Lesson Overview
The Prospecting, Exploration and Evaluation module consists of seven lessons:
- Introduction to Prospecting, Exploration and Evaluation – What does this module cover?
- Exploration Fundamentals – How do exploration departments determine where to find new reserves, and obtain access or rights to them?
- The Search for Oil and Gas – How do explorationists select and then evaluate the first drilling location?
- Business Drivers – What are the key measures and drivers that impact exploration?
- Business Processes – What are key business processes used to manage global exploration activities?
- Industry Trends – What are the trends affecting the future success of exploration?
- Industry References – Where can I go for further information?
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Introduction to Exploration: Historical Perspective
Oil and gas is composed of compressed hydrocarbons. It was formed millions of years ago in a process that began when plant and animal remains were covered by very deep layers of sediment – minute particles of rock and minerals. With time, extreme pressure and high temperatures, these particles became a mix of both solid (coal) and liquid hydrocarbons. Even diamonds are a form of hydrocarbons.
Early oil discoveries were traced from natural hydrocarbon seeps at the surface. Many major fields of California, Oklahoma, Mexico, Iran, Iraq and Indonesia were related to surface hydrocarbon seeps:
- Colonel Drake’s first well was located near natural seeps on the banks of Oil Creek in Pennsylvania.
- One Royal Dutch Shell discovery came from natural oil ponds in Sumatra in 1880.
Hydrocarbon seepage also occurs in the marine environment:
- Rudesindo Cantarell, a Mexican fisherman, noted seeps leading to the giant field that bears his name.
- Deepwater Gulf of Mexico is a notoriously leaky system with more than a thousand hydrocarbon seeps.
Developments in the science of seismology, were instrumental in adding necessary tools and analytics to oil and gas exploration. In 1914 in Germany, the first seismograph was used to locate enemy artillery during World War I. In 1917 in the US, a similar apparatus was patented to locate ore bodies. The introduction of refraction technology to find salt domes in the US Gulf Coast began in the 1920’s.
The search for oil moved to deeper targets and use of reflected seismic waves became popular because it delineated other features apart from simple salt domes. Seismic advances during World War II helped the search for oil. Innovation has continued.
Advances in computing power since the 1980’s saw development of 3-D seismic surveys, leading to more accurate and realistic imaging of the subsurface. 3D technology increased the use of seismic data for oil and gas production, as well as exploration.
The final development that was important to exploration progress was conceptual. It is called the exploration basin-play concept, developed in Canada in 1972 and still used today. A play is a group of prospects for oil and/or gas, across a very wide geographic sedimentary basin with similar geologic origins, which indicate the potential for similar faults, traps which become drilling targets.
Read more about the difference between Upstream and Downstream.
Prior to the play concept, exploration risk analysis concentrated on a single prospect, often without technically considering it’s relationship to other similar prospects. Today, the play concept gives explorationists the ability to leverage successes and reduce risk across numerous wells, reservoirs and fields as they explore for new hydrocarbons, and enhance existing oil and gas accumulations.
The primary purpose of exploration is to discover new accumulations of hydrocarbons, called reserves. Today they are often located in remote areas, deep water and tens of thousands of feet below the surface.
Conventional oil and gas accumulations only occur under very precise geological conditions. These conditions require extensive technology and a very disciplined analysis approach to improve exploration success.
As shown in the chart, the process of exploring for oil and natural gas includes:
- Understanding and evaluating the geologic setting,
- Obtaining access to the potential reserves,
- Determining where to drill and completing a successful discovery well.
- Only then can additional hydrocarbon reserves be added to the portfolio of an oil company or E&P operator.
Exploration is very iterative. Every investment and well drilled permits more targeted exploration to be conducted. For example:
- Improved seismic tools and interpretation can indicate new potential drill sites.
- Data from a positive wildcat well helps extend and delineate the discovered reservoir.
- Every additional well and downhole measurement improves understanding of the field.
This module focuses on management of the technical and commercial activities used to find and develop new hydrocarbon reserves, often simply called Exploration. Each lesson in this module offers explanations of the three exploration processes, including the technical and commercial language, business drivers, decision processes and the future trends.
Related Resources:
What is the difference between Upstream and Downstream?
Drilling Wells for Oil and Gas and Offshore Drilling
I would like to thank you for a brilliant interactive 101 materials. I did use to prepare for the recruitment process is Royal Dutch Shell, and I managed to take a new role in a new oil and gas industry.:)