with smaller finds added 1 billion boe to the country’s recoverable reserves. Zama was the first discovery in Mexico
by a private company—Talos Energy—in 80 years (OGJ Online, July 12, 2017).
ExxonMobil Corp. added another 1 billion boe through
its Guyana discoveries: Payara, Turbot, and Snoek (OGJ Online, July 25, 2017). The operator announced on Jan. 5 that
its Ranger-1 well encountered 230 ft of high-quality, oil-bearing reservoir, marking a sixth discovery on Guyana’s
Starbroek block. No potential resources were announced,
but ExxonMobil unit Esso plans additional drilling in the
region through this year (OGJ Online, Jan. 5, 2018).
Despite these notable successes, Passos said low discovered volumes globally “represent a serious threat to the supply levels some 10 years down the road.” Since 2014, exploration expenditures have fallen more than 60%, Passos said.
A turnaround is necessary to avoid a future supply deficit.
Several high-impact wells were being drilled at the time
of its report, but Rystad did not expect the final 2017 discovery volume to increase dramatically.
Kosmos Energy’s ultradeepwater Lamantin well on Block
C- 12 offshore Mauritania was reported in mid-December
2017 as a dry hole despite an early estimate of large prospective resources.
Erin Energy Corp. was drilling its Oyo North West (
Oyo-NW) well, which the company spudded on Dec. 6, 2017, on
its oil mining lease 120 block offshore Nigeria (OGJ Online,
Dec. 7, 2017). The company estimated a 60-day drilling window and results will most likely be announced at the beginning of 2018.
The most recent predrill estimate indicates a resource of
more than 1 billion boe, which Rystad said would be a very
positive start for 2018.
Draft leasing program
offers 90% of OCS
The US Department of the Interior issued a draft proposed
2019-24 US Outer Continental Shelf oil and gas leasing program which would make more than 90% of the nation’s
federal offshore acreage available and schedule the largest
number of lease sales there in history. The current 2017-22
program enacted late in the Obama administration put 94%
of the OCS off-limits to oil and gas activity, DOI officials
“Today’s announcement lays out the options that are on
the table and starts a lengthy and robust public comment pe-
riod,” US Interior Sec. Ryan Zinke said on Jan. 4 as the draft
FERC rejected DOE’s initial grid resiliency approach, which
NGSA felt would have undermined competitive power mar-
kets and hurt consumers without bolstering reliability.
“We firmly believe that natural gas is a reliability asset in
the power sector, as proven repeatedly by its excellent performance during Hurricanes Harvey and Irma and during
last week’s extreme cold weather event that set records for
gas demand in the markets,” she said.
Susan Ginsberg, the Independent Petroleum Association
of America’s vice-president of oil and gas regulatory affairs,
said the national organization of upstream independents
found FERC’s reasoning and resulting order to be sound,
and in keeping with the documentation submitted by a diverse group of interested parties.
“Even the organized markets stated there is no grid reliability emergency,” Ginsberg said. “FERC took the reasonable, conservative approach to initiate a new proceeding to
further evaluate the resilience of certain bulk power systems.”
Rystad says discovered
resources at all-time low
Exploration added a record-low 7 billion boe in 2017, not
seen since the 1940s, said Mlada Passos, senior analyst at
Rystad concluded in late December that not only did the
2017 total volume of discovered resources decrease, but the
resources per field also declined. In 2017, average offshore
discoveries held 100 MMboe compared with 150 MMboe
in 2012. Discovered volumes averaged about 550 MMboe/
month, and the reserves replacement ratio reached only 11%
for oil and gas combined. Rystad said 2006 was the last year
the reserve replacement ratio reached 100%, largely owing
to the giant onshore Galkynsh gas field in Turkmenistan.
“Low resources per discovered field can influence its
commerciality,” Passos said. Rystad’s report estimates that
more than 1 billion boe discovered resources in 2017 may
never be developed under the current base-case price scenario.
Senegal, Mexico, and Guyana stood out in terms of 2017’s
discovered volumes. Kosmos Energy had continued success
with its Yakaar gas field in Senegal coupled with the Teranga
discovery in 2016 (OGJ Online, May 9, 2016). The discoveries could lead to future LNG development.
In Mexico, the Zama and Ixachi discoveries combined