Oil and gas industry overall contract value increased in 2022

The roller coaster ride during the COVID-19 pandemic appears to be coming to an end, with contract activity returning to normal for the global oil and gas industry, despite the ongoing Russia-Ukraine conflict and volatility in crude oil prices. As a result, the oil and gas industry witnessed a year-on-year increase of 3% in overall contract value in 2022, despite a 4% decrease in contract volume, reveals GlobalData, a leading data and analytics company.

GlobalData’s latest report, reveals that the overall contract value increased from $178.86 billion in 2021 to $183.63 billion in 2022, though contract volume saw a marginal decrease from 6,972 in 2021 to 6,668 in 2022.

Pritam Kad, Oil and Gas Analyst at GlobalData, comments: “Petrobras' three floating production storage and offloading (FPSO) contracts worth $8.75 billion to Keppel Shipyard (P-80 and P-83 FPSO) and Sembcorp Marine(P82 FPSO) for the Buzios field in the pre-salt Santos basin, Brazil, were the significant contributors to the overall contract value during the year." 

Operation and Maintenance (O&M) represented 50% of the total contracts in 2022, followed by contracts related to procurement accounting for 24%. Contracts involving multiple scopes, such as construction, design and engineering, installation, O&M, and procurement, accounted for around 13%.

The other major contracts include Dalian Petrochemical’s $4.67 billion contract from Ameer Group for the engineering, procurement, and construction (EPC) of the Pakistan State Oil deep conversion oil refinery in the Larkana Sindh province of Pakistan; and Saipem’s $4.5 billion contract from Qatargas for the engineering, procurement, fabrication, and installation of two natural gas compression facilities for the North Field Production Sustainability Offshore Compression Complex Project – EPC 2, offshore north-east coast of Qatar.

Abu Dhabi National Oil Company (ADNOC)’s three framework agreements worth AED14.68 billion ($4 billion) with ADNOC Drilling, Schlumberger, and Haliburton for the provision of integrated drilling fluids services (IDFS) in the UAE was also one of the significant contributors to the overall contract value in 2022. 

Kad concludes: “The oil and gas industry is likely to see some relief in the short term for now, but the environmental concerns and the recent advances towards sustainable green fuel, and energy transition projects will present some significant challenges to growth in the long run."