Reservoir: Correct Forecasts Often Aren’t; Reservoir Study 2.0 = ?
After comparing forecasts of production, reserves, cost, schedule and value creation with the actuals realized, IPA (Independent Project Analysis) concluded that the state of the field development forecasting business is the equivalent of a yellow or red card in soccer. Something has to be done to make the forecasts more realistic and less biased towards the optimistic. At the same time, the E&P business is facing a VUCA future (volatile, uncertain, complex and ambiguous) and it is very important to account for the key uncertainties and risks in individual field developments and in the aggregate portfolio of company assets – as individual field and composite ambitions are arrived at and communicated. Add to this the need for E&P to adapt and to turn itself into a better performing E&P2.0 via imagination, innovation (of technology, big data, the internet of everything, AI, business model, collaboration2.0,..) and ‘creative destruction’ to combat low oil and gas prices, the high break-evens and the too low return on investment in the view of investors. All these aspects will be addressed and a key recommendation is that 2015 must be the year of cross-discipline thinking!
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