Connect with us

Oil & Energy

Upstream Spending Will Rise To $485bn In 2023

Published

4 years ago

on

Over the past three years, the majority of U.S. energy companies have avoided spending big to expand production in the aftermath of the 2020 oil crisis, prioritising returning more cash to shareholders in the form of dividends and share buybacks.
Most oil and gas companies have only announced small increases in their capital spending for the current year, and also plan to grow production modestly.
But this does mean that these companies won’t try to capitalise on oil prices that remain at multi-year highs.
In its 2023 outlook, Energy Intelligence notes that global upstream capex will hit $485B in the current year, good for 12% Y/Y increase and a near 30% recovery from the 2020 trough.
The energy expert says that spending is unlikely to hit the $700 billion-plus level seen during the 2013-2014 peak in this decade, with most companies preferring to focus on the most advantaged “barrels’’ i.e. lower cost, lower carbon projects with faster timelines. NOCs, large independents and western majors are returning to advantaged offshore plays including the Guyana Basin, Brazil, Gulf of Mexico, North Sea and West Africa–the regions also expected to drive the lion’s share of non-OPEC growth.
A number of oil and gas majors have announced bigger-than-average capex hikes for 2023 and beyond. Last month, Chevron Corp. (NYSE: CVX) announced that FY 2023 capital spending budget will clock in at $17B, more than 25% from expected spending in 2022 and at the top end of its $15B-$17B medium-term range.
The company said that upstream capex includes more than $4B for Permian Basin development; ~$2B for other shale and tight assets and ~$2B to go into projects that lower carbon emissions or increase renewable fuels production capacity, more than double the 2022 budget.
Although Chevron’s spending for 2023 will be considerably higher than capital spending in the 2020-21 pandemic years, it’s still much lower than the $30B annual average of the 2012-19 period.
“Our capex budgets remain in line with prior guidance despite inflation,” Chairman and CEO Mike Wirth said.
Chevron’s peer ExxonMobil Corp. (NYSE: XOM) has not announced a drastic increase in spending, but has said that its capital spending for 2023 will be closer to the top end of its annual target of $20B-$25B, a level it expects to maintain through 2027.
Exxon says that more than 70% of its capital investments will be deployed in the U.S. Permian Basin, Guyana, Brazil and LNG projects across the globe.
These investments will help increase the company’s upstream production by 500K boe/day to 4.2M boe/day by 2027. Exxon also unveiled plans to boost spending on lower emission projects by 15% through 2027 to ~$17B through 2027.
Exxon also plans to expand its stock buyback plan to $50B through 2024, including $15B in 2022 So, where will all that money come from? Exxon expects to “double earnings and cash flow potential” by 2027 compared to 2019, and also expects to deliver ~$9B in structural cost savings by year-end 2023 from 2019 levels.
Meanwhile, Canada’s third-largest crude oil and natural gas producer Cenovus Energy (NYSE: CVE) has announced that it expects to spend C$4B-C$4.5B in FY 2023, higher than estimates of C$3.3B-C$3.7B for 2022, including ~C$2.8B of sustaining capital for maintaining base production and support operations.
Cenovus says it expects to direct C$1.2B-C$1.7B towards optimisation and growth, including construction of the West White Rose project in Atlantic Canada.
Cenovus has also guided for production of 800K-840K boe/day in the current year, an increase of more than 3% Y/Y, including oil sands production of 582K-642K boe/day and conventional output of 125K-140K boe/day.
Meanwhile, the company expects total downstream crude throughput to clock in at 610K-660K bbl/day, up nearly 28% Y/Y.
Back in June, Saudi Aramco revealed plans to keep raising capital expenditure until the mid-2020s as part of its strategy to grow oil production capacity to 12.3 million barrels per day by 2025 and to 13 million b/d by 2027.
To support production growth, Aramco plans to allocate capex by up to $50 billion, which will then increase from 2023 until 2025.
Brazil’s oil and gas supermajor Petróleo Brasileiro S.A. or Petrobras (NYSE: PBR) has announced that it will increase 2023-2027 investments by about 15% to $78 billion over the company’s 2022-2026 projected spending. Of the $78 billion planned for capex, 83% or $64 billion is earmarked for E&P activities while 67% of the E&P capex budget will go to pre-salt activities.
The company also plans to boost spending to reduce carbon emissions to ~6% of the total compared with 4% in the previous plan, and will see its  decarbonisation fund  more than double the current $248M.
Meanwhile, Brazilian mining giant Vale S.A.(NYSE: VALE) has announced plans to increase capex  to US$6bn in 2023 from US$5.5bn in 2022 while exploration expenses are expected to reach US$350mn in 2026 compared to $180 million for 2022.
Vale says it expects iron production to only increase slightly to 320 million tonnes in 2023 compared to 310 million tonnes in the current year, but expects production to exceed 360 million tonnes by 2030.
Meanwhile, copper production is expected to jump to 335K-370K tons in 2023 from – 260K tons this year while nickel production is expected to exceed 300K tonnes from ~180K tons in 2022.

