A quick look at some over-the-top field discoveries during the 21st century reveals that “show time” for the petroleum industry is far from over.
AAPG member Bob Fryklund, vice president Houston-based IHS, notes innovative play concepts and technologies have rewarded explorers with game-changing discoveries from 2000 through 2007.
The hydrocarbon finds during this period yielded 121,371 MMbo plus 751.5 Tcf of gas.
In other words, those who have decried a perceived dearth of discoveries may not have been paying enough attention.
In fact, for the past couple of years, the plethora of domestic shale gas play discoveries have became gangbuster headline-grabbing events.
“One of the questions we get asked the most is what happened to gas,” Fryklund said. “In North America, we went from a struggle to stay even to an oversupply.
“The big driver was the shales, the unconventionals,” he said. “Those were the things that weren’t on anybody’s radar screen.”
Shale potential is not confined to the much-heralded domestic plays.
“Shale is the number one source rock in the world,” Fryklund noted. “Where are these critters hiding internationally is what everyone is looking at – and also coalbed methane, which has some better potential internationally.
“Australia is one of the leaders, followed by Indonesia and then South Africa and central Europe,” he said. “They all have strong coal reserves to tap into, with coalbed methane leading the way.
“Shales internationally tend to be deeper, so it may take more thinking about how to get somewhere there at least on the gas side,” Fryklund said. “They’re not quite the lower-hanging fruit that coalbed methane is.”
As the industry folks explore for the next game-changing discoveries, both the Arctic and the offshore Mediterranean deserve a close look, according to Fryklund.
He noted the Mediterranean, which has been opened up somewhat via Noble’s discovery wells in the deepwater offshore Israel, could be a giant new province.
If Iraq puts out a big welcome mat for interested companies, the potential for additional major discoveries is huge. From an exploration standpoint, there will be more giants there, Fryklund said, noting that big tender offers currently are in the works.
The search for new super-size hydrocarbon deposits may be a global effort with plenty of room to roam, but don’t count North America out.
“In North America, the money is going into the commodity with the nearer term better price outlook, which is oil,” Fryklund said. “So the companies are changing their portfolio mix to focus more on oil.
“The deepwater is at the top of the list for the big guys and the medium size folks,” he said, “and the costs are coming down for the deepwater.”
Even though the big attention-grabbing story onshore North America has been about gas, this effort is struggling at the moment with low prices and an overabundance of product.
“If you look internationally, things tend not to slow as much because it’s a different business,” Fryklund said. “Instead of rigs being down 50 percent like in North America, they’re down more in the 10 percent range.”
Meanwhile, there’s excitement about discoveries made in 2008.
“If the Brazil subsalt and a few more of the other new discoveries prove up to be the size of the numbers we have now,” Fryklund said, “it would signal for the first time since Kashagan another little uptick in overall giants in discoveries.
“The big question is that much of the money that gets killed when we have a market downturn is the exploration money,” he noted.
“I don’t think we’ll run out of places to look, but we may be taking a pause in our activity.”
The paper “Game-Changing Discoveries Highlight 21st Century Exploration” by Pete Stark and Bob Fryklund will be presented at 1:20 p.m. on Wednesday, June 10, at the AAPG Annual Convention and Exhibition in Denver.
The paper is the first in the technical session of the same name, chaired by Stark and Fryklund.
Other papers in the session will cover the pasts, presents and futures of: