As the oil and gas industry continues to weather the storm of the downturn, South America’s upstream sector is preparing for a wave of new growth and opportunity.
Across the globe, operators have slashed capex and reduced activity after the worst price crash in decades wreaked havoc on the sector. The current state of the market has put the U.S., Europe and Africa in a dire state, offsetting a potential 2021 recovery by two or more years.
Although the outlook for the sector remains uncertain, South America is expected to lead the recovery among regions given its attractive onshore and offshore prospects, the political resolve in Guyana and Argentina’s hydrocarbon production, according to Wood Mackenzie analysts.
In all, South America’s resilience during distressed times signals a positive recovery. The country’s progress could prove to be a useful blueprint for the strategies across the globe as E&P companies begin to emerge from the downturn.