Oil and gas companies are struggling to attract investors as oil charges fluctuate and evolve the energy landscape. Moreover, the sector’s annual stock performance has lagged in the past few years. As a result, it has become a challenge to attract investors into the industry. Besides, who would want to invest in a sector that seems not to boom? However, to rejuvenate the investor confidence, Swedish oil companies continues to look for new ways to change their game. Lawsuits are some of the challenges facing petroleum industry in Sudan. A good example is the lundin petroleum sudan case. Below are some of the ways to attract investors and other Swedish oil company’s activities in Sudan.
Comprehensive Understanding of Revenue and Costs
Companies need to look into the real costs and revenue at the granular level for the companies to deliver competitive earnings despite the oil-price swings. Gaining a high-resolution vision for the company requires leveraging the existing data on the transaction, which can be enormous. Furthermore, you will need to determine if the assets and activities are dilute or accretive. Similarly, anything that will not generate net profit when the commodity prices are low, then the dividend is at risk. Also, it means that the area of business profitable in a low price cycle is effectively sponsoring those that are not contributing to earnings.
Improving Cost Management
Greater and finely-tuned cost management might happen when the company examines the profitability of all assets and activities. Cost management may take different shapes from managing assets, supporting high performing activities to divesting sub-performing ventures. According to research, oil and gas businesses are aware that there could be no room to enhance cost management. Moreover, the leaders do agree that cost management is essential in generating more free cash flow. Yet, very few will grade their companies as being strong in this area.
Partner in Tech Game
Technological advancements such as artificial intelligence, virtual and augmented reality, sensors, and drones have become popular tools to streamline operations. Besides, they help unlock free cash flow and pinpoint new cost-saving opportunities. Although the oil and gas industry is the vanguard of technological innovation, it has been slower to embrace. As per the research, the industry is at 37% as good in digital maturity. Therefore, partnering with IT companies could bring the solutions they need to stay focused on the business’s core wants.
To attract capital in the highly competitive market, Swedish oil companies have become more enticing to the investors, who have clear priorities. Hence, they have to adopt a new strategy that prioritizes reliable shareholder returns by having an effective capital deployment. Furthermore, they should have reliable operational performance workable in any oil price phase to attain continued profitability.