Uche Cecil Izuora
In spite of challenges due to COVID-19 and the accelerating energy transition, high impact oil and gas exploration drilling in 2021 maintained its momentum.
According to latest analysis from Westwood Global Energy Group, a specialist energy market research and consultancy firm, While high impact drilling levels in 2021 were similar to 2020, performance sank significantly, with discovered resource dropping 65 per cent in 2021 to 6.7 billion barrels of oil equivalent, bnboe.
The commercial success rate also fell 11 per cent year-on-year, from 40 per cent to 29 per cent.
This is due to a reduced number of giant discoveries >500mmboe and some unsuccessful play extension tests in recently opened emerging basins.
The research also confirms that companies with a significant proportion of infrastructure-led exploration in their portfolios delivered a higher commercial success rate and a more predictable finding cost, despite lower discovery sizes. Access to funding also meant that Supermajors and NOCs, together accounted for 68 per cent of high impact well equity in 2021 compared to 47 per cent in 2018.
Graeme Bagley, Head of Global Exploration and Appraisal at Westwood said, “The results of our latest State of Exploration report present a promising outlook for exploration, having bounced back from COVID-19 and despite significant headwinds against exploration for fossil fuels. As we stride towards a cleaner energy mix, however, the crucial requirement is for low emissions intensity developments for all future exploration opportunities.”
“Looking ahead, we’ll be seeing scrutiny of the success case impact on company net zero targets, with ESG considerations and the time to break-even becoming increasingly important when it comes to prospect selection.”
The State of Exploration 2022 report is now available for subscribers to Westwood’s Wildcat solution.
