Special CEO Feature
On The Spot – The Analyst “What are the three most exciting prospects for the E&P industry in 2012?”
The E&P industry in 2011 has seen some remarkable events on the exploration side. The massive resource increase to a 1.7 – 3.3bnb recoverable range at Norway’s Aldous Major South / Avaldsnes discovery (on “4th generation” acreage) proves that seemingly mature areas can throw up truly world class results, and provide company changing events for those involved (principally Lundin Petroleum).
At the same time, high risk, frontier play-opening “swings of the bat” have proved successful such as Tullow’s Zaedyus discovery offshore French Guiana and then we have the East African gas success offshore Mozambique started by Anadarko being taken to a new level by ENI’s estimate of 22Tcf in place from one well into the Mamba South Area.
Clearly the E&P industry has the belief, determination and skills to keep unlocking the geology placed before it but after the successes of 2011, what can possibly be more exciting in 2012?
1. Prove the concept, build on the discovery, extend the play. The old adage that where you find oil there will be more nearby will lead to follow up drilling, both appraisal and exploration, in the areas we have mentioned above.
The initial discovery is not the end of the story so look for more news to come from these three areas.
2. Choose a “Swing the bat” play. Rockhopper’s success with Sea lion in the North Falklands basin could be over shadowed as the East Falkland Basin is drilled, first by Borders and Southern (2 prospects with ~2bnb prospective resources) and then by Falklands Oil & Gas (a further 2 wells with multi-billion barrel prospective resource estimates).
Expect interest to build as the Leiv Eiriksson drilling rig starts to move down from Greenland during December (60 day transit time).
3. Gulf of Mexico getting back to work. We think 2012 will also see further loosening of the restrictions against Gulf of Mexico drilling, offshore USA, this is incredibly important to the E&P industry as frankly the deepwater expertise the Gulf of Mexico provides to the world is significant.
This may go against a common perception following the Macondo incident but the irony of that event is that had it happened anywhere else in the world a lack of resources to tackle the problem could have amplified or extended the situation….and....we can't help mentioning....
4. Keep at it! Prove the doubters wrong. Exploration also requires perseverance, so we also highlight that less successful drilling (or flow-testing) during 2011 in frontier basins such as Greenland by Cairn Energy and the on- going Shale gas evaluation in Poland may not have provided the instant success that some would look for, but in all cases the data acquired has improved knowledge, reduced uncertainty, calibrated models and will certainly help with further work in 2012.
… Mrk Wils a on, Ana s, Maqua lyt c rie Ba k n
Drillers and Dealers :::
::: December 2011 Edition
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