“I took the most jagged path into the oil business, as you can imagine,” says Henry S. Pettingill. “There was nothing for me to identify myself with the oil industry, as I grew up in Virginia, and it took a job interview to realise the potential of what this industry had to offer.”
Henry can now look back at a rewarding career, during which he quickly established himself as an expert in deep-water exploration and risk and portfolio analysis, backed up by a rigorous understanding of the use of direct hydrocarbon indicators in prospect de-risking. A few years ago, this culminated in him taking on the lead of the well-known Rose DHI consortium, a position that exposes him to many of the exciting global exploration projects.
But he went scuba diving first.
“During my university years in upstate New York, I initially developed an interest in biology and ecology,” he says. “When the opportunity came along to spend a research semester on the Virgin Islands as part of a Marine Science program and do some scuba diving for university credits, I did not need to think long.”
One of the requirements of the program was to complete a few courses in geology. This introduced Henry to earth sciences for the first time. “It made me realise how much fun these guys were having,” he says.
“That’s when it all clicked for me. Once I was back at the university, I did everything I could to graduate with a geology degree, and scrambled to get onto as many courses as possible.”
It was quite the change – from studying coral reefs to investigating the impact of meteorites on mantle rocks. Petroleum geology was not on Henry’s radar yet. Not in the slightest.
“Upon completion of the undergraduate programme, I was invited to work with people from the USGS in Denver, Colorado to help research the Lutetium-Hafnium dating system. My bosses and mentor were in a race against CalTech to successfully develop and publish the technique. It was a great experience to be part of that team and share the thrill of wanting to be the first to publish a new methodology.”
It paved the way for Henry to spend a few years further studying isotope dating techniques in graduate school, whilst being a bit of a rabble-rouser and a hippie at the same time.
“But then comes that moment you ask yourself the question, what to do with the rest of your life?” he continues. And right at that time, in the early eighties, many oil companies were having a hiring spree.
“So I decided to use these companies to brush up on my interview techniques, not expecting to work there at all,” Henry says. “Until the moment I walked into the room and met Byrd Larberg, who I still see once a month. He lit me up with excitement, and after an on-site interview and weekend in New Orleans, which went equally well, I knew there was no way back.”
Henry went from dating kimberlites and anorthosites to studying the Pleistocene mud pile in the Gulf of Mexico for Shell.
Going global with Shell
“When I walked into the office in New Orleans on my first day with Shell in 1983, we were just weeks before the first-ever wide-open Federal lease sale – Sale 72 – across the GOM,” Henry continues. “You can imagine there was no time for formal training, just on-the-job learning, “drinking through a fire hose” as they said. But it was incredible – the people around me took pride in mentoring me, and I had new colleagues of my age joining the company all the time.”
The discovery of the Mars field was one of Henry’s highlights during his Shell years.
“It was a game changer in two ways,” Henry says. “Firstly, it was a geological novelty to drill into what was certainly a synclinal structure.” Why was it decided to lease and ultimately drill it anyway? “That’s because we saw that the DHI we had identified showed conformance with closure,” he explains, “even on 2D seismic, which was the only data we had at the time.”
I’m a guest in their country, so my first priority should be the people I work with, not the rocks I work on
But the discovery of Mars was a novelty in another way too. “I was told that Shell would not have drilled Mars at 100 %,” Henry explains. “The risks were considered too high.”
“It is thanks to Jim McClimans from Shell that we did, as he managed to get bp interested, which ultimately led to a deal.” As Shell did not carry all the risk, Mars was drilled, and rather than the expected two to three pay zones, the well proved thirteen. It was a real game-changer.
“So guess what happened at the next lease sale?”, Henry laughs, “everybody went bonkers and leased all blocks with synclines and amplitudes. We had leased the Mars and surrounding blocks for almost nothing, as nobody was interested in that play initially.”
Did it result in a lot more Mars-like discoveries, though? “I am not entirely up to speed with all subsequent exploration results,” Henry says, “but I believe that the Mars complex ended up a bit of a one-off exploration success. I know at Shell we drilled three “lookalikes” afterwards that came up dry.”
