BDO's Energy 2020 Vision: The Near Future of Oil & Gas

December 2017

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Ready or not, the global oil & gas industry must contend with an ever-changing ‘normal’.

It’s the confluence of trends—not just the new pricing paradigm, but rapid growth in renewables along with accelerating technology advancements—that is reshaping the industry. The energy company of the future is one that has successfully figured out how to cut costs, enhance operational efficiencies through digital and technological transformation, and diversify its portfolio to include alternative energy sources.
 
Reflecting on this period of turmoil and transition, BDO’s Global Natural Resources team is looking towards the future to help oil & gas companies anticipate and plan for the challenges and opportunities ahead. We believe that to prepare for success in 2020 and beyond, oil & gas companies must strive to become “Lean, Green, Digital” machines.
 
The global predictions presented in this report are based on research and collective input from BDO’s Natural Resources leaders around the world. In addition, the practice leaders from five countries (Australia, Canada, the United States, the United Kingdom, and the Kingdom of Saudi Arabia) have provided regional predictions for the industry in their markets.
 

Summarizing BDO's Global Energy 2020 Vision for Oil & Gas

  1. Oil Prices: By 2020, low oil prices—expected to remain at or below the $60 per barrel mark—will spur Gulf Cooperation Council countries to diversify their energy mix within the power sector using auctions to subsidize renewable energy projects.  
  2. Cybersecurity: By 2020, at least five countries will see foreign hackers take all or part of their national energy grid offline through Permanent Denial of Service (PDoS) attacks.
  3. Global Energy Trade: By 2020, the growth of LNG imports and solar power will bring electricity to four in five African people.
  4. Investment in Tech: While overall spending on R&D may decline, most of the spending that does occur will go towards technologies that enhance exploration and production (E&P) efficiencies.
  5. Data Democratisation: By 2020, the average E&P company will make use of 10 percent of its big data—up significantly from today, but nowhere near full potential.
 



Country-Specific Predictions: Summarizing BDO USA's Energy 2020 Vision for Oil &Gas

  1. Global Energy Trade: By 2020, 30 percent of Liquefied Natural Gas (LNG) export capacity will be built in the US, making it one of the largest gas exporters in the world.
  2. Cybersecurity: The US national electric grid will be the target of a PDoS by 2020.
  3. New Technology: Digitization and technological advancements—the next generation of seismic imaging and predictive analytics—will nearly eliminate exploration risk for oil & gas drilling and will propel the US industry to achieve a drilling success rate between 95 to 100 percent.
  4. Energy Infrastructure: In 2020—a US presidential election year—there will be discussions about constructing a natural gas pipeline from the US to Central America, using Mexico as the route.
  5. Renewable Energy: The US renewable energy market will provide 20 percent of the nation’s electricity by 2020.


Country-Specific Predictions

       
 
Agree or disagree with our predictions? We want to know—contact one of the International Global Natural Resources leaders here
 

Charles Dewhurst
Global Natural Resources Industry Practice Leader
Co-Leader of BDO USA’s Natural Resources practice
713-548-0855
cdewhurst@bdo.com
 
Tom Elder
Co-Leader of BDO USA’s Natural Resources practice
713-407-3959
telder@bdo.com
 


This report was orginally published by BDO Global.