No Match Found
Boom to bust – the familiar cycle for the commodity business of oil and gas – is once again rearing its head. Oil prices have recently declined over 50% from their peak. Natural gas prices are following suit, with the excess supply in the market. How low will prices go? How long will the price decline last? These are the burning questions of the day. But industry experts know that to provide products for the future, the planning and investment must continue today. Throughout the value chain, oil and gas projects take years to develop, and price fluctuations are all a part of the process. At PwC, our global oil and gas professionals understand the challenges that our clients face, along with the uncertainties and risks they have to manage, and we provide the help that companies need to succeed throughout the business cycle.
The energy industry requires long lead times for new projects, and even though the current global economy is struggling, the world’s population continues to grow. With this growth, energy demand will increase. Weighing the risks versus benefits of new projects, new products and how much capital to invest, oil and gas companies also have to consider regulatory, safety and environmental concerns. Balancing the need to supply the world with hydrocarbons, companies are also looking at investments in alternative energy sources, including unconventional sources, biofuels, renewable energy sources, and ways to improve energy efficiency.
So at PwC, we are not only watching these developments in the industry, but we are analysing these changes from the perspective of how they will impact our clients, and how we can best help companies prepare and manage the changes. We examine the issues, and build teams of subject matter specialists who develop appropriate solutions through our assurance, tax and advisory services. Our experienced professionals are on the ground in 158 countries around the world contributing local insight and understanding.
In response to strong global demand for energy, particularly in the Asia-Pacific region, the Australian oil and gas industry is in the final stages of an unprecedented phase of investment involving some of the largest projects ever undertaken in this country. This new capacity, primarily in both onshore and offshore gas rather than oil, will dramatically expand operational output over the next two decades, providing a substantial boost to national income and taxation revenue.
With strong investment in the sector, particularly in northern Western Australia, Queensland and the Northern Territory, proven natural gas reserves have increased six-fold over the past 30 years to around 3.5 trillion cubic metres. On the back of current investments, around 100 million tonnes of incremental LNG production is estimated to come online between 2105 and 2020. As such Australia is set to challenge Qatar as the world’s largest exporter of liquefied natural gas (LNG) over the next decade.
Following recent significant declines in the global oil price as the local gas sector moves from its investment and construction stage to operational production the local industry will need to focus much more on cost control and productivity to be competitive in the international market. PwC has industry-specific oil & gas expertise and services to help companies improve productivity and cost competitiveness across the value chain from upstream field development and operations through to downstream logistics and marketing.
In Australia we have 110 energy-dedicated professionals in key energy centres, including Melbourne, Sydney, Brisbane and Perth. Australian-based PwC oil & gas industry experts have recently authored and published two major thought leadership studies on the global and local oil & gas industry: Driving value in upstream oil & gas (2013) and Best in Class: How upstream gas can work smarter (2014)
EU&M Matters is PwC's regular publication for the Energy, Utilities and Mining sectors. Each edition features our latest thought leadership and industry insights, exploring current and future trends from Australia and across our global network.
Industry Leader, Energy, Utilities & Resources, PwC Australia
Tel: +61 439 345 045
National Oil & Gas Assurance Leader, PwC Australia
Tel: +61 434 142 105
Partner, Energy Transition, Strategy& Australia
Tel: + 61 478 303 103
Brisbane Tax and Markets Leader, PwC Australia
Tel: +61 421 288 623
Partner, Energy Transition, PwC Australia
Tel: +61 404 038 888
Partner, Energy Transition, PwC Australia
Tel: +61 432 757 447