Exploration discoveries are at their lowest ebb for 70 years but one continent seems to be bucking the trend. Since 2015, nine of the biggest global discoveries have been in Africa.
It will not be news to any reader that substantial oil or gas discoveries have been a rarity in the past year. In fact, according to Wood Mackenzie, new finds are at their lowest ebb for 70 years and explorers in 2015 discovered only about a tenth as much oil as they have found annually on average since 1960. Rystad Energy are reported as saying that we are replacing just 6% of resources we produce, with 2015 being the fifth year in a row in which the amount of new reserves discovered was smaller than in the previous year – and 2016 looks unlikely to reverse that trend. Since Wood Mackenzie also report that global spending on exploration has been drastically reduced, from around $100 billion in 2014 to about $40 billion this year, this result is hardly surprising.
One continent, however, is looking a bit more positive: Africa.
Since the beginning of 2015, nine of the biggest global discoveries have been in Africa: three in Senegal and Mauritania, two in Egypt, three in the waters off Angola and Congo and one on the eastern side of the continent in Tanzania. All of these are gas or condensate and all are offshore, the majority in deepwater. How easy it will be to monetise them in the present climate is uncertain, although Eni is making good progress with the development of the largest discovery of the last two years, the 30 Tcf Zohr field, anticipating first gas by the end of 2017. There is also a vibrant African LNG scene and significant potential in shale and other unconventional hydrocarbons. Africa desperately needs these resources: according to the OECD, in 2015 two-thirds of the population of sub-Saharan Africa still lived without electricity.
One company leading the way in West Africa is Kosmos Energy, and in Volume 13 Number 5 of GEO ExPro magazine we have an interview with Vice President of Exploration and Chief Scientist, Paul Dailly (Searching for Overlooked and Underexplored Frontiers). He believes one of the secrets of their success is being open-minded and refusing to ‘go with the flow’ – not ‘betting with the pack’, as he puts it. Looking at the company’s recent successes, maybe there is a lesson for us all in that.
For Africa and Kosmos Energy the only way is up! Offshore Senegal. (Source: Kosmos Energy)
