While global E&P spending is expected to ratchet up by 7% next year – the fourth consecutive year of growth to a record-setting US $644 billion – North American capex will lag the international pace, according to Barclays 2013 Global E&P Spending Outlook.

“We continue to believe we are in the early stages of a multi-year, double-digit growth spending upcycle internationally, characterized by increased drilling in complex geologies on land, and exploration and development of traditional and emerging deepwater basins,” James West , Barclays oil services and drilling analyst, said summarizing the global picture.

But, he added, “After several years of high-speed growth in North American capex, spending growth in 2012 slowed and 2013 spending budgets are expected to be roughly flat with 2012 levels.”

The Barclays report, which was released Dec. 4, was conducted in November and is based on surveys of 322 oil and gas companies worldwide.

Pausing To Breathe

While North American spending rose 27% and 31%, respectively, in 2010 and 2011, it took a breather in 2012, leveling to 4%. Barclays estimates North American E&Ps will spend $185 billion in 2013, compared with $183 billion in 2012, West said.

In the US, Barclays anticipates $139.6 billion in E&P capex in 2013, compared with $138.7 billion in 2012, a tepid 0.7% growth. In Canada, $44.7 billion is projected in 2013, up 0.6% from $44.4 billion in 2012.

West credits the growth pause to lower natural gas prices, reduced West Texas Intermediate prices, weak natural gas liquids prices, differentials in Canadian basins, logistical challenges in emerging plays, and a desire to spend within cash flow.

Within this context, independent E&Ps are broadcasting that they will decrease budgets next year, he said, totaling about a 1% drop, being more dependent on cash flows that have softened with commodity prices.

But this spending decrease will be offset by majors and national oil companies (NOCs), which are less affected by cash flow constraints, and which now have a more dominant position in North America, drawn by the oil renaissance here.

“The major US, European, and Asian international oil companies (IOCs) and NOCs are helping drive growth in the US market and are increasing spending as a percentage of total US upstream capex as a result,” West said. “We estimate these global majors will constitute roughly 32% of total US spending in 2013, including offshore, up from 27% in 2007.”

He calculates