Oil and gas exploration spending will recover from historic lows to average $22 billion a year over the next five years, according to Wood Mackenzie.
Attractive economics, greater emphasis on energy security and the discovery of new resources will incentivise NOCs (national oil companies) and energy majors to boost exploration activity, the consultancy said in a new report.
“Explorers will become bolder in the coming years,” said Julie Wilson, director of global exploration research at Wood Mackenzie.
Oil and gas companies reported record profits last year after Russia’s invasion of Ukraine pushed Brent crude, the benchmark for two thirds of the world’s oil, to nearly $140 a barrel.
Brent, which has since given up most of its gains, is currently trading at $83 a barrel as Russian crude continues to flow into the market despite harsh sanctions.
Wood Mackenzie, which expects exploration spending to increase by 6.8 per cent this year over 2022 levels, said full-cycle returns have been consistently above 10 per cent since 2018 and exceeded 20 per cent in 2022.
“These positive results have increased confidence in exploration,” Ms Wilson said.
“Improved results are down to many factors. Portfolio high grading coupled with greater discipline in spending and prospect choice mean only the best prospects are drilled and waste is minimised,” she added.
Wood Mackenzie said that deepwater and ultra-deepwater exploration would provide the most growth opportunities in the long term.
The Atlantic Margin of Africa and the gas-rich Eastern Mediterranean will experience the highest growth, the consultancy said.
“There are areas where leads and prospects are being worked up with recent seismic data, for example Uruguay, southern Argentina and deepwater Malaysia,” Ms Wilson said.
In a report last month, Wood Mackenzie said the annual oil and gas investment does not need to rise substantially from current levels of $500 billion to meet peak demand in the 2030s.
Spend levels “not much higher” than the current run-rate can deliver the supply needed to meet demand through to its “peak and beyond”, the consultancy said.
International oil majors have reduced spending over the past few years under increasing pressure from governments and institutional investors.
The International Energy Forum has estimated that annual oil and gas upstream spending needs to increase to $640 billion by 2030, from $499 billion last year, to ensure adequate supplies.
Energy industry heads have blamed underinvestment in the sector for structural imbalances and growing volatility in the oil market.
Global oil demand is expected to expand by 2.2 million barrels per day this year, with China accounting for more than 70 per cent of the growth, according to the International Energy Agency.
However, growth in crude consumption is expected to slow to one million bpd next year as the post-pandemic economic rebound runs out of steam, the IEA said in its monthly oil market report last week.
Opec expects healthy oil market fundamentals in the second half as the global economy continues to recover from the coronavirus pandemic.
The group has forecast global oil demand growth of 2.4 million bpd for this year and 2.2 million bpd for 2024.
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
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Killing of Qassem Suleimani
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
F1 The Movie
Starring: Brad Pitt, Damson Idris, Kerry Condon, Javier Bardem
Director: Joseph Kosinski
Rating: 4/5
GROUPS AND FIXTURES
Group A
UAE, Italy, Japan, Spain
Group B
Egypt, Iran, Mexico, Russia
Tuesday
4.15pm: Italy v Japan
5.30pm: Spain v UAE
6.45pm: Egypt v Russia
8pm: Iran v Mexico
Citadel: Honey Bunny first episode
Directors: Raj & DK
Stars: Varun Dhawan, Samantha Ruth Prabhu, Kashvi Majmundar, Kay Kay Menon
Rating: 4/5
MATCH INFO
Crawley Town 3 (Tsaroulla 50', Nadesan 53', Tunnicliffe 70')
Leeds United 0
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
David Haye record
Total fights: 32
Wins: 28
Wins by KO: 26
Losses: 4
The specs: McLaren 600LT
Price, base: Dh914,000
Engine: 3.8-litre twin-turbo V8
Transmission: Seven-speed automatic
Power: 600hp @ 7,500rpm
Torque: 620Nm @ 5,500rpm
Fuel economy 12.2.L / 100km
Gothia Cup 2025
4,872 matches
1,942 teams
116 pitches
76 nations
26 UAE teams
15 Lebanese teams
2 Kuwaiti teams
Global Fungi Facts
• Scientists estimate there could be as many as 3 million fungal species globally
• Only about 160,000 have been officially described leaving around 90% undiscovered
• Fungi account for roughly 90% of Earth's unknown biodiversity
• Forest fungi help tackle climate change, absorbing up to 36% of global fossil fuel emissions annually and storing around 5 billion tonnes of carbon in the planet's topsoil
UAE currency: the story behind the money in your pockets
How has net migration to UK changed?
The figure was broadly flat immediately before the Covid-19 pandemic, standing at 216,000 in the year to June 2018 and 224,000 in the year to June 2019.
It then dropped to an estimated 111,000 in the year to June 2020 when restrictions introduced during the pandemic limited travel and movement.
The total rose to 254,000 in the year to June 2021, followed by steep jumps to 634,000 in the year to June 2022 and 906,000 in the year to June 2023.
The latest available figure of 728,000 for the 12 months to June 2024 suggests levels are starting to decrease.
THE BIO
Favourite book: ‘Purpose Driven Life’ by Rick Warren
Favourite travel destination: Switzerland
Hobbies: Travelling and following motivational speeches and speakers
Favourite place in UAE: Dubai Museum
Scoreline
Syria 1-1 Australia
Syria Al Somah 85'
Australia Kruse 40'
Total eligible population
About 57.5 million people
51.1 million received a jab
6.4 million have not
Where are the unvaccinated?
England 11%
Scotland 9%
Wales 10%
Northern Ireland 14%
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UAE currency: the story behind the money in your pockets
How Islam's view of posthumous transplant surgery changed
Transplants from the deceased have been carried out in hospitals across the globe for decades, but in some countries in the Middle East, including the UAE, the practise was banned until relatively recently.
Opinion has been divided as to whether organ donations from a deceased person is permissible in Islam.
The body is viewed as sacred, during and after death, thus prohibiting cremation and tattoos.
One school of thought viewed the removal of organs after death as equally impermissible.
That view has largely changed, and among scholars and indeed many in society, to be seen as permissible to save another life.
