Change is challenging, and no one likes downturns. However, there can be no doubt that dramatic environmental perturbations liberate people, economies, and organizations from some of their bindings, and they are able to explore new opportunities, to transform themselves and create dynamic, responsive organizations that fully take advantage of new opportunities.
In other words, become entrepreneurial.
The entrepreneur is an expert in identifying and assessing opportunities. Here are some of the opportunities that can emerge in times of low oil prices. They can range from providing services, identifying properties, or acquiring entire companies.
Investment banking firms that specialize in oil and gas are currently making funds available. The IPAA Private Capital Conference which took place January 29 included a number of presentations by private capital providers. Many detailed the opportunities and criteria they use for providing capital.
Further, the recent AAPG Eagle Ford Geosciences Technology Workshop (March 9-11) included presentations by experts who detailed the opportunities in times of low oil prices enter old fields and use new technologies and techniques (such as re-fracing and restimulating) for optimizing reservoirs.
Marginal or Mature Wells
Some fields are ideal for small operators who possess economies of scale that accommodate smaller operations. They may also be able to be innovative and incorporate new technologies and techniques. Learning about new technologies and reviewing case studies can be extremely helpful.
Missed or Bypassed Pay
Stranded, overlooked, or bypassed pay can be the secret of an operator's economic success if it is possible to use new technologies to cost-effectively recover the hydrocarbons in a way that is not damaging to the environment.
Incremental Production
New technology can be used to increase production from a well or field by increasing the pressure, increasing conductivity, and reducing the tension that may keep hydrocarbons within pore spaces. To do this, geoscientists need to have basic understanding of physical sciences and math. They must also have specialized knowledge.
Production Optimization
Using new technologies and innovative approaches can result in improved production, increased efficiencies, lower operating costs, better environmental management, better water handling and disposal.
Production Acquisitions or Management Buy Out
Geologists and engineers can evaluate the quality of the reservoir, determine the value of the reserves, and make recommendations. There may be ways to be innovative in looking at the production data or geological information.
Shut in, Stranded Gas, or Abandoned Wells
If infrastructure already exists, the costs of going to a field and using new technologies to recover previously unrecoverable oil and gas could be fairly inexpensive. Further, it is good to do the initial work while the prices are low, because with any luck, the prices will be higher by the time the field comes online.
Recompletions and Workovers
By studying the production history and taking a look at new equipment and approaches, it could be possible to restore production.
Development Drilling
Geologists can identify step out or infill drilling. In each case, it could be possible to reprocess old information (petrophysics, well logs, seismic) to see where the opportunities are.
Facilities
While looking at the geology, it's also good to evaluate gathering systems, tanks, transportation or other facilities. It might be simply a case of getting rid of bottlenecks or installing new equipment in order to have a low-cost production.
Conclusion
The unstated but overriding consideration in all of these areas is leadership and teamwork. None of the opportunities are viable without contributions of experts in their specialized fields, ranging from geology and engineering to a knowledge of accounting and finance. Visionary leadership that transmits inspiration, cohesion, and excellent communication are underlying foundations.
A longer version of this article appeared in the West Texas Geological Society (WTGS) Bulletin, for March 2015. Many thanks to Mike Raines. To join the WTGS and to obtain access to the article, please visit http://www.wtgs.org/
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