Falklands : LESS OIL AND GAS DISCOVERED WORLD-WIDE
Submitted by Falkland Islands News Network (Juanita Brock) 23.01.2004 (Article Archived on 06.02.2004)
A new report on oil exploration claims that there has been a decrease in the number of reserves discovered. It follows the revelation from Shell that reserves of Oil and Gas are 20% lower than it had earlier believed.
LESS OIL AND GAS DISCOVERED WORLD-WIDE
A Report for BBC World Service “World Business Report” 01/23/04
A new report on oil exploration claims that there has been a decrease in the number of reserves discovered. It follows the revelation from Shell that reserves of Oil and Gas are 20% lower than it had earlier believed. The new report, which is from a leading research group, Wood-McKenzie, discovered that both 2001 and 2002 were very bad years for the world’s top ten oil explorers – something which isn’t obvious from their company accounts. David Morrison (DM), the Chairman of Wood-McKenzie explained why we would be in for more shocks like Shell’s.
DM: If you think about what happened to Shell, one of the fields they had to un-book, as it were, was a field called “Gorgan,” a gas field off North Australia. They found it in the 1970s but they still hadn’t quite got gas contracts in place and until do, it’s not commercial and they can’t book it. The way we look at reserves is we look at reserves when the wells are actually drilled, rather than when the reserves are booked. And the picture we are seeing is the reserves actually found last year and the year before and so forth, rather than reserves being booked. So, the industry, if you like, is living on a bit of fat from days of previous discoveries, particularly in terms of gas. You can’t develop gas until you have found a market.
Interviewer: It simply is not true to say it’s becoming harder and harder to find oil.
DM: The treadmill goes ever faster – the little hamster has got to run faster and faster. So, particularly for the big companies, it’s an enormous challenge. The volume of reserves needed to be found simply to stand still means that you need to find one Angola every year.
Interviewer: And, certainly in the last two years, you discovered they didn’t manage to keep pace with the rate of exploration they would need.
DM: The last couple of years have been bad. 2003, on our early estimates looks a little bit better than 2002 but still not enough to replace reserves being produced.
(100X Transcription Service)
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