Audit and consultancy firm, Deloitte, yesterday stated that oil and gas exploration and production firms globally could generate combined cash flows of a record $1.4 trillion this year, thanks to high prices in the ongoing readjustment in the energy markets.
For Nigeria, however, the oil rally appears to be a curse as a result of production challenges linked to crude theft and vandalisation, as well as an expensive subsidy regime. The consultancy estimates that the industry will see its highest ever-free cash flow of US$1.4 trillion in 2022 if Brent Crude price averages $106 per barrel.
Moreover, the U.S. shale industry could potentially become debt-free by early 2024 if prices stay strong and discipline prevails. Shale producers, which generated negative cash flows in nine out of the last 10 years, will likely see record-high free cash flows in 2021-2022 that could overcome the decade-long loss of $300 billion, according to Deloitte.