APPLICATION OF STATISTICS IN OIL AND GAS EXPLORATION
Statistics is very important in every field and sector since it has to do with data collation, hypothesis testing, analysis, inferences etc. The result of data collated and analyzed over a period of time can be used to make predictions and decision making policies. As a statistician, I would like to point out some of the application of statistical methods in Oil and Gas exploration.
Statistical methods help earth scientists to make geological hypothesis and find hidden patterns, variance, and original compositions of sample data. Through statistical analysis, one can develop a meaningful information summary in order to understand historical data, develop predictive models, and have the ability to quantify the results. Statistical techniques enable patterns and trends to be extracted from the data, and to establish relations between the different data sets. In brief, statistical techniques compress and organize large amounts of data into a small set of information. They aid in the identification of any valid relationships and patterns hidden in exploration databases. This can be useful in directing exploration and development efforts in areas with the highest possible potential.
Statistical modelling can be used to: locate areas favourable for exploration; to determine the “when” and “where” for the treatment, in order to optimize the exploitation programs of the reservoirs; implement quality programs and the identification of potential bypasses.
Statistical methods in oil and gas exploration serve as aids to exploration decision making at three levels: prospect, play and basin.
In addition, statistical analyses of the petroleum potential of large geographic regions guides state and federal regulatory, tax and policy analysis. While there is overlap, statistics as used in exploration decision making has features distinct from statistical analysis in support of aggregate appraisal of the petroleum potential of petroleum basins and larger geographic units.
Oil and gas company managers are responsible for finding and producing oil and gas. They wish to harness statistical thinking to a plow that turns up answers to questions like these: Where in a petroleum basin are geologic anomalies that might contain oil and gas located? How many such anomalies are present and what is their size distribution? What is the likelihood that a particular anomaly contains producible oil and gas? If an anomaly does contain producible hydrocarbons, how much can be profitably produced?