By: Alex Kimani
Kimani Reports for Oilprice.com

Print Friendly, PDF & Email
Related Topics:
Continue Reading

Oil & Energy

Civil Society Demands Accountability over N60Billion AKS Oil Producing Communities

Published

6 days ago

on

August 10, 2026

By

A civil society organisation, the Centre for Human Rights and Accountability Network, (CHRAN) has demanded full disclosure of how over ?60bn allocated to oil-producing communities in Akwa Ibom State has been managed since the inauguration of the Host Community Development Trust in 2024.
The group also threatened to deploy legal measures against trustees who fail to account for projects and other interventions funded from the oil host community development allocations.
In a Statement signed by the Group State Director, Otuekong Franklin Isong, and Secretary, Research and Documentation, Comrade Etimbuk Ekpenyong, the organisation’s demand was prompted by complaints from residents who questioned the level of development in their communities despite the substantial funds accruing to the trust.
According to the statement, Its demand also followed a verification exercise conducted by it’s investigation Team into the activities of the EMOIMEE Host Community Development Trust, which covers seven oil and gas-producing local government areas in the state.
The affected councils in the statement are Eket, Mbo, Onna, Ikot Abasi, Mkpat Enin, Esit Eket and Eastern Obolo.
The statement said, during the CHRAN verification exercise, only the Eastern Obolo Board of Trustees had so far provided satisfactory responses to its requests for information made under the Freedom of Information Act.
The organisation said the failure of other trustees to disclose information had heightened concerns over the transparency and accountability in the management of funds intended for communities affected by oil exploration and production.
The group said it formally wrote to trustees representing Eastern Obolo, Esit Eket, Ikot Abasi, Onna and Mbo on May 25, 2026, requesting details of projects executed, locations, contractors, scholarships and beneficiaries, as well as other interventions financed by the trust.
According to CHRAN, the Eastern Obolo trustees, Rt. Hon. Uduyork J. Aboh and Mrs Lily Evans John, responded with documents detailing 29 projects executed in the local government area and scholarships awarded to 2,000 beneficiaries.
The organisation said it independently fact-checked the information supplied by the Eastern Obolo trustees and found it accurate.
CHRAN commended the trustees for responding to its request, describing the disclosure as an example of the transparency expected from institutions managing public-interest funds.
The organisation, however, said four other trustees had yet to respond to its requests.
Those named were Hon. E. Justus Ntuk of Ikot Abasi, Hon. Bassey Dan-Abia Jnr of Esit Eket, Engr. Clinton Akpan of Onna and Dr Asuquo Edet Inuikim of Mbo.
CHRAN urged the trustees to immediately disclose details of how the funds allocated to their respective host communities had been utilised.
It said failure to provide the requested information would leave it with no option but to pursue available legal avenues to compel disclosure.
On Legal battle over Eket fund, the Human Right Group said its accountability campaign had already resulted in legal action involving the Eket representative.
According to the group, it was earlier written separately to the trustees representing Mkpat Enin and Eket.
While the Mkpat Enin representative responded, CHRAN said the Eket trustee failed to provide the requested information.
The organisation said this led it to institute Suit No. FHC/CS/10/2026, which is currently pending before the Federal High Court.
The Group stressed that its demand was not aimed at witch-hunting the trustees but at ensuring that communities receive the benefits intended under the Petroleum Industry Act.
The group said the EMOIMEE trust was established in pursuant to the Petroleum Industry Act, 2021, with Mobil Producing Nigeria limited as the settler and the Nigerian Upstream Regulatory Commission as regulator.
It said the trust was incorporated under the Companies and Allied Matters Act on July 5, 2023, and formally inaugurated on July 18, 2024.
The organisation alleged that the trust had received over ?60bn from the NNPC/MPN Joint Venture since inception, making transparency in the utilisation of the funds particularly important.
CHRAN said the funds were intended to address developmental challenges in communities hosting oil and gas operations and to improve the quality of life of residents.
It therefore urged all trustees to make their records available for public scrutiny.
“Public accountability is not optional for a statutory trust managing funds meant for the collective benefit of host communities; it is a legal and moral obligation,” the organisation said.
The Human Rights Group further warned that it would explore all lawful measures available to compel trustees who refuse to provide the requested information to disclose how the funds had been spent.
The Group called on residents of the affected communities to remain vigilant and demand accountability for projects, scholarships and other interventions funded from the host community development allocations.
The organisation said the response from Eastern Obolo demonstrated that transparency was possible and should become the standard across all the host communities.
Enoch Epelle
Print Friendly, PDF & Email
Continue Reading

