The National: "Despite record spending levels, soaring from US$20 billion in 2004 to more than $90bn last year, and the application of technologies undreamed of in the 1950s, the results have been disappointing. With the world consuming almost 34 billion barrels of oil each year, only between 6 billion and 7 billion barrels of oil were found annually from 2012 to last year, and only about 2 billion barrels so far this year, although that will be boosted by end-of-year reports.
This poor performance is not entirely the industry’s fault. There is little exploration in promising areas such as Iran, Iraq and Russia. Between 2006 and 2013, Brazil’s “pre-salt” area contributed mega-billion barrel discoveries, but political and contractual wrangles have slowed down new exploration. Most new discoveries are in deep-water areas, large but expensive to drill and develop. And many companies are replacing their crude reserves with shale oil rather than new conventional finds.
Some new frontiers prove that success is not impossible: the Kurdish region of Iraq, the extension of Brazil’s pre-salt to West Africa, the Falkland Islands, Kenya and Newfoundland have paid off."
This poor performance is not entirely the industry’s fault. There is little exploration in promising areas such as Iran, Iraq and Russia. Between 2006 and 2013, Brazil’s “pre-salt” area contributed mega-billion barrel discoveries, but political and contractual wrangles have slowed down new exploration. Most new discoveries are in deep-water areas, large but expensive to drill and develop. And many companies are replacing their crude reserves with shale oil rather than new conventional finds.
Some new frontiers prove that success is not impossible: the Kurdish region of Iraq, the extension of Brazil’s pre-salt to West Africa, the Falkland Islands, Kenya and Newfoundland have paid off."
