The global oil and gas industry has experienced a steady decline in the last three years primarily driven by the African and Middle East region, but the current instability in the industry does not deter a positive outlook as operators are positive that the industry will continue to grow over the next three years. It is expected that the industry will continue to be profitable based on an average benchmark oil price of $85-$90 per barrel.
Operators are implementing cost reduction strategies and focusing on operational excellence and innovation as a way of increasing their profitability despite declining revenue.
Local content has become a significant issue for the oil & gas industry, especially across Africa. Given the drive by governments to enable locals play more significant roles within the energy sector, we would expect increased pressure on operators to justify the utilisation of ‘non’ local resources. Nigeria has recorded some measure of success in this light.