On 4 May REP published its seventh annual ‘State of Exploration’ report, which benchmarks the performance of international conventional oil and gas exploration. The report has grown to become one of the definitive global standards in the E&P sector.
In a world awash with untapped oil reserves, new discoveries continue to be elusive. According to Richmond Energy Partners’ annual ‘The State of Exploration’ report, global exploration drilling in 2016 is forecast to be down 73% on 2014 with discovered oil volumes at a decade low.
Dr Keith Myers, Managing Director, commented:
“Industry has responded to the downturn by slashing exploration budgets by over 70% on average. Sustained oil prices above US$60/bbl are needed to stimulate exploration. The geology economic to explore at US$40/bbl is actually quite limited”.
The report is based on the analysis of more than 1100 exploration wells and covers a total of US$49 billion of exploration drilling spend since 2010.
Highlights from the report include:
Dr Keith Myers said:
“Industry has learned some hard lessons from the downturn – many companies over-committed to drilling wells in order to access acreage. Increased drilling did not lead to more success, and the risks of certain plays were systematically underestimated. Exploration strategy is being reset across the industry and there is a real opportunity to improve performance albeit from a lower activity level.
The transition from financial crisis management, to a growth crisis will be rapid, and those that can maintain investment and upgrade their portfolio through the cycle will be the ones to prosper”.
The report is available to purchase from Richmond Energy Partners firstname.lastname@example.org.
Read the article online at: https://www.oilfieldtechnology.com/exploration/25052016/why-oil-discoveries-are-in-decline/