Managing Uncertainties for Exploration Success – Concepts, Challenges and Implementation

Abstract

Exploration uncertainties cannot be eliminated, but they can be managed. There is never sufficient information on source, migration, reservoir distribution, structural history, sealing, trapping, preservation and other factors that explorers would like to have to eliminate uncertainty and hence risk. Despite this, worldwide, exploration wells have been drilled for decades under imperfect information conditions. And as a global industry we have found plenty of hydrocarbons in the process. We have also drilled many more wells that did not deliver commercial success versus those that did. In our business, there is a great deal of confusion on the subject of Chance of Success predictions. This is true both at the level of the gesocientists as well as with management, boards and shareholders. It is important for everyone involved in our business to understand the basic underlying reasons for uncertainties in exploration outcomes and to know that geoscientists are actually working the best they can to actively take care of these uncertainties to bring about commercial results over time. The challenge is how the exploration campaign model is conceptualised, formulated and presented so that correct expectations of outcomes are set up from the very beginning of a campaign. If this is not done, unnecessary concerns can arise, when the inevitable nonsuccesses occur, and possible disruptive changes in exploration directions can take place which are counterproductive to the overall achievement of success. Exxon’s benchmarking study on the company’s exploration predictions and performance using 20+ years of drilling results presented in the AAPG Bulletin, v. 101, no.2 (February 2017) shows that the average Economic Success rate achieved over the 20 years involving around 550 wells, between 1995-2014 was 35%. Over the same period, the Geologic Success Rate achieved was about 50%. On average over 20 years, Exxon’s pre drill chance of success predictions versus the actual post drill results for both Economic Success and Geologic Success were quite close. The predictions versus actual outcomes varied over time but on average, there was a tendency to slightly under predict both Economic and Geologic success rates. A global study of 1,163 wells drilled between 2012 to 2017 by London based consultancy firm Westwood Global Energy Group shows that an average Economic Success outcome was achieved by 33% of the wells. Thus it can be seen that even with the best practices of a company with a long successful exploration history like Exxon and also from wells drilled by different companies worldwide, the drilling of non-economic wells is part of the process in achieving economic success. Based on Chance of Success modelling, it is shown how exploration expectation outcomes can be analysed before an exploration campaign. Graphical displays can show how specific chosen studies of charge, reservoir trapping etc. on each prospect can lead to changes in the chance of success outlook of the overall campaign. This approach allows a ‘Line of Sight’ management of an exploration campaign from the very beginning so that everyone knows what aspect of source/reservoir/trap analysis, a work program is addressing and how it is going to impact the overall expectation of at least one success from the campaign. This mode of analysis also allows any company to determine whether there are sufficient funds to cover the cost of attaining at least one success in a campaign. In summary, most companies, especially the smaller ones work under constant financial constraints. The methods offered here will help such companies make decisions on which acreage/ wells they can afford to participate in to attain success. It also allows management to get a feel of what is at risk in any particular exploration campaign

AAPG Datapages/Search and Discovery Article #90354 © 2019 AAPG Asia Pacific Technical Symposium, The Art of Hydrocarbon Prediction: Managing Uncertainties, Bogor, (Greater Jakarta), Indonesia, August 7-8, 2019