Oil companies will this year increase their investments in offshore drilling for the first time after five years of spending cuts as optimism for this segment of the industry returns and the spotlight shifts away from shale. Bloomberg quotes industry executives attending the Scotia Howard Weil Energy Conference in Louisiana this week as saying the recovery in offshore drilling was already underway and not somewhere in the future. A big part of the reason is that offshore drilling in some parts of the world is now cheaper than drilling in the Permian. Hess Corp’s chief executive John Hess must have raised some shale-loving eyebrows at the conference when he compared the production costs of the Permian and its own Liza project offshore Guyana. To pump the equivalent of 120,000 bpd, Hess said, you’d need to spend US$12.8 billion in the Permian versus US$3.7 billion in Guyana. While this stark […]