Another Technological Revolution in the O&G Industry: A new Future for Onshore E&P. Ivan Sandrea Advisor to Petra Energia

Transcription

1 Another Technological Revolution in the O&G Industry: A new Future for Onshore E&P Ivan Sandrea Advisor to Petra Energia

2 Contents Another technological revolution in the O&G industry Key onshore stats The next phase of industry exploration

3 Source: Sandrea, OIES (2012) Another Technological Revolution in the O&G Industry

4 Annual reserves additions, mm boe Industry Access A transformational decade 160, , , ,000 80,000 60,000 40,000 20, bn Kashagan (Sub salt) 18 bn boe Canada Heavy Oil AB Yolotan (Sub salt) 25 bn boe Brazil (Pre salt) 50 bn boe Wheatstone Shoktman 20 bn boe US Shale 100 bn boe Iraq 80 bn Orinoco >30 bn New access Russia Arctic YTF 100 bn boe Angola (Pre salt) YTF 40 bn boe China Shale 200 bn boe India Uganda 2-3bn boe 2bn Ghana 2bn boe Source: Modified from Sandrea and Enfield, OIES (2012) Israel 4bn boe Venezuela 3 bn boe MZ - 18bn boe Vaca M >5bn Kenya 2bn TZ - >10bn boe

5 Cum. Discoveries, bn boe Cumulative Reserves Additions A transformational decade Offshore Arctic gas Arctic oil Offshore conventional gas Offshore conventional oil Onshore DW gas DW oil Onshore conventional gas Onshore conventional oil Shale Oil Shale Gas EHO Source: Industry presentations, analyst reports, DOE, AB, IEA, OPEC, IHS, Statoil, Sandrea (OIES)

6 Returning to Onshore Drivers, scale Drivers Price Technological developments Large resources Shifting risk profile Heavy oil >200 bn* Conventional plays >120 bn HPHT >20 bn Shale plays >100 bn Tight plays >50 bn Capex, $ pa >60 bn >100 bn >20 bn >80 bn >50 bn Source: Industry presentations, analyst reports, DOE, AB, IEA, OPEC, IHS, Statoil, Sandrea (OIES) *reserves (2P) added

7 Key Onshore Global E&P Stats Area Production/Total 19/31 million Km2 IP > 15 Tn boe Exploration Wells per Km2 of SB (Frontier) <10 per 100K km2 Remaining Reserves 2.4 Tn boe Untested basins / plays Many! Average Discovery Size 260 mmboe Source: WM, IHS, Industry, various databases; excludes USA; includes Middle East

8 Global Reserves Added vs YTP, YTF Important role for technology Reserves, bn boe Arctic gas Arctic oil Offshore conventional gas Offshore conventional oil 1000 DW gas Cum Disc. ( ) Offshore Onshore YTP, YTF Onshore DW oil Onshore conventional gas Onshore conventional oil Shale Oil Shale Gas EHO Source: Industry presentations, analyst reports, DOE, AB, IEA, OPEC, IHS, Statoil, Sandrea (OIES), EIG

9 Above Ground Risk Select countries onshore opportunity set LEGEND: 10-6 CRE Score (Least Risk vs. Reward) 6-2 CRE Score 2-(2) CRE Score (2)-(6) CRE Score (6)-(10) CRE Score (Most Risk vs. Reward) Source: EIG Country Risk Evolution (CRE) Risk/Reward Score*, 2013

10 Philippines Ukraine Ghana Egypt Uzbekistan Nigeria Congo Iraq Gabon Mexico Venezuela Tanzania Kuwait Uruguay Cambodia Sierra Leone Equatorial Guinea Mozambique South Sudan Myanmar Cote d'ivoire Bolivia Suriname Ecuador Cuba Libya Democratic Republic of Congo Yemen Guyana Senegal Uganda Kenya Liberia Syria Sudan Guinea Guinea-Bissau Sao Tome Lebanon Canada United States Canada-Oil Sands United Kingdom Australia US-Deepwater GOM Norway United States-Alaska Canada-Offshore Colombia Russia Qatar Poland Greenland Oman China United Arab Emirates Brazil Malaysia Romania Israel India Thailand Indonesia Kazakhstan Peru Trinidad Azerbaijan Argentina Brunei Iraq-Kurdistan Saudi Arabia Cameroon Vietnam Cyprus Turkey Iran Angola Algeria Turkmenistan Risks and Rewards Select countries onshore opportunity set Risks outweigh rewards Rewards outweigh risks Source: EIG, Research Onshore focus countries Risk Score/Reward Score CRE data as of January 15, 2013

11 Nigeria South Africa Libya Angola Algeria Kenya Cote d'ivoire Gabon Namibia Cameroon Congo Brazzaville Egypt Ghana Sierra Leone South Sudan Somalia Congo Kinshasa Guinea Bissau Morocco Sudan Chad Madagascar Mozambique Tanzania Liberia Tunisia Ethiopia Niger Equatorial Guinea Guinea Uganda Africa YTP, YTF Onshore vs Offshore Strong offshore activity But onshore activity rising, and large areas yet to be explored Missing data, other factors keeps many explorers away The non geologists see this as an opportunity Onshore Offshore Source: Sandrea, OIES (2012)

12 The Next Phase of Industry Exploration >5 tn boe onshore URR potential and not just unconventionals! Missing Data Source: DOE, various industry reports, Daly; Sandrea (2012)

13 The Next Phase of Industry Exploration Final Thoughts Large amount of reserves, YTP, YTF remaining onshore Move to less risky exploration activity is a new structural change; decades of activities ahead to understand the missing data New kind of risks, portfolio, skills set needed Industrial versus regional challenges and opportunities will determined pace of development Long term capital commitment is growing but not there yet Operational efficiencies, intensity of activity Resource long industry (thanks to onshore!) Increasing role of technology

14 New Technologies

15 Thank You

16 The Next Phase of Industry Exploration 1 tn boe offshore URR potential All offshore Unknown Artic Deepwater & UD Shallow Undiscovered / Reserve growth 300 -? Bb East Med, East Africa North Atlantic / North Africa Artic / China / Deep Mexico Top producing regions Deepwater Shallow Shallow Remaining Reserves Bb Produced 240 Bb Top producing regions + East Med, East Africa Source: Modified from Sandrea (2007); since 2007 over 100 bn boe have been discovered offshore

17 The Next Phase of Industry Exploration High impact offshore exploration plays Source: EIG, Morgan Stanley, Analysts reports, Company Data MS - Some 300 offshore wells to be drilled in 2013, testing 90 bn boe of reserves