WTI Crude

Loading...

Brent Crude

Loading...

Natural Gas

Loading...

Gasoline

Loading...

Heating Oil

Loading...

Rotate device for more commodity prices

IEA Chief Expects OPEC Deal To Work

IEA Chief Expects OPEC Deal To Work

Fatih Birol, the executive director…

The Wider Ramifications Of The OPEC Deal

The Wider Ramifications Of The OPEC Deal

The OPEC deal has had…

Expert: North Sea Oil Still Offers Profit To The Wise

North Sea

In times of distress, there is opportunity, and the North Sea’s oil riches are still ripe for anyone wise enough to play them, says a key financial expert.

The oil industry in the North Sea still has plenty of money to offer in the next upcycle to the players with longer-term vision, financial expert Colin Welsh told Energy Voice in an interview.

Currently, the oil industry is at such point in the cycle that it’s a time of distress for many, but also a time of opportunity, Walsh said.

“I think there’s life in the old dog yet. I worry a bit, because all of the E&P companies are spending a whole lot less money offshore and the money they are spending is in short-cycle assets like North American shale,” according to the expert.

Walsh called out the oil companies for lacking long-term vision and just thinking short-term.

“You would think it would have been an industry that would have learned to be a lot longer-term in its thinking by now. That it would have accepted there are going to be these booms and busts,” the expert noted.

The oil industry has repeatedly failed to change its short-term thinking, while a vision for the longer run would help the sector become a less “dysfunctional industry”, Walsh added.

The only long-term consistent thing in the industry is that it is grand at talking and “terrible at taking any action”, the expert said.

Still, he admitted that “we are in the middle of the worst downturn in living history”.

When things get better, the North Sea will play a significant role in the coming upcycle, according to Walsh.

In the E&P business, however, new players with new capital and new business models are needed to upend the good old ways of the sector, the expert said.

According to leading trade association Oil and Gas UK, investment into the UK Continental Shelf (UKCS) sea areas, which incorporates all of the UK-held parts of the North Sea, has fallen down to US$11.32 billion (9 billion British pounds) this year, compared to a record US$18.62 billion (14.8 billion British pounds) two years ago.

By Tsvetana Paraskova for Oilprice.com 

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Clem Fandango on December 03 2016 said:
    "new players with new capital and new business models are needed" - sounds just like Hurricane Energy!

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News