AAPG Annual Convention and Exhibition

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Future of Energy Exploration

Abstract

Today things look bleak. Oil discoveries are at a 70 year low. Few companies are aggressively exploring for new resources, layoffs continue, some bankruptcies have occurred & commodity prices continue to be in the doldrums where companies spend more time cutting investments than growing or even restoring their resource base. Is this current snapshot of our industry a view into the future? I would say no. We have seen elements of the current downturn before. Many people point to the mid-1980's when increasing market share was the goal of one of the world's largest & lowest cost producers. A drop in oil price, layoffs, deferral of investment all followed. The same is true today & the situation cannot last. Supply & demand will come into balance. Governments & companies will need to renew new investment to maintain production and replace what has been produced. Recent climate agreements will not impact this, as any realistic future scenario clearly shows a large contribution of oil & gas to the energy mix well past 2040. The focus of this talk will be about key factors that impact investment and people. GDP growth, field decline, OPEC behavior and US oil production will all impact company & government actions on spending & encouraging exploration. We will need to see these factors behaving in a predictable manner to encourage companies and governments to promote and increase spending on exploration. A large part of the future of energy exploration is also centered around people. Specifically, the teams of explorers that dedicate their careers to the creative & innovative application of science to find new oil & gas globally, often in the face of adversity. The need to master new technology, to interrogate data for increasingly subtle plays, to deal with governmental requirements & to navigate internal company hurdles all pose challenges to the new generation of explorers. Explorers over many decades have risen above many challenges and continued to find new oil & gas deposits. Even at today's low point, we can still point to interesting & valuable discoveries being made. Not as much nor as many as we would like/need but the point is that the exploration spirit still thrives & will do so in the future. We will find more oil & gas to fuel the energy needs of the world. The discoveries we will make will at times surprise us. However, what will never surprise anyone is the hard work, dedication, intelligence & ingenuity exhibited by explorers all over the world.