Conventional exploration performance has improved considerably in 2017, with commercial success rates above 50% and much lower finding costs than for the same period in 2016. Although drilling was down 20% in 1H compared to the same period in 2016, discovered volumes were nearly twice that in 2016 1H and overall finding costs halved to
Notable oil exploration successes so far in 2017 include Payara and Snoek in the offshore Suriname-Guyana Basin; Eridu in Block 10 onshore Iraq; and Horseshoe-1 in the Colville Basin, onshore Alaska North Slope. Notable gas discoveries include: Yakaar offshore Senegal; Muruk onshore PNG; Qattameya Shallow in offshore Egypt; and Macadamia in offshore Trinidad.
Overall, commercial success rates jumped to 53% in 1H 2017 from 30% in 1H 2016, reflecting the high-grading of drilling portfolios, and fewer higher risk frontier wells (down to only 5 in 1H 2017). It is likely that 2017 will see drilling and spend slightly down on 2016 overall, but there remains some uncertainty over plans.
Infrastructure-led exploration drilling in established plays increased to 75% of the total exploration drilling budget whilst spending on high impact exploration remained steady. There were only 5 frontier wells completed in 1H 2017, with no commercial discoveries and only one technical (gas) discovery at Gorgon-1, offshore Colombia. There are currently 4 frontier wells drilling with an additional 10 - 15 frontier wells expected to commence by the end of 2017.
Green shoots for exploration drilling are appearing, but overall activity remains subdued. The lower well count is translating into more success and lower finding costs, proving that the old exploration mantra of ‘quality through choice’ still holds.
Andrew Hughes, Head of Research, Global Exploration
email@example.com or +44 (0)20 3794 5371
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/11072017/westwood-insight-drilling-down-performance-up/