Confidence in the outlook for the sector has almost quadrupled since 2017, rising from 18 per cent to 71 per cent in the past two years, according to a resilience report released today by technical adviser DNV GL.
This resulted in two-thirds of senior oil and gas professionals in the UK forecasting increased spending over the coming year.
The majority of respondents (68 per cent) said that they plan to increase or maintain capital expenditure in 2019, more than double the figure recorded two years earlier, while 72 per cent believe that operating expenditure is also likely to rise or hold steady.
Cost efficiency was cited as a less pressing priority than in recent years, while skills shortages and an ageing workforce were the most commonly noted barriers to potential growth.
This has likely been a key driver in the need to recruit, which experts said is now back on the agenda following four years of staff reductions.
Almost half of UK respondents revealed that they expect to expand their workforce over the coming 12 months. This compares with just 10 per cent four years earlier.
Decarbonisation ranked as a high priority, as nearly two fifths aim to focus on actively adapting to a “less carbon-intensive energy mix” and one-third look to boost investment in renewable energy this year.
Business opportunities and competitive advantage topped the list of reasons to decarbonise, followed by social/political pressures and regulatory requirements.
Digitilisation led the sector’s research and development goals by a significant margin, with 60 per cent expecting to up spending in this area. Priorities include data sharing, integration and access.
Hari Vamadevan, regional manager, UK and West Africa, said: “The significant boost in expectations for spending are welcome signs of an industry that is, for the most part, prepared to close the chapter on a string of challenging years.
“However, this also brings new challenges for the sector in 2019, the hard-earned cost efficiencies developed over the downturn could be put to the test as we see early signs of cost inflation returning to the industry.”
The results from UK-based professionals reflected global optimism regarding spending and recruitment in the sector.
Meanwhile, economic development body Opportunity North East and Scottish Development International are set to launch an export knowledge exchange programme to help oil, gas and energy supply chain companies internationalise.
It aims to bring seasoned and aspiring exporters together to share experiences, insights and opportunities with the hope of increasing UK exports to the global market.