‘non core’ assets and businesses,rela- tionship and contractor management and capital efficiency. A key feature,according to Brogan, is
changing perceptions of risk. The top 10 business risks to oil and gas compa- nies in 2010 were (year earlier rating in
brackets):
Uncertain energy policy (2) Access to reserves (1) Cost containment (4)
Worsening fiscal terms (5)
Climate and environmental concerns (7) Price volatility (3)
Human capital deficit (6) Supply shocks (9)
Overlapping services offerings for IOCs and OFS (oil field service) companies (8)
New operational challenges including unfamiliar environments (new) In addition,he explained, there is an
evolving risk profile in partnerships,in which companies are seeking to use con- tractors in the most appropriate way while clearly defining liabilities and oblig- ations of the parties involved. Brogan then showed that partnership activity looks set to increase and identified the
new partnership trends as:
Use of joint ventures to pool capital and mitigate risks in large projects.
Governments increasingly encouraging
and brokering oil and gas sector alliances.
New partnerships between reserves-rich NOCs frommajor importing areas.
NOCs buying into joint ventures to gain access tomarkets and expertise.
Increasing numbers of joint-venture partners in individual projects due to their complexity and cost. He then went on to explain that the
key partnership drivers are technology, capital and access to demand/supply. After enumerating the unique selling
points for IOCs,Brogan summarised them as ‘being comfortable with com- plexity’. Finishing his presentation by listing the partnership drivers for the NOCs,he then opened discussion to the panel. The first speaker was Malcolm Brown,Senior Vice President, Exploration,BG Group, who noted these are ‘difficult times’,with old fields playing out and the need to replace them. He pointed out that the world is not awash with gas as often portrayed,with BG figures showing a 200bn cm/y gap by 2020 – meaning at least 150bn cm/y of new capacity needs to be developed,requiring $2tn of investment. He talked of the need for partnerships with NOCs,illustrating this
with BG’s involvement in Brazil which has provided an array of opportunities. Daljit Gill,Vice President for Global Business Pursuit,Weatherford,then pointed to the move to greater respon- sibilities for service companies. He also explained that NOCs can be great busi- ness partners,who, as a group,are becoming more important to compa- nies such as Weatherford. The IOCs retain many advantages in terms of technical capabilities,multi-national staff,access to capital and HSE experi- ence,he said. There is,however, a clear move away from IOCs owning equity to production sharing contracts (PSCs) and fees/contracts with producer govern- ments. Dr Randall Gossen FEI,Vice President,
Global Business Relations,Nexen, and President of the World Petroleum Council,noted that in the case of Canadian NOCs,PetroCanada had become an IOC. There are cultural and philosophical differences between IOCs and NOCs,he said, but governments can change the rules. He explained that value drivers are the same for both groups,although for some NOCs the driver is securing reserves and for others it is defending the national interest. He also noted that the industry
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