Oil and Gas
Completion Date:
Project Overview
In the oil and gas industry, executing large capital projects in E&P will continue to pose daunting challenges. Companies that are ready to take an honest look at their performance and practices in this area have a better chance of surmounting those challenges and can expect fewer delays and cost overruns with their LCPs (lost circulation problem). As a result, their capital efficiency should start to improve.
By grappling with tough questions about their LCP capabilities, E&P executives can begin gaining insights into what capabilities they need to strengthen in order to improve their LCP delivery approach. The strengthening of those capabilities requires an up-front investment of time, effort, and financial and human resources. But such an investment can pay big dividends — in the form of LCPs that come in on time and within budget.
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Problem Statement
Oil and gas production experienced a world-historic challenge in 2020 when the COVID-19 pandemic hit, leading to negative oil trade numbers in April 2020. In 2020, the capital expenditure for the upstream oil and gas projects worldwide fell more than 25% which was approximately $305 billion. The forecast for 2021 is expected to increase by 2% to $310 billion below pre-pandemic levels (Statista). The low oil and gas prices led to oil companies reducing both production and cost. The restrictions on movement and consumer demands due to the pandemic have caused many major and super companies to merge in an attempt to survive while 46 North American exploration and production (E&P) companies filed for bankruptcy in 2020 only.
Executive Summary
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