NOCs are struggling to gain access to capital in the current economic climate

Jon Clark of Ernst & Young spoke about the challenges that NOC’s are currently facing, and the strategies for accessing and increasing market share at the 2012 World National Oil Companies Congress. The current economic climate is making it harder for NOC’s to gain access to capital. Relationships with other companies can provide a healthy balance sheet, and further investment opportunities.  

There are many techniques IOC’s use to increase their international footprint.  i.e. Statoil’s acquisition of the Brigham Exploration Company or Petrona’s acquisition of a 50% stake in Canadian Shale Gas assets. Often asset swaps, and governmental agreements play a part.

It was emphasized that the preparation stage of an agreement is the deciding factor upon the destiny of the company. During the subsequent stages of a partnership the objectives may not always align. One has to also recognise that the local regimes are always different, across borders.

The choice of company alignment is also a big issue. It is important to find the right partner to obtain the best strategy, with long term objectives. The first international transaction may not be big, but it is important to have a good vision of your goal.

Jon Clark produced the following white paper to accompany the session.

Download the Ernst & Young white paper here

See also
EBN focused on future of gas prospects in the Netherlands