This paper examines the new field discoveries of the last two-three years versus the previous ten years. It reviews the evidence of a
decline in exploration performance.
While gross resource volumes discovered per year seem to be reducing, data for very recent finds is incomplete. This gives the
possibility that the picture for 2003 and 2004 will improve.
It is certainly the case that discoveries are becoming harder to commercialize as there are fewer giant oil fields being discovered.
Furthermore, discoveries often feature relatively low value reserves from long lead time gas, heavier oil, deeper water, and harsher
fiscal terms.
On balance, deepwater remains the most important source of new field reserves and is the main driver of value creation for much of
the exploration industry. Success trends in these plays are a key indicator for future performance.
The overall effect is that the goal posts are moving for exploration companies. Many companies can no longer afford to view
traditional exploration in isolation. Increasingly, it forms part of a broader resource capture strategy.
We review all these key aspects of exploration during this presentation and draw some conclusions that will be important to those
companies interested in new discoveries and exploration performance.