Facing the slow pace of renewable energy transition, the intensifying concerns over energy security, and the continuous profitability of oil and gas businesses, global oil giants are collectively ramping up exploration efforts and refocusing on traditional energy sectors.
European oil and gas companies had promised to cut fossil fuel production and increase low-carbon investments at the beginning of 2020. However, the progress of the energy transition has fallen far short of expectations. Coupled with the supply shortages exposed by the energy crisis, they have now significantly adjusted their strategies. Shell and BP (British Petroleum) led the turn. The former cut billions of dollars in renewable energy investments and planned to start multiple exploration wells in regions such as the Gulf of Mexico and Namibia in the next 6 to 12 months. Its CEO, Wael Sawan, bluntly stated that "cutting oil and gas production is dangerous and irresponsible." The latter increased its upstream oil and gas investment to $10 billion annually while axing over $5 billion in clean energy spending. Its goal is to reach a daily oil and gas production of 2.3 to 2.5 million barrels of oil equivalent by 2030, in sharp contrast to its previous production cut plan. This year, it has achieved 10 exploration discoveries, including a major offshore block in Brazil. U.S. oil and gas giants ExxonMobil and Chevron have never truly withdrawn from the oil and gas sector and are now further intensifying exploration. After acquiring Hess, Chevron obtained the rights to key blocks in Guyana and also plans to drill wells in frontier regions such as Suriname and Egypt by the end of the year to improve the declining reserve replacement rate.
ExxonMobil, while deeply involved in the Permian and Guyana, reached an exploration agreement with Libya and re-entered the Trinidad and Tobago market. TotalEnergies of France also enriched its resource reserves by obtaining exploration permits in the Gulf of Mexico, Malaysia and other places. Behind the industry trend, technology has become the key support. Each company uses new technologies such as seismic imaging and AI algorithms to improve exploration efficiency. BP achieved 10 discoveries within the year precisely by relying on these means. Experts from Wood Mackenzie pointed out that energy companies are not only replenishing existing reserves but also expanding new exploration areas.
Although global exploration investment has been sluggish for a long time, the giants are restarting resource searches with a long-term layout, relying on cutting-edge technologies. The importance of traditional energy in the global energy structure is still difficult to replace in the short term.