Executive Oil Conference 2005

1
Executive Oil Conference2005
2
New Paradigm or Boom?

• Exploration Challenges in a Dynamic Environment

3
Dynamic Components

• Reserve Targets
• Risk
• Commodity Price
• Costs

4
Dilbert
5
Dilbert
6
Dilbert
7
Reserves and Risk

• Reserves are finite
• Reserves are distributed lognormally
• Exploratory targets are becoming increasingly
  smaller

8
Lognormal EUR Distribution
9
Lognormal EUR Distribution
10
Questions to Ask

• What are the remaining economic opportunities?
• What is the appropriate technology to apply?

?
11
Risked Profit

• Risked Profit (Prospect NPV) Ps minus (Risk
  Capital) Pf

12
Risked Profit27.00 BBL, 4.00 MCF, Ps 80
13
Risked Profit35.00 BBL, 5.00 MCF, Ps 80
14
Risked Profit42.50 BBL, 6.00 MCF, Ps 80
15
Risked Profit42.50 BBL, 6.00 MCF, Ps 60
16
Risked Profit27.00 BBL, 4.00 MCF, 25 Ps
17
Risked Profit35.00 BBL, 5.00 MCF, 25 Ps
18
Risked Profit42.50 BBL, 6.00 MCF, 25 Ps
19
Risk Profit and Ps
20
Exploration Challenges

• Reserves
• Risk
• Commodity Prices
• Costs

21
A Proverb

• There is desirable treasure, and oil in the
  dwelling of the wise, But a foolish man squanders
  it.
• Proverbs 2120