“Not long after drilling, we hypothesized that Mars worked due to the fact that below the reservoir there is a kitchen in the shape of a half-turtle anticline with a big fetch area that funneled all the oil into the Mars reservoirs. Basin modelling work supported this,” he says. “It gave me an everlasting confidence and respect for basin modelling work and I always think of my mentor Harry Doust saying that the Gulf of Mexico hydrocarbon systems are a complex of dynamic leakage.”
The international postings and travel Henry and his wife Rosario enjoyed with Shell made them aware that they wanted more of this. So when Shell canceled a posting to New Zealand for the couple to relocate back to New Orleans instead, they made the call to change direction. “I had some very marketable skills around that time, too,” he continues, “which played in my favour.”
But instead of joining another international major, Henry was recruited into a company that was still very much state-run: Repsol in Madrid.
A BASE IN AÍNSA
Many geologists will have heard about or even visited the village of Aínsa in the Pyrenean foreland in northern Spain. The area hosts a broad series of world-class outcrops of deep-water Eocene sediments, and is also the place where Henry and Rosario spend a significant part of the year. “The fact that we bought some land here and had the house built stems from our experience in Leiden, the Netherlands,” Henry says. “During my time at Shell in the Netherlands, we enjoyed Leiden so much and always regretted moving away. When my time in Spain came to an end, we decided to not let that happen again, and have something to come back to. It became Aínsa because of obvious reasons! And when I run a field trip now, and it rains, I can easily go and run part of the course in the house because the building stones contain a wide variety of sedimentary structures from the field.”
Embracing a new culture
“I was hired in Repsol to become the Peru exploration manager, with the view that I would eventually be sent to Lima,” Henry explains. But things went in another direction. He was sent to work in the Spain business unit on his first day, but was transferred to another business unit by the afternoon.
“The next morning, I was having coffee,” he says, “when I saw a two-page notice posted on the wall, and by scanning it I kept seeing the words “Geologo Americano”. It was a letter from the labour union, saying that as an American geologist, I had no accreditation to work on the geology of Spain.”
“It was a pivotal moment in my career. At that moment I realized that this is not so much about technical expertise, but rather making sure that I would fit in with these people and make sure that I was accepted. I had to find a way to break into that.”
“So every day, during lunch, I conversed with Lorenzo Villalobos, who is still a good friend of mine, to talk football, to talk food, and to talk Spanish language and culture. And not the Mexican Spanish I had been mostly exposed to until then.”
And it worked. “I managed to find myself a niche in the company,” continues Henry, “and that happened already after a few months in the job, thanks to my visionary boss at the time, who recognized that our risk analysis was not up to scratch.”
Henry expressed an interest to set up a new way of peer reviewing, performing the internal benchmarking and ranking of prospects. Referring to his Shell years during which he had grown into that type of work, he was lucky enough to be given the responsibility at Repsol. He subsequently spent a few great years implementing a more rigorous system of technical review.
ARE YOU AWARE OF THIS THING CALLED TAMAR?
“One day, our Israel country manager for Noble – Colin Sinclair – walks into my office and asks: “Are you aware of this thing offshore Israel called Tamar?”, says Henry. Colin handed over a farm-out flyer, which showed an amazing flat spot over the Tamar prospect. Henry and Colin made his boss – Sr VP Exploration Susan Cunnigham – aware of it, and she said she had heard about it also.
Henry subsequently looked at the exit report of the previous operator of the block – BG – to find out what their argument was not to drill Tamar despite this prominent flat spot. One of the main geological reasons BG put forward was around the reservoir presence. How to get sand deposited at that location so far off the Israeli coast?
“It is unlikely coastal Israel was a significant sand source indeed,” says Henry, “as it is essentially a series of carbonate hills along an active margin. But, there is another source of sand close by, which is significant; the paleo Nile and possibly other river drainages from the African craton and the Sinai.”
Why did it take the guys from Noble to be the first to propose the paleo Nile as the source of sand for the Tamar prospect? “It was surely a new pair of eyes that was needed”, says Henry. “Maybe people in Israel were too much focused on a reconstruction that had Tamar being fed by an Israeli source of sand rather than a much larger African or Sinai Egyptian one?”
