Genel Energy chief executive Tony Hayward will give the keynote presentation in today’s SPE Offshore Europe session, The Independent Oil Company—Mighty oaks from little acorns grow (10-12.30pm, Gordon B). We asked the former BP chief executive, Glencore director and chairman of CompactGTL, for his views on the industry.
What are the main strengths of the independent oil company and should the majors try to learn a trick or two from them?
Independents have enjoyed a very successful decade. It was independents who opened up the new oil and gas provinces of West and East Africa and the eastern Mediterranean and to a lesser extent offshore Brazil—and independents who pioneered the breakthrough in shale gas and shale oil in North America. It is independents who have led the way in politically higher-risk areas, such as the Kurdistan region of Iraq. The super majors have for the last decade been followers, not leaders, in exploration and increasingly focused their resources on major development projects, which they are uniquely qualified to execute.
What/where are the main challenges to independents?
In today’s environment, the major challenge for independents is access to capital at a reasonable cost.
The Middle East/North Africa—will this region ever be stable and what role can independents play here?
The Middle East and North Africa are clearly going through a period of major political change that will probably last a decade or more. Having said that, the region provides plenty of opportunity for those prepared to take political risk and invest time and resources to manage it.
What role do national oil companies play and is this changing?
The NOCs will continue to emerge as an increasingly powerful force in the global oil and gas industry. The relationships they forge will be driven by their own particular circumstance. It will be a long time before they challenge the super majors in terms of their global capability or the independents in terms of their ability to find and take technical or political risk (because in most cases they don’t need to).
What emerging technologies do you see as offering the greatest potential to the industry?
In terms of finding oil and gas the biggest impact in recent years has been continued developments in seismic acquisition and processing. This is likely to continue. In terms of unlocking new reserves, drilling and completion technology.
How long away are we from commercial production of CompactGTL?
We have a commercial demonstration plant running in Brazil at 20 barrels/d and expect to begin construction of the first commercial plant of 1000-2500bopd in the course of the next year. The technology provides a great opportunity to tackle the challenge of flared gas in many parts of the world.
What is the biggest challenge to the industry, as a whole?
Ensuring that the industry has enough qualified and trained people to meet the world’s rising demand for oil and gas.
Image: Tony Hayward