BMI's 2014 Exploration Hotspots
BMI View: We believe the Gulf of Mexico, New Zealand, Morocco, the US' Tuscaloosa Marine Shale play and Russia's Bazhenov shale play will all see a noticeable uptick in drilling and exploration over 2014. These plays - our picks for the top five 'global exploration hotspots' for 2014 - will be unlocked by new technological innovations and attractive regulatory environments.
Our research suggests that capital investment in the upstream sector will decline in 2014, as a number of the supermajors and larger independents seek to consolidate gains from the ramp-up in investment (see 'E&P Capex Tapering Amidst Shifting Fundamentals', January 6). Nevertheless, despite the downshifting project cycle, there are a number of countries and regions in the upstream space that will buck this trend and are likely to see a substantial uptick in new investment and drilling activity in the year ahead. A mix of emerging and re-emerging oil plays, we believe that these 'global hotspots' are well positioned to benefit from a unique combination of favourable regulatory environments and/or high below-ground prospectivity - set to be unlocked by new technology.
Below are our top five picks for 2014 global exploration hotspots, broken up into three categories: re-emerging plays (the Gulf of Mexico), nascent opportunities ready to emerge onto the global radar (New Zealand, Morocco and the Tuscaloosa Marine Shale play), and lastly Russia's Bazhenov shale play, which we see as promising though we remain concerned about the above-ground environment. Just missing out, but still a favourite is Argentina.
|Heading Up After A Long Fall|
|US - Gulf of Mexico Rig Count|