KUALA LUMPUR, Malaysia, Oct. 1, 2013 /PRNewswire/ -- Southeast Asia is poised to become one of the global hot spots for upstream oil and gas (O&G) activities over the next five years owing to the global surge in O&G exploration and production (E&P). Exploration, primarily in marginal and deepwater fields, is receiving a boost due to declining production in existing fields, unexplored acreages with high hydrocarbon potential, and advancements in deepwater production technology. Based on current reserve discoveries and each Southeast Asian country's O&G development program, new analysis from Frost & Sullivan ( http://www.energy.frost.com), Strategic Analysis of the Upstream Oil and Gas Market in Southeast Asia, finds that the market earned revenues of US$38.75 billion in 2012 and estimates this to reach US$58.32 billion in 2017 at a compound annual growth rate of 8.5 percent. "Technological enhancements, increasing gas demand, and rising oil prices have made marginal fields attractive for development, propelling the growth of drilling rigs and pipeline installations in Southeast Asia," said Frost & Sullivan Energy and Environmental Research Analyst Pradi Wigianto. "Declining O&G production in conventional shallow water fields has also encouraged investments in the exploration of deepwater and marginal fields." Malaysia and Indonesia present the highest potential for deepwater and marginal fields' development. Marginal fields, in particular, will drive the upstream O&G market in Malaysia as related investment policies have already been deployed. In Indonesia, the government has released additional incentive schemes and tax holidays to attract investments for E&P in deepwater and marginal fields. The lack of government initiatives in many other Southeast Asian nations may, however, dissuade investors from entering the region's market. Investment opportunities in E&P are fraught with high risks as potential fields are found in remote areas, heightening production costs due to their location and lack of infrastructure. Nevertheless, opportunities exist for O&G equipment suppliers and service companies to provide investors with the latest equipment using breakthrough technology at a competitive cost.