HOUSTON -- A session at CERAWeek 2009 took a look into the future of the global oil and gas industry. The panel included representatives from CERA, IHS Jane's, IHS Global Insight, IHS Herold, and Lloyd's Register-Fairplay. Among the panel's conclusions were the following:
• With a contraction in the world economy, energy demand will stall, said Sara Johnson, managing director, Global Macroeconomics, IHS Global Insight. "Petroleum consumption will decline … growth in consumption of natural gas, coal, and other fuels will slow markedly," she said.
• Oil and gas operators may be expected to reduce 2009 exploration spending by 10-20%, depending on their North American gas exposure, said Bob Fryklund, vice president, Global E&P Analysis at IHS. Internationally, he said, there will be a more balanced opportunity for exploration and field development, with Latin American on the rise.
• "There is a double whammy on evaluations for companies in the E&P group," said Andy Byrne, VP and senior equity analyst for IHS Herold, with "price being low and costs remaining stubbornly high. For firms seeking to add reserves, 2009 is shaping up to be a better year to drill for oil on Wall Street than it is to explore for oil and drill it themselves."