* Expects total E&P spending of $723 billion in 2014
* E&P spending to rise more than 7 pct in North America
* Forecasts 6 pct rise in E&P spending outside North America
Dec 9 (Reuters) - Oil and gas companies will spend about$723 billion on exploration and production (E&P) in 2014, anincrease of 6.1 percent from 2013, Barclays Bank said in areport on Monday.
Major oil companies are slowing spending growth as they putmore emphasis on increasing returns to investors amid a wave ofshareholders activism in the industry, Barclays said.
Activist investors have pushed for shake-ups at a number ofmid-sized energy companies this year including Chesapeake EnergyCorp, Hess Corp and Transocean Ltd.
The Big Oil companies -- Exxon Mobil Corp, ChevronCorp, Royal Dutch Shell Plc and Total SA and BP Plc -- though not targeted by activistinvestors are also under pressure to boost returns.
BP has raised its dividend, cut back capital spending plans,and ramped up its asset sales target to $10 billion over thenext two years from between $4 billion and $6 billion. [ID:nL5N0IL30F]
Barclays forecast an increase of more than 7 percent in E&Pspending in North America in 2014, compared with a 2 percentincrease in 2013, based on a survey of more than 300 oil and gascompanies conducted last month.
Spending is set to increase in North America after two yearsof tepid growth, when weak prices in the United States madedrilling for natural gas uneconomical in many onshore fields.
E&P spending outside North America is likely to increase 6percent to a record $524 billion in 2014, a smaller increasethan the 10 percent rise this year, the bank said.
Limited growth by the oil majors and corruption probesdirected at Chinese companies are weighing on growthexpectations for international spending, but this will be partlyoffset by growth in the Middle East, Latin America and Russia,Barclays said.
The bank said while its initial expectation for 2014suggested a modest slowdown in global spending growth, the mixof spending was moving away from large infrastructure projectsto drilling, evaluation and completion activity.
The shift implied a revenue opportunity for diversified oilservice companies such as Schlumberger Ltd, HalliburtonCo and Baker Hughes Inc, the report said.
E&P companies are basing their spending budgets for the yearon oil prices of $98 per barrel for Brent and $89 perbarrel for West Texas Intermediate, and a benchmark U.S.natural gas price of $3.66 per British thermal unit, thebank said in its Global 2013 E&P Spending Update.
