018 stands already as the best year for global oil and gas exploration since 2015. Guyana, Russia and the United States top the list with major discoveries.
Discovered resources have already surpassed 8.8 billion barrels of oil equivalent (boe) for 2018. Rystad Energy expects the number to grow to 9.4 billion boe by year-end.
“We at Rystad expect this discovery trend to continue into 2019 with many promising high-impact wells targeting vast potential,” says Palzor Shenga, senior analyst on Rystad Energy’s Upstream team.
Offshore discoveries represent around 82% of total volumes. 2018 has also seen a significant uptick in the reserve replacement ratio to around 15% from 11% in 2017.
“Global exploration activity and discoveries have halted their year-after-year decline and look set to rise in the next year. This as an exciting recovery which runs contrary to a decline in global exploration spending from 2014 to 2017,” Shenga adds.
Guyana, Russia and the United States top the discovery countries ranking.
Exploration spending decreased by nearly 61% from 2014 to 2018. Exploration investments halted their fall in 2018 and are expected to rise in 2019.
“This not only proves that E&P companies are once again willing to invest in exploration, but also highlights their idea of ’smart investments’ to de-risk expenditures as much as possible,” Shenga adds.
The decrease in overall exploration costs combined with an improved success ratio have led to tremendous improvement in the discovery cost per boe.
Senior Analyst, Upstream
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About Rystad Energy
Rystad Energy is an independent energy research and business intelligence company providing data, tools, analytics and consultancy services to the global energy industry. Our products and services cover energy fundamentals and the global and regional upstream, oilfield services and renewable energy industries, tailored to analysts, managers and executives alike. Rystad Energy’s headquarters are located in Oslo, Norway. Further presence has been established in London, New York, Houston, Stavanger, Moscow, Rio de Janeiro, Singapore, Bangalore, Tokyo, Sydney and Dubai.