Source: Getty Images
Rethinking Exploration By: Judy Feder, Technology Editor
A
bstract
Down but not out” is how Westwood
Global Energy Group described exploration drilling in an article based on its State of Exploration 2020 Report. The Baker Hughes rig count provides supporting details. On 12 May, the data showed 339 active rigs in the United States—the lowest level since the rig count was introduced in 1987. On 1 June, the US count plunged to 301 in its 12th week of losses. At the worst of the 2014– 2016 oil bust—the previous lowest point on record—404 rigs were operating. The worldwide rig count for May was 1,176, down 338 from the 1,514 counted in April and down 1,006 from the 2,182 counted in May 2019. And, Rystad predicted on 28 May that
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more than half of the world’s planned licensing rounds for 2020 are likely to be canceled. The consensus among industry experts is that exploration will be hit by some of the deepest cuts inflicted by the coronavirus pandemic, the biggest oil market crash in history, and the transition to a low-carbon energy future. The silver lining is that there is still a business case for exploration despite these difficult times. Julie Wilson, director of global exploration research for Wood Mackenzie, said in a recent virtual panel discussion that the role of exploration in replacing supply sources in current portfolios with “new and better” barrels of oil equivalent (BOE) will continue overe the next 20 years. But for explorers to prosper, those barrels will need to be low in cost and emissions.
