The global well count of 91 in 2019 is up 36% on 2018 according to research by Westwood Global Energy.
The global well count of 91 in 2019 is up 36% on 2018 according to research by Westwood Global Energy. Drilling spend was flat at $3.5 billion, however, as average well costs fell. Discovered commercial volume was the highest since 2015 at around 13 billion barrels of oil equivalent (boe) from the 27 high impact discoveries announced so far. The commercial success rate was at a 10-year high of 32%. This level of activity looks likely to be sustained through 2020, said Westwood.
Some 77% of total estimated 13 billion boe discovered was gas. The two biggest oil discoveries were both in the Exxon-operated Stabroek licence in Guyana.
North West Europe topped the charts for high impact drilling globally. ‘This was extraordinary given the maturity of the plays in the UK and Norway,’ said Westwood. ‘Unfortunately, and some would say predictably, only two high impact discoveries resulted from the 27 well programme – Glengorm in the UK and Liatårnet in Norway – a success rate of only 7%. Two wells are still drilling and could yet deliver discoveries, but the low discovery rate should cause pause for thought and the high impact well count should drop in 2020.’
Guyana topped the oil discovery charts again in 2019 with the Liza field coming onstream in December. The five commercial discoveries in 2019 bring the total so far to 14. The industry will continue to try to push the boundaries of the play beyond the Stabroek licence into both shallower and deeper Guyanese waters, said Westwood. The significant Maka Central discovery operated by Apache and announced in January 2020 looks to be the first commercial discovery outside of Stabroek, extending the play into neighbouring Suriname.
In Mexico, the five high-impact exploration wells completed by international oil companies in 2019 failed to deliver a commercial discovery (with one still drilling). ‘In 2020 it should become clearer whether Mexico will deliver the bounty that IOCs hoped for with at least 10 wells operated by seven different IOCs testing over 2.5 billion barrels of unrisked prospective volume in a range of frontier and emerging plays. The geology is complex and mixed results can be expected,’ said Westwood.
In Brazil one high impact well is currently drilling and seven wells are planned for 2020 in recently awarded licences testing 6 billion barrels of unrisked volume in pre-salt plays in the Santos and Campos basins, and the Ceara Basin. The much anticipated Peroba well drilled in 2019 by BP, for which a $598 million signature bonus was paid in the 2017 bid round, is understood to have found high CO2 content gas and is considered non-commercial, said Westwood.
In Africa, 14 wells were completed in 2019 but commercial success rates were high at 57% with more than 3 billion boe discovered of which around 80% was gas. There were high impact discoveries in Senegal, Mauritania, Nigeria, Angola and Ghana. In 2020, a similar number of high impact wells are expected spread across 10 countries with potentially six frontier play tests in Guinea Bissau, Kenya, Namibia and Gabon.
In the emerging gas plays of the Eastern Mediterranean there were six wells drilled and two commercial discoveries delivering 5 tcf. Five wells testing 16 tcf of gas are planned in 2020 including Total’s Byblos-1 well offshore Lebanon.
Drilling in Australasia is set to pick up in 2020 after a quiet 2019. In 2020 high impact drilling is mainly about gas with wells planned in Australia, New Zealand, Papa New Guinea and Timor Leste testing more than 10 tcf of gas most of which are testing frontier plays. South East Asia was quiet in 2019 with just three high impact wells and two high impact discoveries in Indonesia and Malaysia discovering 5 tcf of gas.
Based on current plans it looks like high impact drilling could be at a similar level in 2020, but with a shift of focus to North and South America. Westwood estimated that industry drilling plans are weighted 70/30 oil to gas. The four most active companies in 2020 are expected to be Total, Equinor, Shell and Eni, each participating in 14 or more high impact wells.
