Author: Saud Al-Fattah

Publisher:

Published: 2013

Total Pages: 0

ISBN-13:

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This paper provides an assessment and a review of the national oil companies' (NOCs) business models, challenges and opportunities, their strategies and emerging trends. The role of the national oil company continues to evolve as the global energy landscape changes to reflect variations in demand, discovery of new ultra-deep water oil deposits, and national and geopolitical developments. NOCs, traditionally viewed as the custodians of their country's natural resources, have generally owned and managed the complete national oil and gas supply chain from upstream to downstream activities. In recent years, NOCs have emerged not only as joint venture partners globally with the major oil companies, but increasingly as competitors to the International Oil Companies (IOCs). Many NOCs are now more active in mergers and acquisitions (M&A), thereby increasing the number of NOCs seeking international upstream and downstream acquisition and asset targets. Asian state-owned companies of NOCs, most prominently from China and India, are at the forefront of strategic cross-border investments as their governments seek to prepare for long-term energy supply challenges. At the same time, increasing oil wealth brought about by rising oil prices has encouraged governments as diverse as Russia, Venezuela, Bolivia, and Ecuador to give greater political and economic leverage to their national energy champions. This is achieved in their local market through revisions to constitutional laws, contracts, tax and royalty structures. Also, the NOCs have begun to enter the international market, engaging in strategic investment activities and acquiring full or partial control of foreign companies in sectors of strategic interest for national development. Within the GCC region, there are a number of national oil companies that have capabilities to expand beyond serving their domestic markets. This process is, in part, being hindered by the inadequacy of corporate structures and the lack of information in the GCC region. Globally, it is being hindered by the rise of economic nationalism and the debate around economic sovereignty, security, and ownership of assets, and the perception in the west that NOCs should not seek to acquire international oil companies and assets. Undoubtedly, political considerations influence and impact the international investment policy of NOCs. The emerging trend driven by the rise of NOCs has shifted the balance of control over most of the world's hydrocarbon resources. In the 1970s, the NOCs (super majors) controlled less than 10% of the world's hydrocarbon resources, while in 2012 they control more than 90%. This shift has enabled NOCs to increase their ability to access capital, human resources and technical services directly, and to build in-house competencies. Further, NOCs have been increasing their ability to conduct outsourcing activities for many operations through the oilfield services companies (OFSCs), thus increasing their range of competence.

Download or read book National Oil Companies written by Saud Al-Fattah and published by . This book was released on 2013 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper provides an assessment and a review of the national oil companies' (NOCs) business models, challenges and opportunities, their strategies and emerging trends. The role of the national oil company continues to evolve as the global energy landscape changes to reflect variations in demand, discovery of new ultra-deep water oil deposits, and national and geopolitical developments. NOCs, traditionally viewed as the custodians of their country's natural resources, have generally owned and managed the complete national oil and gas supply chain from upstream to downstream activities. In recent years, NOCs have emerged not only as joint venture partners globally with the major oil companies, but increasingly as competitors to the International Oil Companies (IOCs). Many NOCs are now more active in mergers and acquisitions (M&A), thereby increasing the number of NOCs seeking international upstream and downstream acquisition and asset targets. Asian state-owned companies of NOCs, most prominently from China and India, are at the forefront of strategic cross-border investments as their governments seek to prepare for long-term energy supply challenges. At the same time, increasing oil wealth brought about by rising oil prices has encouraged governments as diverse as Russia, Venezuela, Bolivia, and Ecuador to give greater political and economic leverage to their national energy champions. This is achieved in their local market through revisions to constitutional laws, contracts, tax and royalty structures. Also, the NOCs have begun to enter the international market, engaging in strategic investment activities and acquiring full or partial control of foreign companies in sectors of strategic interest for national development. Within the GCC region, there are a number of national oil companies that have capabilities to expand beyond serving their domestic markets. This process is, in part, being hindered by the inadequacy of corporate structures and the lack of information in the GCC region. Globally, it is being hindered by the rise of economic nationalism and the debate around economic sovereignty, security, and ownership of assets, and the perception in the west that NOCs should not seek to acquire international oil companies and assets. Undoubtedly, political considerations influence and impact the international investment policy of NOCs. The emerging trend driven by the rise of NOCs has shifted the balance of control over most of the world's hydrocarbon resources. In the 1970s, the NOCs (super majors) controlled less than 10% of the world's hydrocarbon resources, while in 2012 they control more than 90%. This shift has enabled NOCs to increase their ability to access capital, human resources and technical services directly, and to build in-house competencies. Further, NOCs have been increasing their ability to conduct outsourcing activities for many operations through the oilfield services companies (OFSCs), thus increasing their range of competence.