As international oil and gas companies increasingly pursue hydrocarbons in frontier regions, the effect of investing billions of dollars into the developing countries where these energy resources are located has contributed to making places that were once regarded as backwaters, or even « Third World », very expensive places to live. While natives to a particular country can rely on local knowledge to keep their own living costs down, expatriates – especially with a taste for comforts from back home – are finding that certain African cities are among the most expensive places in the world to rent accommodation or even to buy a pair of jeans. Here we look at lists produced by consultancy firms ECA International and Mercer of the world’s most-expensive cities for expatriate workers to identify the most expensive oil and gas towns.
In ECA’s list of the top 50 most-expensive cities in the world for expats, five are located in Australia.
Undoubtedly, the strong Australian dollar (which has improved by around six cents compared to the U.S. dollar during the past six months) has played its part in making Australia a more costly destination for expats. But a lot of this strength has been driven by interest in a wide range of commodities available in Australia, not least of which is oil and gas.
The Western Australian oil town Perth came behind Canberra and Sydney in ECA’s list as the 27th most-expensive city for expats in the world. But for the purpose of this list, focused on the most-expensive oil and gas towns, we are rating it at number five. The boom in Western Australia’s energy sector has seen the state outstrip the rest of the country when it comes to job growth, as reflected by migration statistics that show Western Australia’s population growth increased by a whopping 3.4 percent in 2012 – compared to just 1.7 percent for Australia as a whole, according to the Australian Bureau of Statistics. Many of these migrants have flocked to Perth – the home of Australian oil and gas firm Woodside Petroleum Ltd., which owns extensive gas reserves in the Browse Basin offshore Western Australia.
Plenty of other firms have established bases in the city as they develop major gas projects, such as Chevron Corp.’s $45-billion Gorgon gas development or Royal Dutch Shell plc’s floating liquefied natural gas (FLNG) Prelude project.