Oil & Energy

NCDMB, BOI Unveil $100m Nigerian Content Equity Fund  …Set To Invest $5m In Oil Firms

Published

6 days ago

on

August 10, 2026

By

The Nigerian Content Development and Monitoring Board (NCDMB), and the Bank of Industry (BOI), Friday in Lagos inaugurated the Investment Committee of the Nigerian Content Equity Fund (NCEF).
The NCEF according to the Directorate of Corporate Communications of the Board is a groundbreaking $100 million financing product designed to avail long-term financing to service companies and provide access to funds in exchange for equity rather than the traditional debt instruments.
In his remarks at the inauguration ceremony of the Committee, Executive Secretary of the NCDMB, Engr. Felix Omatsola-Ogbe tasked the investment committee to carry out rigorous due diligence on every company seeking support and ensure that the objectives for which the Fund was established are fully achieved.
He said the Equity Fund must never be mistaken for a grant, stressing that beneficiaries are expected to deploy the capital judiciously and repay in accordance with the terms of the investment.
He urged the committee to ensure that only credible people with viable businesses benefit from the scheme.
“Our top priority should be identifying people who will use the Fund properly and, most importantly, return our funds back to us so that we can continue the programme for other deserving beneficiaries,” he said.
A statement from the Board’s Corporate Communications Division said the NCEF was inaugurated as a new financing solution to the Nigerian oil and gas service sector, and is also expected to accelerate local content growth.
According to the Boards Division of Corporate Communications, the underlying goal of the NCEF is to reduce per-unit cost of oil and gas products and services locally, create an additional source of income for the Board and play a catalytic role in attracting other investors and lenders to financially viable organizations.
“By providing access to equity financing, the NCEF will enable service companies to expand and increase their market share, which will contribute to the growth of the Nigerian oil and gas industry.
 “The Fund size is $100million, while the obligor limit is $5million. The Fund is provided by the NCDMB, while the Bank of Industry serves as the Fund Manager.
“The target beneficiaries are oil field service companies, manufacturers connected to the oil and gas sector, fabrication yards, and connected sectors, with the primary goal being to promote economic growth, job creation, and wealth creation in Nigeria”, the NCDMB said.
The Board added that the impact of the Fund on oil and gas projects could potentially create an estimated 12,500 direct jobs and 7,000 indirect jobs, stating that the inauguration of the investment committee marks another milestone in the evolution of the Nicetizn Content Investment (NCI) Fund which is a flagship intervention established under section 104 of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act to bridge financing gaps confronting indigenous oil industry firms.
A Statement from the NCDMB’S Division of Corporate Communications further said that while the five NCI Fund products managed by the BOI and two products managed by the Nigerian Export-Import Bank (NEXIM) have provided debt financing to qualified service companies over the past decade, with loans lasting five years and interest rates of 8%, the Equity Fund has carved a new niche.
Meanwhile, Managing Director of the Bank of Industry, Dr. Olasupo Olusi has described the inauguration as a major milestone in the consummation of the NCI Equity Fund, noting that the initiative represents the next phase in the long-standing collaboration between BOI and the NCDMB.
According to him, the partnership, which has lasted for nearly a decade, began with the administration of the US$350 million Nigeria Content Intervention Fund, through which hundreds of indigenous oil and gas companies have accessed financing to expand their operations.
He noted that the introduction of an equity financing window addresses an important gap in the industry’s financing architecture.
“The next step, which I am very impressed with and very thankful to the NCDMB for thinking through with BOI, is the need to fill the finance gap with equity,” he said.
According to him, equity financing offers an entirely different class of financial instrument capable of supporting businesses that may not yet qualify for conventional debt facilities, expressing confidence that the initiative would attract additional investment into Nigeria’s oil and gas sector while strengthening indigenous participation.
Giving further insight into the fund, the Group Head, Equity Investments at the Bank of Industry, Mr. Chike Chukwuelu, explained that the Equity Fund addresses what industry experts describe as the “missing middle.”
According to him, many indigenous businesses struggle to secure senior debt because they lack the level of collateral demanded by commercial lenders, despite possessing viable businesses with strong growth prospects.
Chukwuelu said the equity structure would also enable the fund managers to maintain closer oversight of beneficiary companies, helping them strengthen governance, improve operations and evolve into sustainable businesses.
In his remarks, Senior Technical Adviser to the Executive Secretary, Engr. Austin Uzoka, observed that the Equity Fund represents an opportunity to accomplish what previous financing interventions could not fully achieve.
“The striking thing is that the fund is about doing things the other funds have not been able to accomplish.” He said
 The Tide gathered that the committee’s responsibilities are to provide strategic oversight for the Equity Fund, ensure prudent investment decisions and build a portfolio of companies capable of growing into major industry players.
Ariwera Ibibo-Howells, Yenagoa
Print Friendly, PDF & Email
Continue Reading

