Oil Industry's Spending To Rise In Hunt For Energy

The global oil industry, far from chastened by the catastrophic spill in the U.S. Gulf of Mexico, is planning record spending next year, including a large amount for deep-water development. From giants Saudi Aramco and Exxon Mobil Corp. to five-person wildcat outfits, the industry plans to spend nearly a half-trillion dollars next year to find and extract oil and natural gas, according to a new survey by investment bank Barclays Capital. For the first time in several years, large Western oil companies are leading the industry's charge, increasing their budgets faster than the state-run national oil companies that have dominated spending in recent years. "This is being driven by the appetite to find more oil, comfort that today's oil prices will be sustained and companies getting out of a hunker-down, recession mode," said James West, an energy analyst with Barclays, who co- authored the survey, which has been produced every year since 1982. Barclays estimates spending on new wells, producing platforms and other energy infrastructure will total $490 billion next year, up 11% from 2010. The figure is based on a survey of 402 companies. In part, the planned spending increases reflect the higher costs for finding and extracting oil in harder-to-access areas.