much information is enough when you're drilling
an exploration well?
The standard answer might be,
"A little bit more," or "You can never have too much information."
But the exploration expert would
say, "Just enough, and not a bit beyond that."
Marlan W. Downey became Shell's
youngest chief geologist, served as the company's first Alaska Division
exploration manager and later led worldwide exploration efforts
as president of Pecten International and also Arco International
Oil and Gas.
In his industry career, he sometimes
found an exploration team searching for information instead of searching
"That's when I tell staff, 'We're
not here to learn. We're here to make money finding oil,'" Downey
When Enough Is Enough
Ted Beaumont operates TriOks,
a one-man, independent prospect-generating company in Tulsa. A former
science director for AAPG, he's building a career on exploration
Beaumont not only has to find
the key to a play, he has to develop the information to support
it and convince someone to drill it.
"If you have a lot of information
that really confirms an idea, if they can see that, you can get
people to buy it," he said. "Even when times are tough, you can
get that done. Information is critical."
Knowing exactly what information
matters, and how much to gather, might seem to be more art than
science. But Downey said science has taken a hard look at the process
of compiling information.
"There's already a fair amount
of studies and mathematical analysis about the value of incremental
information," he observed.
Developing information costs
money. Any added increment of information costs more than the previous
increment, because the most accessible and least-expensive information
tends to be acquired first.
The cost of added information
can be weighed against its value in solving a problem. And should
Downey became a professor in
the University of Oklahoma's School of Geology and Geophysics, was
chief scientist at the university's Sarkeys Energy Center and has
served as AAPG president.
His work on the scientific method
in exploration led to an assessment of incremental information.
The value of adding information in exploration can be defined to
a limit, according to Downey.
"Very simply, that is when the
new information no longer changes in a significant way the picture
that you have," he said. "That's a nice, simple way of looking at
Both Eyes on the Prize
In practice, adding incremental
information makes sense only if it further defines a play in a meaningful
way. If new information makes no change in your analysis, you may
be at the information limit.
But if you acquire a seismic
line and the data reshapes your concept of a play, then you haven't
gathered enough information, Downey said.
Yeilding is technology unit leader for BP in Houston, and a current
Distinguished Lecturer for AAPG. She also had a key role in the
company's Thunder Horse discovery in the Gulf of Mexico.
Yeilding sees information as
part of a risk-reward picture. The cost of adding information can
be justified only if the information reduces risk in a meaningful
"There's always going to be uncertainty
-- you can't get around that," she said. "When evaluating a prospect,
we do a technical evaluation and assessment of all of the key geologic
"Combining the principles of
good old-fashioned geology and high technology using tools such
as seismic depth imaging, spectral decomposition and basin modeling
-- we assess the trap, charge/source, reservoir and seal potential
for the prospect."
Yeilding said all of these elements
"are risked, multiple models and uncertainties are investigated,
economics and potential value are assessed."
BP then ranks the prospect against
other opportunities within its portfolio, with the highest-value,
lowest-risk, most-strategic play receiving funding.
"We ask, 'Is the prize big enough?
Are the risks small enough to justify the prize?'
"The way we tend to look at it,"
Yeilding added, "you get to a point where you can't do any more
work that will lower the risk."
Knowing What Matters
As an independent, Beaumont tries
to hold costs to a minimum.
But he also needs to offer information
that will convince someone to spend the money to drill a well.
In that, he's not so different
from an exploration team "selling" its prospect to management for
"You try to be as efficient as
you can. You try not to waste money," Beaumont said.
"In some cases," he noted, "you
have people who will buy your prospect only if it has seismic data.
There are people who won't take a deal without 3-D data. There are
people who won't take a deal that doesn't have an offset well that's
To get the right information
without wasting money and time, Beaumont has to determine what matters
most in developing a new prospect.
"It really depends on where you're
looking," he said.
"If you're looking in a real
frontier area where there's not a lot of well control, obviously
you've got to have a certain amount of information that gives you
the impression that your effort might be successful -- outcrop data,
source rock, reservoir-quality rock, anticline, surface work and
He divides approaches to exploration
into three categories:
- Technique -- Using an exploration tool
or technique, like surface geochemistry, to identify promising
- Area -- Prospecting only in a limited,
familiar geographical area.
