Oil and Gas

Oil & Gas Industry Investment & Technology Study

The oil and gas industry is currently facing dynamic changes influenced by oil prices, geopolitical issues, and the growing demand for technological innovation. As the industry strives to optimize costs and investments, companies are increasingly focused on finding the most efficient capital investments and identifying technological innovations that can drive operational improvements. The oil & gas sector, especially Exploration and Production (E&P) companies, is dealing with challenges such as fluctuating oil prices, the need for cost control, and the integration of new technologies like AI, Blockchain, and IoT into daily operations.

We undertook a global quantitative study to understand the spending trends, capital investment decisions, and technology priorities among oil & gas decision-makers. This study aimed to capture key insights from E&P professionals and provide a forward-looking perspective on how these decision-makers plan to navigate market conditions in 2020.

Objective

The primary objectives of the survey were:

Oil Price Impact on Capital Investment:
- To determine how oil price fluctuations influence capital investments and how companies expect their spending behavior to evolve in 2020.
- To identify the price thresholds at which companies increase or decrease their capital spending in Exploration and Production (E&P).
Cost Drivers and Control:
- To understand the key cost drivers in the industry and assess their impact on overall spending.
- To explore operational constraints and identify which challenges are most critical for companies in the upcoming year.
Technology and Innovation Focus:
- To evaluate the relevance of emerging technologies such as AI, Blockchain, and IoT for oil & gas companies.
- To gauge the industry’s focus on digital transformation and automation technologies that can drive efficiencies in exploration, production, and operations.
Investment Priorities and Industry Trends:
- To measure investment trends across different stages of the oil & gas supply chain and identify priority areas for capital investments.
- To determine the investment focus within regions and sub-sectors (e.g., shale, deepwater, LNG, EOR).
Industry Challenges:
- To understand the challenges facing the oil and gas industry, from infrastructure issues to regulatory pressures.

Jasper Colin Approach

To achieve these objectives, Jasper Colin’s Executive Decision Insights methodology was applied. By utilizing multi-method research, including quantitative surveys, qualitative interviews, and behavioral data analysis, we were able to gather actionable insights from E&P professionals globally. This methodology helped identify key decision-making factors and measure the industry's investment priorities and technological adoption.

Key Segmentation:

Advanced Analytics:

Investment Scenarios: Based on the survey data, we applied predictive modeling to forecast investment trends and spending priorities, considering fluctuating oil prices and potential cost drivers.

Methodology

The survey was conducted online and targeted decision-makers in the oil & gas sector, specifically within Exploration and Production (E&P). The respondents were selected based on their involvement in strategic investment decisions, capital budgeting, and technology adoption.

Survey Structure:

Respondent Qualification:

Respondents had to be managers or above in companies with revenues greater than $50M. The target audience excluded oilfield service and equipment companies.
The primary focus was on those working in Exploration and Production (E&P) functions within the oil and gas sector.

2. Oil Price Impact & Capital Investment:

Respondents were asked to rate how changes in oil prices (e.g., $45-55 per barrel) affect their capital spending plans. We also gathered insights on their expected capital spending compared to the previous year.

3. Cost Drivers & Operational Constraints:

A set of questions assessed the importance of various cost drivers, such as drilling, pumping services, sand and consumables, and well services.
We also explored operational constraints, including workforce challenges, service capacity, and regulations, to understand the primary hurdles impacting spending decisions.

4. Technology & Digital Transformation:

Respondents rated the importance of technologies like horizontal drilling, 3D seismic, intelligent well completions, and AI for their organizations.
We measured the adoption potential for automated inspection tools, drone technology, and reservoir simulation as part of their future investment plans.

5. Investment Priorities:

The survey asked respondents to rank their investment priorities across different segments of the oil & gas supply chain (e.g., exploration, drilling and completion, field development).
Key challenges such as geopolitical conflicts, regional legislation, and local content requirements were also evaluated for their impact on investment decisions.

Result

Global Insights: The survey captured a global perspective on oil price impact and investment trends. The regional segmentation provided deep insights into how different areas (e.g., North America, Middle East) are adjusting their capital spending and adopting new technologies.
Spending Behavior Analysis: Through advanced statistical modeling, we identified spending behavior patterns, which were linked to oil price projections and cost drivers such as drilling costs and well services.
Technology Adoption Forecasting: By focusing on emerging technologies such as blockchain and AI, the survey highlighted the oil and gas industry's readiness for digital transformation. This allowed R&D teams to identify gaps in current offerings and predict future technology adoption trends.

Impact