Wood Group looking east with a strong oil and gas market outlook
In their year end result presentation, John Wood Group PLC, a market leader in engineering design, production support and industrial gas turbine services for customers in the oil & gas and power generation industries around the world, comment on the market outlook.
We expect continuing growth in demand for energy, primarily driven by the world’s developing economies. Oil & gas operators remain focused on developing their reserves – through new discoveries, often in deep water and harsh environments; through developing unconventional reserves, including heavy oil and shale sources; through achieving better routes to market for
previously stranded reserves, which is contributing to the growth in the Liquefied Natural Gas (“LNG”) market; and through maximising recovery from existing fields. Deepwater developments, subsea completions and
pipelines, and production enhancements are all significant growth areas in which Wood Group has strong market positions.
In the current global market we believe that oil prices will stay above $65, which is stronger than our prediction last year. There should also be continuing strong demand for gas, the most environmentally friendly fossil fuel, the price of which will become more global and increasingly influenced
by the oil price. Accordingly, we expect continuing robust exploration & production (“E&P”) spending programmes and are continuing our investment programme both organically and through acquisitions.
The fastest growth in our business over the next few years is likely to be seen in the eastern hemisphere. We have made further investments to develop our market position and capability in the region, and are focusing on developing
our relationships with national oil companies (“NOCs”).
Future growth will not be achieved without risks and challenges. The global oil & gas industry needs to develop reserves in harsher locations, and geopolitical uncertainty in some of the world’s key oil & gas provinces is a fact of life. We are focused on, and good at, tackling these challenges. We assess risk and reward and build in mitigating factors to, wherever possible, ensure we can keep our people safe, service our customers and, at the same time, achieve acceptable returns.
