Notwithstanding the recent drastic reversal of oil prices,
upstream oil and gas projects remain on the radar of many
international oil companies (IOCs) and national oil companies
(NOCs) that continue to look for good investment opportunities.
However, any upstream investment opportunity warrants careful
examination, not least because it will have emerged against the
backdrop of a financial tsunami.
More state control or less?
History shows that every period that witnesses a drastic
change of oil prices, in either direction, will be followed by
a redefinition of the landscape of the oil and gas sector.
Some predict that the bargaining power of host states will
be enhanced amidst low oil prices and economic downturn, and
the host state-IOC collaboration will go beyond the mere
sharing of production. This is illustrated by the recent
proposal of the Indonesian government to allow Shell to
participate in the Natuna D-Alpha project, conditional upon