The Profitable Use of 3d Seismic in Hydrocarbon Discovery and Development
Scolman Exploration Services, Lakewood, CO
3D seismic has been successfully used to better identify undiscovered and under-developed hydrocarbon reserves than its 2D seismic predecessor; however, application of the technology without the application of fundamental business logic can lead to lessened or even negative profitability. By using tradition business analysis techniques such as product lifecycle understanding, niche exploitation, barrier-to-entry concepts, and an understanding of the product commoditization process, profitability from 3D seismic can be enhanced and strategic advantages developed and maintained.
3D seismic has found application all along the time line of hydrocarbon discovery, development drilling, and secondary and tertiary recovery programs. At each stage of field evaluation, 3D seismic methods, ranging from research ideas through commoditized technologies exist reflecting traditional product lifecycle analysis. As with any generic product, companies must first identify a potentially profitable niche to enter from, evaluate the niche in terms of their company’s risk tolerance, and understand the strength of barriers-to-entry necessary in order to both maximize the time to commoditization for the product and to identify the transition from product development to process improvement. In terms of value being defined as revenue divided by expenses, a company must identify when to switch from spending numerator focused research dollars in order to make the product Better, to making denominator focused efficiency improvements along the Faster Cheaper guidelines.
Examples of successful and unsuccessful projects, ranging from research to well established 3D seismic methods, will be used to highlight the business analysis methods available for evaluating potential 3D seismic projects.
AAPG Search and Discovery Article #90092©2009 AAPG Rocky Mountain Section, July 9-11, 2008, Denver, Colorado