Who assumes The Financial Risk of a project ?.
Short Answer: The owner assumes the financial risk of its project.
The Reality: While most oil companies are enjoying record profits, many oil service companies are incurring heavy losses on projects.

An unhappy and unhealthy situation for everybody : The E&C industry is in turmoil, Nevertheless, finding and development costs are rising.

Why are F&D Costs rising ?
– More complex projects (deepwater, frontier areas)
– No new wave of major technological innovations (such as 3D seismic and horizontal drilling during the 90’s)
– Ever-increasing local content requirements by host countries
– Higher euro impacting contractors’ euro-based costs
– More recently, rising steel prices and freight costsWho assumes The Financial Risk of a project ?. Short Answer: The owner assumes the financial risk of its project. The Reality: While most oil companies are enjoying record profits, many oil service companies are incurring heavy losses on projects. An unhappy and unhealthy situation for everybody : The E&C industry is in turmoil, Nevertheless, finding and development costs are rising. Why are F&D Costs rising ? – More complex projects (deepwater, frontier areas) – No new wave of major technological innovations (such as 3D seismic and horizontal drilling during the 90’s) – Ever-increasing local content requirements by host countries – Higher euro impacting contractors’ euro-based costs – More recently, rising steel prices and freight costs.