As big oil projects become more complex and riskier, US and European oil companies are entering into deals for gas projects in Australia and America. In America, new shale-gas reserves have triggered a string of asset acquisitions. In contrast to oil, gas development costs have fallen and Western companies’ expertise and capital are in demand by national oil companies in the Middle East and Russia. Also, long-term gas contracts for liquid natural gas, for example, provide more stable pricing. Government policies related to climate changes and growing demand for new power stations also favor gas projects. However, gas projects’ reliance on infrastructure could change the business model for oil companies to resemble one of a utility company.

Source: The Economist