Deepwater oil and gas explorers including Royal Dutch Shell (RDS.A, RDS.B) and Talos Energy (NYSE:TALO), along with contractors such as Ensco (NYSE:ESV) and TechnipFMC (NYSE:FTI), told the Scotia Howard Weil Energy Conference this week they see a revival coming, a message in stark contrast to a subdued outlook for shale at the event.
Hess (NYSE:HES), which has assets in both shale and in offshore, offered the starkest contrast between offshore and shale when CEO John Hess showed a slide about what it would take to get the same amount of oil from the Permian Basin vs. Guyana, one of the biggest offshore discoveries of its kind: the remove 120K boe/day of oil, the Permian Basin would need a $12.8B investment compared to $3.7B for the first phase of the Liza section of the Guyana project, where Hess is teaming up with Exxon (NYSE:XOM).
"Take a look back from when we were at this conference one year ago today and we’re up 25% just in terms of the number of open tenders that are out there year over year," ESV CFO Jon Baksht said. "We are seeing that increase in spending and increased activity in the offshore space today."
FTI has said it expects to total a quarterly record for inbound orders of subsea gear during the current quarter.
Subscribe for full text news in your inbox