Upstream-Petroleum Exploration

The role of exploration is to provide the information required to exploit the best opportunities presented in the choice of areas, and to manage research operations on the acquired blocks. An oil company may work for several years on a prospective area before an exploration well is studded and during this period the geological history of the area is studied and the likelihood of hydrocarbons being present quantified.

Exploration is responsible for handling the risk intrinsic in this activity, and this is generally achieved by selection of a range of options in probabilistic and economic terms. Indeed, exploration is a risk activity and the management of exploration assets and associated operations is a major task for oil companies. The risk cannot be eliminated entirely but can be controlled and reduced adopting appropriate workflow, conceptual and technological innovations. When it’s been decided to start up with an exploration project in a basin or in a larger area containing several basins, the quantity and quality of available data must be acquired and evaluated – geological data, type of reserves, production of existing fields etc., Basin assessment/evaluation is the first step to undertake the study of the area under interest. Technological development has provided oil companies with Basin Modelling – which is a numerical simulation that allows the temporal reconstruction of the history of a sedimentary basin and the associated evolution of the processes related to the formation of petroleum accumulations.

The sequence of activities covered by an exploration permit is fairly uniform, and include the creation of a database the analysis of available data the programming of mapping and geological and photo geological surveys seismic surveys and interpretation of seismic data the choice of well locations, drilling the analysis of results and the decision as to whether or not to proceed with the application for a lease or to release the area after fulfilling obligations Goal of exploration is to identify and locate a prospect, to quantify the volume of hydrocarbon which might be contained in the potential reservoirs and to evaluate the risk inherent the project itself. A prospect is a viable target evidenced by geological and geophysical indications that is recommended for drilling and exploration well.

The prospects identified must be technically practicable and meet the market conditions to guarantee a financial return on investments. The results obtained by drilling the exploratory wells indicate whether the initial geological hypotheses are correct or whether variations are found. All this will allow the fine-tuning of the economic analysis of the project possibly turning hypothetical reserves into proved ones. Where profitability does not meet the standards of the company, it leads to the termination of further investments.