“I started comparing the distance between the East Med Miocene shelf margins to where Tamar was, and found that it is less than the distance between the Wilcox Gulf of Mexico discoveries and the Wilcox shelf margin. In addition, like the Laramide uplifts in the USA, there were multiple uplifted areas onshore Egypt. In other words, why would it not work for the Nile when it works for the Mississippi?” And the poro-perm could be much better since it was not buried nearly as deep.
More due diligence was done on the exploration concept, including bringing in some outside specialists for independent analyses, and the team concluded that they had a good case to drill Tamar.
With Susan’s backing, Chuck Davidson, Noble’s CEO, subsequently bought into the idea of drilling Tamar, and so it happened.
“If there is one mistake we made, after finding gas that formed the starting shot for Israel to become entirely energy independent,” says Henry, “it is our estimated sand thickness. We were way too pessimistic and found significantly more than our P10 number.”
The mini-major
Following seven years at Repsol, something started itching. “It was a conversation at a conference with an old Shell friend that got the ball rolling,” Henry says. “This friend had recently joined Noble Energy, and he said that they had heard about the portfolio risking methodology that I had set up in Repsol.”
“Shortly after, I found myself in an interview with Susan Cunningham, head of exploration, and Chuck Davidson, the new CEO. Their view of where the company should head to really resonated with me.”
By moving to Houston, Henry brought a clear idea with him on how to help improve Noble’s exploration performance. “When I started, 19 % of our drilled DHI-supported prospects were successful. After a few years, we were at the industry average of 50 %, and shortly thereafter we were at 80 %.”
That did not come easy, though. “I had to be the nice guy and win people over, but I also had to introduce a strict quality control process with which everybody in the company had to work.”
“We started to measure everything, from our ability to predict success rates to the costs of getting a new discovery to production. Most importantly, our greater level of quality assurance resulted in better selection of which prospects to drill, which in turn resulted in significant improvement at finding the resources we predicted, with significantly less drilling costs.”
But that wasn’t all. “We were on a treadmill of drilling small discoveries mainly in the onshore Gulf coast that kept the cashflow going but the volumes were small and our inventory was running out at the same time. We had to break out of that cycle.”
That’s easier said than done though, as there is always the pressure from shareholders to replace production, and have something positive to report at quarterly briefings. “The high turnaround drilling we did onshore US satisfied that need,” says Henry. “But Chuck – an engineer who did not have a formal background in exploration, yet had a very keen understanding of it – understood that it was the riskier and more frontier work that was required to make a change. By doing so, Susan and I had his full backing, which is essential when trying to change a company culture.”
“Even though we failed in certain areas, we broke open some new basins; most notably the Levant Basin in Israel and the Douala Basin in Equatorial Guinea”, says Henry.
The East Med and West Africa discoveries were highlights in Henry’s career. Not only because they demonstrated the value of frontier exploration, they also formed the culmination of a drive to objectively prioritize and scrutinize a company’s prospect inventory.
Henry spent 16 years at Noble, after all. But with Chuck Davidson and Susan Cunningham eventually retiring and new executives coming in, the exploration mindset changed. Combined with the aftermath of the oil price crash in 2014, it made Henry weigh up his possibilities, with yet another opportunity materializing soon. And it was an opportunity that had been in the making for many years.
THE HIGHEST-SKILLED OIL FINDERS
The DHI consortium, which was formed by Mike Forrest in 2001 after a recommendation from Peter Rose from Rose and Associates, is all about companies discussing their prospects with each other and having an open conversation about the many factors influencing the chance of success.
“At its height,” says Henry, “we had 37 companies in our group, which translated to us reviewing and debating many of the most high-profile recent global DHI-supported prospects that are being drilled – from Indonesia, Namibia and Guyana to over 40 other basins.”
During the six annual consortium meetings, the member companies show their prospects and all participants subsequently discuss the various aspects of them, not knowing the drilling result until the end of the presentation and risking debate. “Imagine being part of a group consisting of the highest-skilled oil and gas finders using DHI’s, that’s what this is all about”, says Henry.