Oil & Energy

Investment ln Young Engineers Key To Ogoni’s Future -President

Published

6 days ago

on

August 10, 2026

By

President of the Khana, Gokana, Tai and Eleme (KAGOTE) Organisation and Chief Executive Officer of Giolee Global Resources Limited, Chief Lesi Maol, has described investment in the training and development of young engineers as critical to the future and sustainable development of Ogoniland.
 Maol said this   during the opening of a four-week Wellhead and Christmas Tree Maintenance Training Programme for selected young engineers from Ogoniland at the corporate headquarters of Giolee Global Resources Limited in Port Harcourt, recently.
He said the initiative was conceived as a strategic intervention to bridge the gap between academic knowledge and the practical competencies required in today’s highly competitive oil and gas industry, while equipping participants with internationally recognised technical skills.
According to him, the future of Ogoniland is inseparable from the development of its human capital, stressing that the region’s greatest resource is not the wealth beneath the ground but the talent, resilience and potential of its young people.
Maol explained that the training programme was designed to produce technically competent, safety-conscious and industry-ready professionals capable of competing effectively in Nigeria’s oil and gas sector as well as the global energy market.
He emphasised that the initiative was not merely aimed at awarding certificates but at developing disciplined professionals who would uphold the highest standards of technical excellence, integrity, safety and service in the discharge of their responsibilities.
The KAGOTE President urged the participants to approach the training with dedication, professionalism and a willingness to learn, expressing optimism that the knowledge acquired would contribute to the economic advancement and sustainable development of Ogoniland.
The programme, organised in partnership with Rick International Services Limited and RickWell Tech UK, features classroom instruction, practical demonstrations using oilfield equipment, competency-based assessments, Health, Safety and Environment (HSE) training, leadership development and project management.
In his remarks, Lead Executive Trainer of Rick International Services Limited, Chief Engr. Ramos Ihekona, described the programme as a valuable opportunity for aspiring engineers to acquire practical industry experience from seasoned professionals.
Ihekona encouraged the trainees to participate actively in every aspect of the programme, collaborate with one another and maximise the opportunity to develop competencies that would enhance their confidence and employability in the energy sector.
The organizers said the training was introduced to address the persistent disconnect between theoretical engineering education and the practical skills demanded by employers, adding that the curriculum covers wellhead operations, Christmas tree systems, mechanical maintenance, pressure control, engineering documentation, equipment inspection, field troubleshooting, HSE and project management.
Some of the participants drawn from Khana, Gokana, Tai and Eleme Local Government Areas commended Chief Maol for sponsoring the programme and ensuring a transparent selection process.
He however , likened the initiative to a life-changing opportunity that would prepare them for rewarding careers in the oil and gas industry while contributing to the development of Ogoniland.
King Onunwor
Print Friendly, PDF & Email
Continue Reading

Trending