by Elaine Reynolds
Since the oil
price crash of 2014, exploration has been particularly badly hit as companies
looked to trim expenditure. Wood Mackenzie estimates that 2017 exploration will
account for 8% of upstream expenditure, down from historic norms of 14%. In
this more difficult environment, any surviving exploration has tended to be led
by majors, for example ExxonMobil's giant Liza discovery offshore Guyana in
2015. In our most recent Exploration Watch, we highlight wells due to
spud in 2017 that involve independent companies, with resources estimates
greater than 100mmboe. Our exception is the much anticipated multi-billion
barrel potential Korpfjell prospect in the Barents Sea offshore Norway, which
is operated by Statoil and partnered by major companies.
Concentrated across underexplored basins
The majority of the seven wells that we have chosen to
highlight here are located in underexplored basins where success either nearby
or in an analogous basin has focused attention on the region. These wells
include the Araku prospect offshore
Suriname and to the east of Liza, and the Druid/Drombeg
well in the Porcupine Basin, which is an area attracting interest following
success in the analogous Flemish Pass Basin. Similarly, the Ayame well offshore Côte d’Ivoire is
looking to replicate the success in Jubilee, 600km to the east. Other wells are
in areas only recently opened up for exploration. Korpfjell sits in the Barents Sea but in a licence close to the
Russian maritime border that was offered for the first time in the Norwegian 23rd
round in 2016, while the Zama
prospect offshore Mexico was awarded in 2015 after the country opened up its
upstream sector to private investment for the first time in 75 years. However,
two of the wells are located in the mature UK North Sea, where both Partridge and Verbier are targeting over 100mmbbls in a region where the average
discovery size is 20mmbbls.
To read the full report click here , or to see a short discussion on our Bitesize briefing, click here