on for 30+ months and now is the time for deepwater to come back, in my view,” he added.
Jenkins warned, however, that national oil companies, service providers, drillers and operators will need to collaborate to get good returns from the deepwater sector.
Deepwater has suffered during the oil price drop, losing investment from a number of oil and gas companies.
there is no reason for the deepwater GoM to come back! as long as demand for crude can be supplied by lower cost onshore fields there is no economic justification for extremely expensive deepwater offshore projects. This is the new reality of the fracking revolution which itself has been one of the driving forces behind the great drop in the price of crude. Now that oil can be produced onshore for far less than it can be offshore then why should the big players spend that money to put in the production offshore when they can simply buy crude from someone else for way less. Right now the downstream side of energy is very weak but the upstream side is maintaining its strength. Global demand has stabilized and there is money enough to be made in refining and distribution.
I believe that until there is a massive rise in global demand for crude which cannot be met with onshore production then the offshore is not going to rebound. Why the big offshore operators failed to see the fracking revolution coming is the biggest mystery of all?