Oil and gas consultancy Rystad Energy estimates that oil sands and the Arctic continue to be the most expensive resources, with an average breakeven price of $75-80 per barrel of oil equivalent (boe). The attractiveness of these resources has declined over the past years, mainly as a result of the introduction of North American shale. The break-even price of NA shale is estimated at an average of $60-70/boe.
|Source: Rystad Energy. Click to enlarge.|
Offshore is still in the race with lower break-even prices than US and Canadian shale developments (ultra-deepwater at $55-60/boe; deepwater at $50-55/boe and offshore shelf at $40-45/boe).
Though offshore projects have recently experienced a slowdown in investment levels, this decline is part of a natural cycle, and activity levels are expected to increase again. Both Deepwater and Ultradeepwater are necessary to develop in order to meet our demand outlook of around 100 million boe/d in 2020.—Espen Erlingsen, Senior Analyst at Rystad Energy
Rystad Energy’s demand outlook is just above IEA’s demand outlook of 98 million boe/d in 2020.