The Internationalization of Energy firms

A literature review

Bachelor Thesis , 2011 , 43 Pages , Grade: 1

Economics - International Economic Relations

The process of globalization, the constant search for economies of scale and the more efficient allocation of scarce resources are some of the commonly identified drivers of internationalization. The opening of more and more economies worldwide to foreign capital
and international trade leads us to the question if any economy could still exist as an autarkic market without sacrificing prosperity.
Expanding into foreign markets does not simply mean for a firm to benefit from growth opportunities, it also implies accepting the challenge to compete with firms in a completely diverse country.

As regards the specific case of Energy firms, we have to consider that these kinds of industries differ significantly from other sectors of the economy. Taking this into consideration, it is crucial for us to analyze the differing corporate strategies of these firms in order to figure out the decisive underlying values, processes and aims. Despite the fact that the choice of the suitable entry mode is one of the most frequent empirically analyzed topics in International Business, it is often not possible to follow exactly
a theoretical Internationalization theory. Firms rather combine different approaches in order to figure out an individual strategy – most suitable for the corporation.

This thesis will analyze how Energy companies find out this perfect approach, which criteria they take into account, how these criteria are ranked according to the individual importance and in general,
what motives exist for expanding abroad. Furthermore, the author will analyze the development of energy firms in the past as well as
current and future trends by drawing comparisons with other companies in the extractive industry.

Table of Contents

Table of figures

Abbreviations

1 Background / Introduction
1.1 Academic relevance - Research Gap
1.2 Objective of the thesis
1.3 Structure of the thesis

2 Development of the energy sector in the past
2.1 Early activities, early organization. Energy firms start to internationalize
2.2 Energy market liberalization
2.2.1 Benefits of and barriers to the liberalization of the market
2.2.2 Consequences for European energy companies as well as for global big-players
2.3 Managing governmental energy policy - the role of the state in the energy sector

3 The global, liberalized energy industry of today

4 Identification of current trends in the energy sector
4.1 The wave of M&A and strategic alliances
4.2 The evolution of “National Champions”

5 Analysis of the expansion strategy of global players in the energy sector
5.1 British Petroleum
5.2 Royal Dutch Shell plc
5.3 Gazprom
5.4 To what extent do companies follow theoretic Internationalization Theories?

6 The energy industry as one part of the extractive industry
6.1 Extractive Industries - Definition and Characteristics
6.1.1 The obsolescing bargain in the extractive industry
6.1.2 Foreign-Investor host-country bargaining
6.2 Motives for Internationalization in extractive Industries
6.3 The global mining industry with regard to the Expansion Strategy of the MNC BHP Billiton
6.3.1 Definition
6.3.2 Structure of the global mining industry
6.3.3 Business Strategies in the global mining industry
6.3.4 FDI in the global mining industry
6.3.5 BHP Billiton - The Internationalization Strategy of a Small-country firm
6.3.6 The Internationalization Model - A suitable underlying theoretical framework for

Expansion Strategies in the mining Industry?

Conclusion

Sources

• College: Vienna University of Economics and Business (Institute for International Business)
• Grade: 1
• Author: Martina Geistberger (Author)
• Publication Year: 2011
• Pages: 43
• Catalog Number: V186865
• ISBN (eBook): 9783656101833
• ISBN (Book): 9783656101345
• Language: English
• Tags: internationalization, energy