Oil & Gas News

Industry Research: Australian Megaprojects are Fuelling 
Optimism but Development Costs Remain a Concern

GLNobleDentonAustralian megaprojects are providing a significant source of optimism amongst oil and gas professionals in the Asia Pacific region, according to research from industry technical advisor, GL Noble Denton.

Australia is listed as the world’s third most attractive investment destination by professionals questioned in the report, entitled Seismic Shifts: The outlook for the oil and gas industry in 2013. No other country in the Asia Pacific region appeared in the report’s shortlist of leading investment destinations for the oil and gas industry.

Seismic Shifts is an annual litmus test for industry sentiment in the year ahead. It was produced with input from a survey of more than 400 senior oil and gas professionals and in-depth interviews with 20 industry executives.

According to the study, multi-billion dollar projects in Australia are fuelling optimism in the oil and gas industry, with 72% of respondents in the Asia Pacific region saying they were highly or somewhat confident for the outlook of their business in 2013.

Among these ventures is Shell’s USD $12bn Prelude project, situated in offshore Australia, which is expected to be the first regional development to implement floating liquefied natural gas (FLNG) technology. The facility is expected to begin operations in 2016.

With a raft of new technologies being developed to operate in increasingly challenging environments, it is not surprising that 37% of respondents to GL Noble Denton’s research expect to increase their spending in research and development (R&D) in 2013.

As Australia’s oil and gas projects become more complex and the levels of investment in them rise, the expectation of a viable return becomes more pronounced. More than half of all respondents (53%) from Asia Pacific believe that rising operating costs are the biggest barrier to growth, well above the global average of 38%.

Richard Bailey, GL Noble Denton’s Executive Vice President for Asia Pacific, said:

“Australia remains a robust market within the in the Asia Pacific region, despite challenges posed by the global operating climate. Our research reaffirms that the country’s megaprojects are drawing huge inward investment to the country.

“However, there are fears that as these projects grow, operational costs will increase substantially. As many Australian megaprojects reach a critical phase in their development, any change in costs could be crucial to future progress. Careful forward planning and effective implementation of work is now more important than ever to ensure these concerns are not realised.”

Download a complimentary copy of Seismic Shifts from: www.gl-nobledenton.com

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