Session 26. Oral Presentation for: Unpacking the decline: Australian E&P capital trends in a global context
Anish Philips A *A
Anish Philips is a Senior Market Analyst for Supply Chain with Rystad Energy and specializes in the oilfield service and equipment sectors. He brings six years experience throughout the energy industry, specifically in Upstream O&G, Mining and Battery Technology. Anish has worked in various roles in the field for both the O&G and Mining Industries in Australia prior to 2021. After moving to the UK in 2021, he worked with a seismic technology start up and with UK battery companies such as About:Energy, Field Energy and Eel Power. At Rystad Energy he will take his experience back to the Australian market in August 2024 to leverage his expertise and develop industry relationships in O&G, Mining and Battery materials in Perth, Australia. |
Abstract
Presented on Thursday 23 May: Session 26
In 2015, ASX-listed exploration & production (E&P) companies raised almost A$12 billion in capital, marking a peak in their recent fundraising efforts. However, this has declined annually since, with only about A$1.2 billion raised in 2022, despite lower Reserve Bank of Australia (RBA) interest rates compared to 2015. The investment ratio, measuring investments relative to cash from operations, plummeted from 187% in 2015 to 20% in 2022. Globally, public E&P players averaged 97% in 2015 and 31% in 2022. Going forward, we expect Australia’s investment ratio to average 31% between 2023 and 2025, compared to the global average of 49%. This paper explores Australian E&P capital expenditure trends against global patterns, attributing the decline to factors such as environmental and legal risks, limited access to capital, regulatory hurdles, and approval delays. For instance, offshore environment plan approvals now take over a year on average, compared to 4 months in 2017. Despite high oil and gas prices, spare infrastructure capacity, and domestic gas market shortfalls, investment activity in Australia wanes. Additionally, merger & acquisition (M&A) activity, often indicating industry interest, dropped by nearly half in Australia in 2022 compared to 2018. This paper examines why Australia lags in capital spend, citing environmental, regulatory, and approval challenges. While global trends show increased spending, Australia’s oil and gas sector faces headwinds in attracting investments and M&A activity.
To access the Oral Presentation click the link on the right. To read the full paper click here
Keywords: Australia, banks, bonds, capital, delays, equity, export, gas, investments, LNG, M&A, market, policies, policy, prices, regulatory challenges, risk, spending.
Anish Philips is a Senior Market Analyst for Supply Chain with Rystad Energy and specializes in the oilfield service and equipment sectors. He brings six years experience throughout the energy industry, specifically in Upstream O&G, Mining and Battery Technology. Anish has worked in various roles in the field for both the O&G and Mining Industries in Australia prior to 2021. After moving to the UK in 2021, he worked with a seismic technology start up and with UK battery companies such as About:Energy, Field Energy and Eel Power. At Rystad Energy he will take his experience back to the Australian market in August 2024 to leverage his expertise and develop industry relationships in O&G, Mining and Battery materials in Perth, Australia. |
