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World Economic Forum 2014

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The annual gathering of global leaders, from heads of state to chief executives of global companies, at Davos, Switzerland occurred last week. We look at the views and analysis of those involved in the energy industry.

Iranian President Hasan Rouhani, having been elected as president in June 2013, voiced his plans for the future. His first priority is a strategy to increase oil revenue once the economic embargo has been lifted. US oil majors such as Exxon Mobil were also allowed to attend his special session with oil and gas majors. Rouhani stated Iran will require assistance with management and technology in order to redevelop old oil and gas fields and enhance recovery from existing fields.

Total’s CEO, Christophe de Margerie stated his priority for the year is to deliver on projects. As head of Europe’s 3rd largest oil company he sees oil prices getting higher. He also expects any results from Iran to be developed by 2017 and contracts “will be more sexy than before” once the sanctions have been lifted.

Petrofac CEO Ayamn Asfari, who deals with oil and gas production and processing industries, has seen their share price tumble in 2013 on the back of profit warnings of oil majors. Geopolitical risks have also hindered projects such as in Libya, where all work had to stop for over a year. Growth in the US and emerging markets will assist their 2014 outlook, but there was a lack of growth in Europe coupled with cost pressures with the price of oil falling. He also expressed concerns with more being spent in the North Sea, only to produce less oil and gas. Capital expenditures by oil majors are dropping and an increase in disposal of assets is also likely to be a common theme this year.

ENI Chairman, Guiseppe Recchi highlighted the concern of the US shale gas impact in Europe where gas is three times more expensive than in the US. Samir Brikho CEO of Amec indicated that renewable energy will help close the gap but not bridge it. Both look forward to doing business with Iran, having previously done so.


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