Pritesh Patel

Pritesh Patel CERA Director

Capital costs have held firm in similar areas, said Pritesh Patel, director for the IHS CERA Capital Costs Analysis Forum.

"Offshore costs, lead by strong demand for rigs continue to challenge the market," Patel said.
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For information on the Capital Costs Analysis Forum for Upstream, contact Pritesh Patel at ppatel@cera.com

"In the first half of 2007, the rate of cost increases moderated slightly when compared with the increases of the previous year," said Pritesh Patel, lead researcher for the Capital Costs Analysis Forum for Upstream, an on-going research project of CERA.
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"Not all costs have increased, however," Patel said."Our basket of offshore rig day rates has declined four percent in the last six months.This is important as rig rates often lead swings in project costs."

Patel noted that "the UCCI is a global measure of costs.Some regions, such as the Canadian Gas Market, have seen significant reductions in activity and a decline in costs as a result of the decline in the price of natural gas.However, on a global basis, this has been more than offset by high activity in the Middle East, West Africa, Brazil and other regions."

Patel identified tight manufacturing capacity leading to longer lead times for the machining of large equipment such as pumps and compressors.
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For information on the Capital Costs Analysis Forum for Upstream, contact Pritesh Patel at ppatel@cera.com.

Pritesh Patel, Director, Capital Costs Analysis Forum

Pritesh Patel, CERA Associate Director, Capital Costs Analysis Forum

Pritesh Patel, CERA Associate Director, Capital Costs Analysis Forum

Interviewed by Pritesh Patel, CERA Director

"These [upstream] costs are a serious concern and a major challenge for oil and gas companies and are contributing to the delays and postponements of many projects," says Pritesh Patel, director for the Capital Costs Analysis Forum for Upstream, a CERA Industry Forum.