Exploration in Abu Dhabi

Exploration in Abu Dhabi started in 1950 with the drilling of the Ras Sadr well, which was a failure. With the discovery of the Bab field in 1954, the province has seen one of the most successful and efficient exploration programmes in the world.

Approximately 275 bnboe of in place hydrocarbons have been discovered to date, from 190 exploration wells. About 180 bnboe in-place is in 5 super giant fields (Bab, Bu Hasa, Asab, Zakum and Umm Shaif). The success rate has been about 1:2 throughout the period 1950-2000.

An examination of the cumulative discovered volumes curve (“creaming curve”), shows that history of exploration has been in three distinct phases; namely

• ۱۹۵۰-۱۹۷۰, super giant discoveries
• ۱۹۷۰-۱۹۹۰, giant discoveries
• ۱۹۹۰-۲۰۰۰, small pools era

There were two major peaks of Exploration drilling activity, in 1970 and 1983.

The clear message from the above mentioned facts is that the province is mature, if one ignores the possibility of opening up some new fairways or play ideas. The overwhelming majority of the discoveries made to date in Abu Dhabi are in simple 4-way dip structural closures. Exploration to date has focused on locating more of these features and quite naturally the number of possibilities is being rapidly exhausted.

By any standards exploration in Abu Dhabi has been a world class success, with about 275 bnboe discovered from ~190 exploration wells, at a technical success rate of ~1:2. After the initial phases of super giant and giant discoveries, the annual rate of reserve addition from exploration has declined to about ~500 mmboe in the last decade. As is natural for all basins, the size of discoveries declines over time. During the last decade 1240 mmboe were discovered in Abu Dhabi in 10 pools, of which 350 mmboe are in the ADCO concession.

The size of the recent discoveries is not of a material scale to ADCO. ADCO has remaining discovered reserves of ~100 bnboe in place and the addition of such small volumes from exploration does not make commercial sense at this stage of the province’s production history.

ADCO Business Background & Resource Summary

ADCO’s total discovered resource base is 117 bnboe in place, of which about 10 bnboe have been produced from its five developed fields (Asab, Bab, Bu Hasa, Shah and Sahil). The remaining un-produced resource (developed and undeveloped) is about 106 bnboe. At current production rates of 1.2 mmbbls/day the remaining discovered resource could technically support the organisation for probably more than 5 decades.

At the planned increased production rate of 1.4 mmbbls/day, the remaining lifetime of the resource is still over three decades. Clearly any future exploration activity would need to take this fact into account. At first sight these observations would suggest that future exploration would need to be targeted at pools that could make a material impact on the reserves based – drilling prospects with limited pool size potential does not make obvious economic sense.

The students accommodated are sometimes the sons or daughters of ADCO staff and still, the agreed guidelines are applied.

Exploration Strategy

ADCO has aspirations to replace annual produced reserves from Exploration. ADCO’s current annual production is ~400 mmbbls with a plan to increase this to ~500 mmbbls. Hence the target for future exploration has been set to be “to discover 500 mmboe of hydrocarbons every year on a rolling average basis”.

The goal of 500 mmboe/year sets a clear direction for future exploration. Hence, in future exploration needs to focus on testing large volume opportunities. Success in the new play types can meet ADCO’s aspirations for at least the next 10 years.

Given a goal of discovering at least 500 mmboe/year, ADCO Exploration has recommends the following

• In the near term, ADCO should focus on material plays, i.e. those of a scale to impact ADCO’s production needs in the next 10-15 years.
• Postpone exploration for small volume structural plays (4-way dip Thamama targets) as these are not material in the context of ADCO’s exploration goal – these targets are easy to find with 3D seismic and can be drilled later in basin life when needed to support specific declining fields.

To achieve this, the 10-year plan to address key technical issues and uncertainties has been designed and broadly encompasses:

• Extensive acquisition of good quality 3D seismic data and reprocessing of existing ones over the prospective areas;
• Thorough evaluation of prospectivity and application of state of the art technology prior to drilling; and
• Drilling of material prospects (>1.5 bn boe in place potential).