The Future of Energy and the Case of the Arctic Offshore: The Role of Strategic Management

Elias G. Carayannis,Alexey Cherepovitsyn,Alina Ilinova

doi:10.3390/jmse9020134

Elias G. Carayannis, Alexey Cherepovitsyn + Show 1 more

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https://doi.org/10.3390/jmse9020134

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Abstract

As risk and uncertainty factors have become more prominent in the already volatile energy market because of the COVID-19 pandemic, the development of Arctic hydrocarbon resources has become a debatable issue. At any rate, oil and gas companies need to improve their strategic management systems (along with the development of technologies) for the successful implementation of such complex projects. The purpose of this study was to propose the conceptual basis for transforming strategic management and planning systems of oil and gas companies so that they can successfully face global challenges when implementing offshore oil and gas projects in the Arctic as well as provide more sustainable energy sources. The article discusses the current situation with Arctic initiatives and the results of an analysis of price instability in the energy sector, along with an analysis of several megatrends affecting oil and gas companies. All this allows for presenting a conceptual vision of how a strategic management system should be transformed in order to become able to meet the requirements for implementing Arctic projects, with the emphasis being placed on sustainability, management requirements, and the key principles. The research is based on the fundamentals of strategic management and strategic planning and relies on methods such as desk study, content analysis, event analysis, comparative analysis, and factor analysis.

Highlights

Since 2008, when the U.S Geological Survey (USGS) completed an assessment of oil and gas resources in the Arctic, hydrocarbon deposits in this region have been attracting increasing attention
The research hypothesis is based on the assumption that oil and gas companies operating in the energy sector, which is highly turbulent and undergoing significant change due to a number of global megatrends, should improve their systems of strategic management and planning in order to reduce their dependence on global disturbances and be able to timely implement strategically important projects
What are the main directions for transforming strategic management and planning systems used in offshore oil and gas projects that are affected by global disturbances?

Summary

Introduction

Since 2008, when the U.S Geological Survey (USGS) completed an assessment of oil and gas resources in the Arctic, hydrocarbon deposits in this region have been attracting increasing attention. The Arctic potentially contains about 90 billion barrels of oil reserves, 50 trillion cubic meters of gas reserves, and 44 billion barrels of gas condensate, which constitutes approximately 16%, 30%, and 26% of the world’s undiscovered hydrocarbon resources, respectively [1]. Arctic offshore oil and gas reserves are concentrated in two seas (the Barents and Kara Seas) where a lot of geological exploration has been done in recent years [6,7]. Such a volume of proven reserves and a huge resource potential indisputably confirm that the Russian Arctic is and will be an area of significant interest and concern on a global scale

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