News listings

energy-pedia development and production

As project economics rebound, upstream FIDs to increase in 2024, with focus on deepwater resources - Wood Mackenzie

15 Mar 2024

Photo - see caption

Up to 30 upstream projects larger than 50 million of barrels of oil equivalent (boe) could reach FID in 2024, an increase from 22 in 2023, according to a new report from Wood Mackenzie.

The Wood Mackenzie report 'Class of 2024: benchmarking this year’s upstream FIDs' states that project activity will increase this year, with a total of $US125 billion in investment and the potential for 14 boe up for sanction.

'With many projects delayed or postponed, we expect operators to commit to more projects in 2024 than last year,' said Ross McGavin, principal analyst at Wood Mackenzie. 'National Oil Companies (NOCs) in the Middle East will control the most projects, but the Majors will be busy as well, particularly as they prioritise advantaged deepwater resources.'

According to Wood Mackenzie’s Lens Upstream, as the number of projects rises in 2024, project breakevens are projected to fall, with an associated bounce back in returns (IRRs) which dipped in 2023. The class of 2024 projects require an average of US$47/bbl to generate a 15% IRR, slightly below the class of 2023’s US$49/bbl. The weighted average IRR for the class of 2024 is 23%, helped by a higher liquids weighting of 57% in 2024, compared to 2023’s 46% and the five-year average of 51%.

'The higher liquids weighting and higher long-term price assumptions will improve IRRs for this year’s projects,' said McGavin. 'Most payback periods are less than eight years from FID, as operators focus on rapid execution, lower unproductive capital, and higher returns.'

Emissions intensity below global onstream average

With a significant emphasis on deepwater projects and advantaged barrels, the average emissions intensity for the FID class of 2024 is 13.6 kgCO2e/boe, well below the global upstream average of 21 kgCO2e/boe (including liquefaction emissions), according to Wood Mackenzie’s Emissions Benchmarking tool.

'New projects are a lever to meet emission reduction goals, especially those focused on deepwater projects that continue to deliver on low emissions intensity and economic returns,' said McGavin

Original article link

Source: Wood Mackenzie

Bookmark and Share

A global information service for upstream oil and gas opportunities - divestitures, farmins and farmouts and licensing rounds.

Subscriber Only Deals

Current Deals

Current Upstream Deals: 227

Completed Deals

Completed Upstream Deals: 6595

Company Profiles

Current Company Profiles: 2918

Corporate Activity

Current Corporate Activity articles: 4163

Companies Looking

Current number of articles: 466

Company Sales

Current Company Sales articles:1666


Current Geostudies articles: 985

How to subscribe

energy-pedia Jobs

RSS Feed Widget
See all jobs...

energy-pedia Databank

The energy-pedia databank contains links to information on the world financial and energy markets, including share prices, oil and gas prices and the global stock exchanges. Read more...

energy-pedia Glossary

A list of commonly used terms in the oil and gas industry. Read more...


Subscribe to the FREE
energy-pedia Daily Newsletter

Government of South Australia
Union Jack Oil 149
Telos NRG
Rose & Assocs
About energy-pedia

energy-pedia news is a FREE news service written and edited by E and P professionals for E and P professionals.

We don't just report the news, we give you the technical background as well, with additional information derived from our unique energy-pedia opportunities service.
Contact us

energy365 Ltd

238 High Street
London Colney
St Albans

Tel: +44(0)1727 822675