The DHI consortium
“It’s about time for me to really step down,” said Mike Forrest to Henry in 2018. By then, Mike had been leading the Direct Hydrocarbon Indicator consortium for about 16 years. “I think it makes sense for someone to take over who has been with us for a while,” he said, knowing that Henry had been participating at the meetings from day one.
“I had known Mike for a long time as we shared many years in Shell, where he was my General Manager in my early days. He also continued calling me up at times when he needed feedback on geological matters,” adds Henry.
Everything fell into place. And despite being a geologist by training, Henry felt comfortable enough to take on this challenge of leading what was primarily a geophysical consortium.
“Even with the energy transition progressing, I feel that the DHI consortium still has its place for quite a number of years,” says Henry, “simply because deep-water oil and gas rank amongst the lowest-carbon barrels across the hydrocarbon production spectrum.”
“And apart from that, there is the everlasting desire to use DHI’s in environments where they have not been used traditionally. For instance, we get asked about DHI’s in carbonates all the time. Granted, there are many barriers as to why you don’t see DHI’s in carbonates, but in some cases you do, with the Búzios field in Brazil being a good example. Don’t ask me how, as it’s got everything working against it, but it is there.”
Progress in technology also contributes towards better imaging DHI’s. “(Elastic) Full waveform inversion and continuing advances in computing power are doing so much these days,” Henry adds. “At the recent IMAGE Conference, Bill Langin from Shell showed a line across the Mars field in which the syncline we talked about earlier looked like a shallow drilling hazard!”
“Then there is the Class IV AVO’s – as in some of the Guyana finds – which are an extremely difficult class to deal with, and the phenomenon of dim spots in Class I AVO. There is just a lot of research and learning still to be done on all this.”
“Reflecting on all this,” Henry concludes, “you can easily say that I’m living the dream right now. No more responsibility for people’s careers, no longer the single point of accountability for correctly de-risking the next prospect, no budget responsibility, but rather meeting with like-minded people twice a year at a nice place to discuss what I have loved doing over the past few decades. I can’t think of a better place to be in right now.”
“But let’s not forget,” he continues, “the experience we as consortium leaders bring to the table and what we provide to our members in the form of consultancy, is also deeply rooted in failure, the things that did not work out.”
Learning by making mistakes
“One time out of four, I get it completely wrong,” says Henry when we get to talk about how to learn. “My brain sometimes sees something that it wants to see, not what it should see.”
“An example of this is a prospect I worked up when I was still in my early days, called Rigel in the Gulf of Mexico. It had good downdip fit to structure, it had good seismic amplitudes, and I had a good story of onlapping sands. But you know what we found? Half a TCF in a coccolith marl with such a near-zero permeability that the RFT tool was unable to obtain reservoir pressure at all!”
“Everybody in Shell was convinced I had it nailed pre-drill. The prospect was one of the top ones of the lease sale and it was immediately put on the drilling schedule. I was going to be a superhero, but instead, I was super humiliated! It turned out that what I had picked as an amplitude within a lowstand sand succession was one horizon off, and in fact a maximum flooding surface. I’ve used it as a case study ever since.”
“And the thing is, I got the downdip potential right. I had mapped it as a secondary target because I could interpret the charge system and underlying DHI-supported sands that must have fed the main reservoir target before compaction of the coccoliths destroyed all the permeability. But there were drilling cost factors that led Shell to drill only the updip main target. Murphy later drilled the downdip portion and found the Medusa field…”
What makes a good explorer
We are getting close to the end of the conversation, and I ask what makes a good explorer. “If there is one thing that I would recommend,” says Henry, “it is to get away from the desk and spend time doing things that free up your mind. Only under these circumstances, at least that is personal experience, associative thinking has a chance to kick in.”
“It is establishing links between seemingly unrelated things and my ability to recognize patterns – see the Wilcox analogy being applied to the East Med to de-risk Tamar – that have certainly made me to the person I am today – always with my eyes wide open!”
