Oil and gas exploration in Southeast Asia is in crisis, with potentially serious long-term consequences for the region as energy demand increases. Fortunately, there are international exploration companies with the belief, courage and funding to undertake new projects in spite of the relatively low global price for oil. Prudent governments everywhere can help by liberalizing the bidding rules for concessions and doing more to encourage international interest.
In Southeast Asia, just 37 exploration licenses were granted in 2014, the lowest number in a decade. Wood Mackenzie, the global energy consultancy, says the number will fall further this year. There are many reasons for this, not least the plunging oil price, down from around $110 last June to about $62.50 in mid-April. Price volatility makes energy companies all over the world nervous about the prospects for realizing sustainable profits from costly new exploration.
