GCC Drilling Remains Strong Despite Upstream Capex Cuts

GCC countries bucked the global trend of falling global upstream capex to keep drilling at record levels in 2016. While the IEA expects global capex to have fallen 24% in 2016, heavyweight producers Saudi Arabia and Abu Dhabi both ran record numbers of rigs in 2016: monthly averages of 125 and 48 respectively, according to Baker Hughes figures.

The national oil companies (NOCs) in the GCC have capitalized on costs plunging alongside oil prices since the second half of 2014. Contracts have been signed at well below the previous market rate.

According to the IEA’s World Energy Investment report, spending by Middle East NOCs fell by 30% between 2014 and 2016 compared to a 43% global drop from $777bn in 2014 to $443bn last year ( MEES, 16 September 2016 ). (CONTINUED - 662 WORDS)

DATA INSIDE THIS ARTICLE

table Annual Average Rig Counts*: GCC Soars Amid Iraq, Egypt Retrenchment
chart GCC Drilling* Hits Annual Record
chart ...With Abu Dhabi Leading The Way
chart Saudi Arabia Ramps Up Gas Drilling
chart Kuwait Drilling Dips From Record High
chart ...With Oman Also Down Slightly*