Energy groups ax $100B in total spending after oil rout
Article by: Carl Surran, SA News Editor, Seeking Alpha: 18 May 2015
Energy groups ax $100B in total spending after oil rout
- More than $100B of spending on at least 26 major projects by the world’s energy companies has been slowed, postponed or canceled in the wake of plunging oil prices, including Royal Dutch Shell (RDS.A, RDS.B), BP, ConocoPhillips (NYSE:COP) and Statoil (NYSE:STO), according to a Financial Times analysis.
- One of the biggest developments to be shelved, Shell’s Arrow liquefied natural gas plant in Australia, accounted for almost a quarter of the planned spending reduction.
- Western Canada is suffering the most from the retrenchment, with nine Canadian oil sands projects pulled back, each ranging from $1B-$10B in planned expenditure, the analysis says.
- According to Morgan Stanley, which looked at capex guidance for 2015 from more than 120 companies, investment is expected to drop by a quarter this year to $389B from $520B.
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