With oil prices in a protracted period of stability, oil companies are gradually getting the confidence to invest once again, the chief executive of Australia’s biggest independent oil and gas producer indicated Monday.
“It’s a nice spot where it is at the moment, around $60 and $65 per barrel,” Peter Coleman, CEO of Australian oil and gas producer Woodside Petroleum, told CNBC at the Credit Suisse Asian Investment Conference in Hong Kong.
“You can almost say that $65 today is kind of the new $80 of what we were three or four years ago, simply because we’ve got cost down and we’ve got margin back into our business,” he said, adding that current price levels meant that operations are sustainable today.
On Monday, oil prices pared some of their gains made after settling above $62 in the last session.
Although Coleman cautioned that it was still too early to budget for $65 oil, he also acknowledged bullish developments in the space.
“At this price, you’re starting to see new projects go to final investment decisions so people are starting to get that confidence again that they can invest,” Coleman said, adding that plenty of companies are making substantial investments in the renewable energy space.
According to Coleman, companies are also starting to change their portfolio mix in a bid to tackle their carbon footprint.
“You can see they’re going more gas-oriented. They’re actually starting to say the mantra is moving from being an oil and gas company to being a gas and oil company,” he said.
Woodside announced earlier in the month that its intention to buy Exxon Mobil’s 50 percent stake in the Scarborough gas field in Australia had been approved by BHP, a stakeholder in the development.
Source: CNBC
