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Analysis

Oil and gas MNCs favour North American subsidiaries

The world’s leading offshore oil and gas industry companies operate an average of 130.2 subsidiaries each. We reveal the global hotspots for these operations.


Offshore oil and gas industry operations and technologies multinationals are far less likely to establish subsidiaries in western Europe than the average multinational company (MNC), according to analysis of GlobalData’s exclusively compiled subsidiary database.

Investment Monitor’s MNC subsidiary database contains information for 2,188 of the world’s top companies by revenue. Of these MNCs, 79 are in the offshore oil and gas industry operations and technologies industry, representing 3.6% of the companies in our database.

These offshore oil and gas companies are less likely than average to establish subsidiaries in western Europe (26.9% versus 36.8%) and are more likely to establish them in North America (33.3% versus 27.8%).

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Overall, the 79 offshore oil and gas industry operations and technologies MNCs in our database operate 10,287 subsidiaries. This comes to an average of 130.2 subsidiaries per company, compared with an average of 99 for the entire database of 2,188 companies. It should be noted, however, that the number of subsidiaries is by no means evenly distributed within the sector. The most common number of subsidiaries for an MNC in the sector (the mode) is eight, while the median comes in at 65, indicating that the simple average is skewed heavily by the bigger parent companies.

Netherlands-based Royal Dutch Shell has the largest number of subsidiaries among the offshore oil and gas MNCs within our database with 1,003. This means it ranks in seventh place across our entire database when measured by the total number of subsidiaries.

shell-subsidiaries-fdi
Royal Dutch Shell has the largest number of subsidiaries among oil and gas MNCs in Investment Monitor’s database. (Photo by Robin Utrech/ANP/AFP via Getty Images)

Where has Royal Dutch Shell placed its subsidiaries?

Royal Dutch Shell’s subsidiaries are distributed across the world, with 49.3% of the total located in western Europe, the highest for any region. Some 202 of Royal Dutch Shell’s subsidiaries are located in the UK, while the Netherlands is the second most popular destination with 174.

After Royal Dutch Shell, Total had the second-largest number of subsidiaries with 837, while BP is third with 664 and National Oilwell Varco fourth with 393.

Overall, 4,864 of the subsidiaries owned by the offshore oil and gas MNCs in the database are located in the same country as the parent company’s headquarters. This means that MNCs in the sector are more likely than average to have a preference for domestic subsidiaries at 47.3%, with the figure for the entire database standing at 45.7%.

Methodology

GlobalData has compiled a list of top MNCs based on revenue. Any top companies that did not have a subsidiary were removed from the list. The latest company annual reports (2019 and 2020, where available) and websites were analysed for a total of 2,188 companies.

For a subsidiary to be included, the parent company had to have a majority ownership/control in the subsidiary. Affiliates, associates, joint operations and joint ventures were included as long as the ownership criteria was met. Subsidiary information was captured at a country level. Country names were standardised. In total, 216,898 subsidiaries were captured.

This article originally appeared in Offshore Technology.

Patrick Scott is head of data journalism at GlobalData Media.

Georges is a data visualisation developer on GlobalData Media's data journalism team.