Offshore developments have experienced lower breakeven prices over the last 2 years with more than half of the cost reductions achieved through downsizing, simplification, and design, said Rystad Energy.
Engineers have reassessed their design approach to make project development and the budget process more predictable, said Rystad analysts.
Operators and service companies have worked together to lower costs. High-grading of rigs, vessels, equipment, and labor also yielded breakeven improvements as did the renegotiation of rig and maintenance contracts.
Audun Martinsen, Rystad vice-president of oil field research, said, “By focusing on the areas with the highest potential within their portfolios, exploration and production companies naturally gained the most from these newfound efficiencies by high-grading their undeveloped fields.”