- Trap -- Specializing in plays built on
one type of trap, like reef plays or trend exploration.
With a world of possibilities,
almost all exploration begins by targeting a specific area. "Is
it in the right place? We say, 'Is it in the right zip code?' From
there, we start looking at what the best prospects are in the right
area," Yeilding said.
"We like to have a strong regional
understanding of our plays to help us focus in on the best geography/geology,"
she added. "Having a robust regional framework for a basin helps
us understand the potential, and allows us to rank different opportunities
around the world."
By working different plays and
geographies within a basin, BP can high grade the lowest-risk plays,
"This high-grading helps us focus
our resources and efforts into smaller geographic areas rather than
spread ourselves thinly across the entire basin," she said, "and
forces us to constantly high grade our exploration plays."
Beaumont said he begins by defining
an area to examine, then looks at individual formations.
"When I look at an area, I have
to try to understand what's happened in that area. I have to understand
what zones have produced and why they've produced," he said.
"You're breaking things down
into critical factors when you're looking at an area, and you're
trying to decide what's going to make a difference," Beaumont added.
"That's where experience comes
in. You learn what matters and what's important. You don't want
to get lost in the forest -- not seeing the forest because of all
the trees around."
Using the Global Brain
At BP, an exploration team can
call on experts from throughout the company to help assess and analyze
"We use a lot of peer review,
so we try to use the global brain," she said. "We will call on expertise
from other parts of the company before we determine if we have a
Outside viewpoints can bring
perspective to both the quantity and quality of information used
in building a prospect. BP brings in that outside expertise while
a prospect is being considered.
"Because we have the luxury of
a big global geoscience brain, we hold peer reviews at various stages
of prospect maturation and prior to approval for drilling," Yeilding
"This allows us to use constructive
challenge and draw upon our global experience to ensure that all
aspects of the prospect have been thoroughly evaluated and appropriately
An independent working alone
also can use the global brain, according to Beaumont.
"The Internet has made things
more available to individuals, if they want to take advantage of
it," he said.
As an example, he cited companies
that will let an independent access and analyze their seismic data
to generate prospects, as long as the company gets first right-of-refusal
on the prospects generated.
Beaumont called that a "win-win
situation," because the company can end up with an attractive play,
and the independent has a built-in investor for a good prospect.
Tapping the global brain requires
more creativity on the part of the independent, and a solid network
of expert colleagues.
"If you're an independent, you
never really work by yourself," he said. "Independents form a full
team for each prospect area we're working on or for each project.
"That team may go on to another
project or prospect, or it may dissolve and never come back together
Curiosity, and Satisfaction
In the end, the information-gathering
effort will always face the limiting constraints of time and money.
"Almost all of our work in the
Gulf of Mexico is on 3-D seismic data," Yeilding said. "In our deeper,
subsalt plays, balancing the cost of new seismic data and depth
imaging, the timing required to get the best subsurface image and
the timing of needing to drill a well is often a struggle.
"We constantly find ourselves
trying to balance the applications of the appropriate technologies
to obtain suitable results for drilling an exploration well in the
time required," she added.
For BP in the Gulf of Mexico,
seismic costs outstrip the money spent on applying individual expertise
and satisfying curiosity.
"The people time is not very
expensive, in the big scheme of things, because we're talking about
tens of millions of dollars per well," Yeilding said.
Downey knows the benefits and
pitfalls of scientific curiosity. It drives geoscientists to find
relevant information for an exploration prospect -- but satisfying
their curiosity is never the point.
"Exploration is not a science,"
Downey said. "It's a business. You don't get to know everything
about a stratigraphic prospect."
He's challenged geoscientists
to avoid "the tendency to merely go after information for information's
sake," asking them to asses how much information is necessary and
Downey pointed out that oil companies
are not in business to add to the body of scientific knowledge,
or to make geologists and geophysicists wiser.
"That's not why shareholders
give us money," he said.